There is a saying in the Australian tech industry that you have probably heard before “3 years ahead”. What this saying refers to is that when best practice global trends occur, Australia is 3 years behind other markets. This saying has been repeated time and time again regarding our maturity around funding, growth, talent and how we build our ecosystem. In some cases this is probably fair, but having just spent the last ten days in London I will be coming back with a renewed sense of belief in our ecosystem.
For those who aren’t aware last week was London Tech Week, a collaboration between the City of London and the Tech Community. The event is a (loose) collection of hundreds of events around the city designed to attract people from all over the world and put London on the map as a key technology hub. My time in London has been spent meeting expats, entrepreneurs, investors and attending a ton of events.
Here are my key takeaways on Growth, Talent, the Community and Investment.
Europe is right on London’s doorstep and you can feel that in the conversations. Most people I spoke to were thinking global (or at least not just London) very early on in their journey. The challenge however is not one of accessibility to other markets but one of knowledge and experience, how do you actually go global? Saalim Chowdhury the local Partner for 500 startups put it nicely The issue in London is we don’t know what great looks like. What Saalim was expressing is frustration with the mindset that people are going into their ventures with and as a result it is limiting their potential.
Talent was high on the agenda. Questions like: How do you scale teams? How do you build culture? How do you retain staff? Surprisingly (but also not) this was one of the most discussed topics at StartupGrind London. Successful Founders such as John Collison (Stripe), Cal Henderson (Slack), Miguel McKelvey (WeWork), David Buttress (JustEat) all spoke passionately about the need to get your people right. One of the messages that stuck with me was from David Buttress from JustEat – when asked how had he managed to keep the culture intact he spoke about how post IPO to help keep their culture intact he refused to look at the stock price or forbid it to be displayed anywhere around the office (JustEat floated for 1.5 billion pounds in 2014). The message was keep the focus on the important and fun things not something that others (institutional investors) care about.
It was a little strange but the majority of events I attended were run or facilitate by non-Londoners (mostly Americans in fact). Another strange thing I noticed was the level of knowledge in the community seemed to be lacking with the first time entrepreneurs I spoke with, for example I was talking to one founder about term sheets and I suggested he look at YC for an example of founder friendly term sheets and was a bit shocked that he had no idea what I was talking about.
Having said all this you can feel London Tech Week is a major (global) event, the quality of speakers and businesses on display overall was exceptionally high, I have absolutely no doubt it (and other events) will continue to get even better over the coming years and solve some of the issues I have mentioned above.
It feels as though investment has been driven historically by US VC’s (some of the majors seem to have a base in London – Accel, Index Ventures, 500 startups, Google Ventures with others flying in and out when needed). Locally investment seems to be through family offices or local European VC’s such as Atomico which was started by one of the Skype founders. Atomico in particular seems to have a crystal clear investment mandate as well as a value proposition back to founders (founders helping founders as well as a support network of specialists to help you scale) – it felt very similar to the a16z model.
Whilst businesses spoke about the need for diversity within their staff none of the VC’s spoke about the need for diversity within their own ranks (something I know Blackbird focuses on). All except Saalim Chowdhury the local Partner for 500 startups. Saalim spoke about a certain culture that exists within VC where you have to be a certain “type” of person. In London this means you either came from “old money” or attended a “public school”. It’s hard to know how much of this is an actually problem but the audience reaction to Saalim’s comments suggests it could effect deal flow.
So you might be thinking – some of the above sounds really familiar?
Well that’s because it is, I was surprised by the similarity of ecosystem maturity and thinking. I had assumed (rightly or wrongly) that London would be 3 years ahead. The good news is whilst there are advantages London has we aren’t behind either, in many ways I see the two ecosystems as being on par with advantages and disadvantages to both. So lets drop the notion that we are behind and instead believe that we can compete globally but along the way teach each other how to be great!