Manchester’s tech scene has long been a hub of innovation in the UK. With a rich history in technology and digital advancements, it continues to attract attention.
Recent developments suggest that the missing element in Manchester’s tech success story is slowly being added, promising new opportunities and growth for the sector.
Investment Landscape Transformation
David Smith, a prominent investor with 25 years’ experience, notes the transformation in Manchester’s investment landscape. Historically, regions like the North West struggled to compete with London and Edinburgh in attracting investors. However, this trend is beginning to shift.
Smith highlights that while there is substantial investable capital around Manchester and the North of England, it has grown organically. Despite significant changes and advances, funding has remained a constant challenge for the area.
London and the South East have traditionally benefited from a substantial influx of investment, with regions like East Anglia and Scotland also performing well. In contrast, other areas, including the North West, have been comparatively underfunded.
Initiatives and Momentum
The North West Fund for Digital & Creative, established by Smith, made over 40 investments in start-ups like Playdemic, Fatsoma, and Reality Mine. This fund was instrumental in providing early-stage capital to promising ventures.
Three years ago, Smith joined Dow Schofield Watts to inject more momentum into their tech sector initiatives. Conversations with early-stage companies revealed a significant challenge: securing funding outside of the Northern Powerhouse Investment Fund (NPIF).
Recognising this market failure, Smith and Dow Schofield Watts saw a profitable opportunity to intermediate in the funding process, benefiting both the companies and private investors.
Angel Networks and Support
Smith’s involvement in Tech Manchester as a mentor underscores his commitment to the region’s tech growth. Additionally, new angel networks are emerging to support Manchester’s tech entrepreneurs.
In 2017, Dow Schofield Watts launched an angel network, and Manchester Tech Trust is developing a similar initiative. These networks aim to bring more investment into the area, with the UK Business Angels Association also concentrating efforts in the regions.
Smith emphasizes that the initial experience of angel investing can be daunting. However, as investors gain familiarity and share experiences, the process becomes more comfortable and widespread.
Strategic Investments and Success Stories
Dow Schofield Watts has been making strategic investments, injecting up to £500,000 into start-ups. A notable success includes a £300,000 investment in eCommerce platform Shopblocks, which now has over 300 customers.
Smith’s team assisted Kevin Jones, founder of Shopblocks, by reorganizing the company’s shareholdings and developing a robust sales and marketing strategy.
Smith’s confidence in Jones is evident. He describes Jones as a bright, hardworking individual who deserved support despite earlier setbacks when the North West Fund ceased operations.
Challenges and Risks
Investing in early-stage companies is inherently risky, a fact acknowledged by Smith. He points out that merely injecting capital without guidance can lead to failures, even for promising companies.
Smith asserts, “It is in the nature of early-stage companies to fail – we just try to keep them on the straight and narrow and give them every chance of success.”
The goal is to provide not just financial support but also strategic advice and mentorship to maximize the chances of success for these start-ups.
Future Prospects
The investment landscape in Manchester is evolving, with increased momentum and support from various initiatives and networks.
Smith’s role in mentoring and his active involvement in investment activities are paving the way for a brighter future for Manchester’s tech scene.
Continued efforts to attract investment and support early-stage companies are essential for maintaining this positive trajectory.
Conclusion
Manchester’s tech scene is steadily transforming, driven by strategic investments and the emergence of supportive networks.
David Smith’s extensive experience and active involvement are pivotal in overcoming funding challenges and fostering growth.
As these initiatives continue to gain traction, Manchester is well-positioned to solidify its status as a leading tech hub in the UK.
In summary, the missing piece in Manchester’s tech jigsaw is being added through strategic investments and support networks.
The future looks promising as efforts to attract and retain investment continue to gain momentum, solidifying Manchester’s place in the tech landscape.