For many decades, London has been considered the start-up capital of Europe. The city where fledgling entrepreneur flock to thrive. London still lays claim to the title today and there are several reasons why that’s the case.
Primarily, London still enjoys a robust investment ecosystem, where venture capital firms and angel investors roam to readily invest and turbocharge great business ideas. It’s still open to one of the most diverse talent pools in the continent too, along with unsurpassed connectivity both from a physical and digital perspective.
Strong access to capital
There’s no doubt that London’s investment hub is one of the primary attractions for start-ups flocking to London. The city is brimming with venture capitalists and even crowdfunding platforms. In 2022, Britain’s tech sector alone secured £24bn in venture capital funding, with much of that flowing into the capital.
Even the UK government is well-placed to support start-ups in London. There are several initiatives such as Innovate UK, delivering grants and loans to progressive new firms, as well as the Seed Enterprise Investment Scheme (SEIS), which offers much-needed tax relief to early-stage companies, helping to invite capital flow into these fledgling businesses.
Openness to global entrepreneurs
The open economy of the English capital makes London an attractive destination for overseas entrepreneurs too. Foreign nationals have the opportunity to start new businesses here in the UK and especially in big cities like London, as a gateway to the European markets.
Many overseas entrepreneurs tend to thrive in London and stick around too. After launching a successful start-up, they have the opportunity to take the self-sponsored route to stay in the UK, which is known as “UK self sponsorship visa“. Please note this is not an official visa category. However, if the business obtains a Sponsor Licence, it can sponsor them for a Skilled Worker Visa, effectively making them “self-sponsored”. In doing so, foreign entrepreneurs have the opportunity to bring their spouse or partner and children to the country to put down roots in the country too.
Flexible infrastructure
London has rapidly adapted to meet the needs of start-ups by being increasingly flexible over workspace and support infrastructure. Co-working spaces have become an invaluable tool for new businesses to land and expand at very low risk and cost. These spaces also tend to offer scalability, giving start-ups the freedom to increase their premises or on-site amenities.
Infrastructurally, London remains hugely inviting for start-ups. It’s a stone’s throw from international airport hubs like Heathrow, Gatwick and London City. The infrastructure is there from a digital perspective too. As part of London City Hall’s plans for the city’s economy, “Connected London” is an initiative aimed at delivering world-class digital connectivity to all homes and businesses in the capital.
Supportive policies and innovation on tap
The UK government has also worked hard to underpin London’s position as the European start-up capital. Initiatives such as Tech Nation, which give start-ups the mentorship and resource to scale up their businesses, are worth their weight in gold. Sticking with the tech theme, London is also a hub for digital innovation clusters. East London’s Silicon Roundabout has become a world-renowned tech district, birthing multiple unicorn companies through the years.
In short, with bolstered access to investment, infrastructure and a deep, diverse talent pool, it’s clear London is still one of the world’s most supportive environments for launching successful businesses from the ground up.
For further reading around the subject check out the following:
- Discover how AI and data are being leveraged to support London start-ups
- Learn more about Hackney’s East London Tech City, also known as Silicon Roundabout
