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Leadership / Digital Transformation

Rackspace brings Startup Program to UK tech scene

Hosting firm Rackspace has announced it will be bringing its Startup Program in the UK, offering fledgling businesses access to its cloud computing platform.

The company says its US Startup Program has helped 850 companies since its launch there two years ago and hopes to have the same impact here.

Rackspace will be working with organisations such as universities, VCs and co-working spaces to get access to start-ups building up their business in the UK. Companies joining the program will receive around £12,000 of cloud hosting and mentorship.

The news was announced at an event held at the Google Campus near Old Street, in the heart of London’s start-up community. The area has been nicknamed Silicon Roundabout, a reference to the local roundabout on Old Street as well as a nod to Silicon Valley in San Francisco, home to many of America’s start-ups and VC funds.

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Rackspace executives at the event pointed out that in 2009 alone over 250,000 VAT registered businesses started in the UK. The benefits cloud computing can bring, such as reduced infrastructure costs and increased flexibility, mean it is a vital investment for start-ups to make if they want to grow.

However a panel debate at the event also threw up a few other factors crucial to success, primarily belief in the product you are creating and lots of hard work.

Entrepreneur Julie Meyer, founder and CEO of investment firm Ariadne Capital, recounted a tale of receiving a text message from the founder of a company she had invested in. "The message said ‘119 meetings and 76 nights away from my wife but at last we have a customer’. You have to have that drive; lots of competitors will give up after five to ten meetings, lots aren’t stupid enough to keep going," she said.

Of course other elements, such as serendipity, will help, as will being really clear about exactly what you do. Technologist Robert Scoble said simply: "If you cannot explain to me what you do in a minute I am not interested."

A lot of the discussion focused on the state of the UK investment market and the role the government is playing is helping start-ups get that investment and fulfil their potential. A recent survey (PDF), conducted by Telefonica Digital, revealed that London was the seventh most attractive city in the world for start-ups. However it also revealed a big "funding gap" here, with 81% less capital raised by start-ups before their products hit the market than those in Silicon Valley.

Benjamin Southworth, the new deputy CEO of the Tech City Investment Organisation (TCIO) told the event that the government was working on improving access to VCs and the IPO situation at the moment, which he described as "not as good as it should be."

"But to have a government understand that there is a revolution going on in east London and put 10 people whose day-in, day-out job is to help start-ups is amazing," he added. "That’s never happened in any other growth industry anywhere. The government spoke to Eric Schmidt and told him they wanted the Google Campus here. The fact we are attempting to do something here is a huge difference of mindset than letting you go free and ignore it."
This article is from the CBROnline archive: some formatting and images may not be present.