Gianpiero Lotito, founder and CEO of search platform FacilityLive, and a founding member of the European Tech Alliance, outlines a vision in which Europe can rival Silicon Valley and explains how UK firms can get on board.
Europe is a greenfield of opportunities for tech startups. Reports vary, but indicate that tech startups received somewhere between $13.6 and $17.1bn in venture funding last year, representing an impressive rate of growth.
Certainly, Europe will never be able to form a carbon-copy of Silicon Valley, but we can learn how to play to our strengths as a collection of ever-strengthening tech hubs.
Rather than a monolithic Silicon Valley model, where economies of scale are chief among the benefits, we in Europe can create many small valleys, with opportunities that seemed unthinkable only a few years ago.
Whilst the European Commission continues to work towards a Digital Single Market, tech entrepreneurs across the continent and the UK can take their own steps towards this vision, strengthening local and international connections to create an ‘unofficial’ Digital Single Market.
European in origin, global in mindset
Many tech companies founded in Europe are very keen to be global, but not so sure of what it means to be European. It’s important to remember both, if we are to counter American technological dominance on the software side and Chinese on the hardware side.
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The ‘Old Continent’ must start to build a structure of small technology clusters, focused around our ancient academic institutions – a ‘small valley’, if you like, in which economy of scale is replaced by the symbiosis of a small ecosystem, ideas shared more quickly and effectively across disciplines to create continuous innovation.
Recognise the strengths of your local ‘small valley’
According to the Times Higher Education ranking of computer science faculties, five of the world’s top 10 computer science institutions are European. Beyond that, six of the top 50 are British institutions – Oxford, Cambridge, Edinburgh, Imperial, UCL, Manchester.
In Europe, we need to play to our strengths and recognise our many centres of excellence, especially concentrated in cities where there are ancient universities producing highly skilled individuals.
Tech startups who can position themselves in small clusters around these institutions will become part of the fabric of the ‘small valley’, playing their part in the health of the ecosystem by helping to avoid the ‘brain drain’ of graduates away from their universities, and bringing commercial value to the innovations coming out of academic organisations
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Build your own digital single market
One of the pressing questions facing the European digital market at the moment centres around how we can unlock more of our potential by building closer links between our disparate hubs or ‘small valleys’.
There tends to be high levels of interconnectedness within Europe’s main hubs, demonstrated through significant numbers of tech meetups, for instance. But the links between different hubs are still perceived as weak by 40% of investors.
This is one question being address by the European Commission as they work to develop a Digital Single Market, which supports companies in aspects such as uniform regulation and easy talent flows.
But interconnectedness doesn’t entirely rely on macro projects such as these. Networks of startups, universities, accelerators, and investors already exist. Particularly as UK companies face the uncertainty surrounding their future in the European Single Market, these more informal networks, which are springing up to connect the continent’s innovation heartlands with its emerging hubs, are more valuable than ever.
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Have faith in Europe
I have always had a deep-rooted desire to build a European success story, which helped me to stay firmly committed even when some big companies came knocking on the door.
My aim has always been to list in London, rather than New York, even before the opportunity to be part of the London Stock Exchange’s ELITE programme arose. Even with this deep-seated and long-standing belief that Europe is good at tech and a good place to grow a technology company, it wasn’t easy always easy to hold out for the good days.
If you’re struggling to believe the UK and Europe have a future for your company, take inspiration from those that have gone ahead, and those that are fighting every day to make Europe a better place for tech startups and scaleups.
The fact that there are more professional developers in Europe than the US can be obscured by the shining attraction of the Silicon Valley model. But the future for European startups, including those in the UK, is bright with opportunity: we just need to recognise our own distinctive strengths.