Tech boom fuels record number of foreign firms coming to capital

 
Tidy outfit: Aaron and Adora Cheung, from California, run house cleaning app Homejoy, which set up in London this year
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Kiran Randhawa19 May 2015

A record number of foreign firms, fuelled by a surge in tech start-ups, are expanding or setting up headquarters in London, according to figures released today.

A total of 270 companies — creating nearly 5,000 jobs — have set up or grown significantly in the past year, says London & Partners, the Mayor’s business and promotional company.

Giants such as Pfizer, Greenland Group and Tata Elxsi have all expanded or created new HQs.

A decade ago just 26 tech companies set up in London but in the past financial year there were a record 108.

There has been a huge rise in the number of US companies setting up in London. And companies from India, China, Japan, Australia, Spain and France are also creating jobs in tech, financial and business services, as well as in the life sciences industry.

Gordon Innes, chief executive of London & Partners, said: “Over the last decade foreign investment in London has gone through the roof and the tech sector is now leading the way.

“Companies from all over the globe want to establish a base here because we have the best access to finance and markets, an incredibly talented workforce and overall first-class conditions in which to do business. On top of this, London is one of the most desirable cities in the world to live, with a vibrant cultural scene, exciting history and more green space than any other city in the world.”

Tech apps that have set up in the capital in the past year include ParkJockey, to find parking spaces, Strava, a running and cycling GPS tracker, and house cleaners Homejoy, started by brother and sister Aaron and Adora Cheung from California.

Kamal Rajput, ParkJockey’s UK general manager, said London was “an enormous market for us and we have been delighted with the welcoming business environment that has enabled us to expand here and succeed”.

The life sciences sector has attracted Takeda Development Centre from Japan and Cipla from India.

Commentary: ‘Intel’ london powering Britain

If there is an Intel chip powering the new hardware of UK performance, it is London.

Its role as the heart of the nation’s start-up economy has been well documented. In the next half decade London will be defined by its position as the gateway to the world: its talent, its capital and its ideas.

And it’s happening now. New figures from London & Partners, the Mayor’s promotional body, show that a record number of overseas companies set up here over the past year.

In particular, venture capital investment in London tech start-ups has boomed. Huge funding rounds are being held by fintech pioneers such as Funding Circle and TransferWise, to support global expansion plans.

Speak to VCs and many will tell you that London represents outstanding value and future potential for growth. A major challenge is to convert this economic vibrancy into a culture that can be shared across the UK. But beware those who claim London’s success comes at the nation’s expense.

It is the arrowhead of an emerging performance culture. And in an age when connectivity has never mattered more we must join London with the other great cities to supercharge the nation’s growth.

These are exciting days for the capital. World-class universities, Imperial College and University College London, setting up new campuses in both west and east; a rejuvenated Kings Cross Knowledge Quarter bringing together the best minds in science, medicine and tech; and next month, 40,000 global tech leaders gathering for London Tech Week.

Momentum is building but make no mistake, this isn’t just London’s story; it is the nation’s. A tale of Britain’s growth cities: the best of times are yet to come.

Michael Hayman MBE is co-founder of campaigns company Seven Hills and co-author of Mission: How The Best In Business Break Through.

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