Manchester has potential to become UKs Silicon Valley
Manchester has potential to become UK's Silicon Valley
by Jonathan Kestenbaum
Can the UK produce the next Google or Yahoo and replicate the economic boom found in places such as Silicon Valley? This is the question slowly finding its way to the top of the political agenda. Recent critical comments by the shadow chancellor, George Osborne, drew some firm responses from university and business leaders, many of who felt the UK's achievements in this area had gone unnoticed. In Manchester and its region, in particular, the knowledge economy does appear to have grown substantially over the past decade. With hi-tech competition from the US and the emerging powerhouses of China and India, the UK's future status as a global economic player will increasingly depend on our ability to exploit knowledge and ideas.
Silicon Valley itself evolved out of an organic process which simply cannot be fully explained, but my view is that there has to be a number of ingredients present for this type of economy to grow. These include well-established links between higher education and business so that ideas can be turned into profits; a sufficient pool of start-up funding so that young companies can get off the ground; and the existence of a large number of creative young individuals to come up with new ideas. Most importantly, it all needs to be concentrated in one vibrant, creative space.
What is particularly vital to creating a knowledge economy is the ability of an area to attract high quality students and graduates from around the world and then keep them. From San Francisco to Tokyo, it is clear that a creative and vibrant area attracts the best minds and leads to a successful knowledge economy. Cities such as Cambridge are developing hi-tech hubs of innovation based on university spin-out companies, but can Manchester's livelier entertainment scene and more affordable housing give it the edge in the UK because of its capacity to retain of a pool of young, dynamic talent?
At the National Endowment for Science, Technology and the Arts (NESTA), we use our lottery-funded £300m endowment to invest in all stages of the innovation process, backing ideas and funding ventures that can develop into successful companies. Not every investment we make results in a booming business. But, with risk capital for young companies lacking across the UK, this type of financing can be vital to kick-starting a local economy. We also fund projects throughout the country, including the high-tech Bolton TIC centre, which is nurturing innovation and creativity among young people.
Throughout the UK, however, turning concepts into companies is not yet the norm and, despite much recent progress, the US and Sweden still remain ahead of the game when it comes to aligning creativity with entrepreneurship. Despite the pessimism that sometimes surrounds the debate, the UK has the potential to become a world leader in innovation. Manchester has the potential to take a lead in this mission. The question is, can it go the one step further, harness the "innovation x-factor", and become the UK's first equivalent to Silicon Valley? Having visited the region last month and been hugely impressed by the ambition of vision I encountered, the indications are that the answer is yes.
This article was first published in the North West Enquirer, 9 August 2006
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