London’s Silicon Roundabout has retained its title as the UK’s start-up capital, with more than 15,000 new businesses establishing themselves in the area over the last year, according to figures out today.
Accountancy group UHY Hacker Young found that the EC1V postcode around Old Street and on the fringe of the City of London borough saw 15,620 new businesses open their doors in the year leading up to March 31st. This was down 100 on the previous year, but still easily outstripping any other area in the UK.
The cluster of start-ups in the area that has become known as Tech City has been boosted by government efforts to promote it as a centre for new technology businesses, the accountancy group claimed. But Prime Minister David Cameron is still yet to spend the £50 million he promised to regenerate the area at the end of 2012.
Colin Jones, partner at UHY Hacker Young, said: “Silicon Roundabout has maintained its position as the epicentre of the UK’s technology industry. With so many start-ups and established businesses in the area, it is no longer hype to compare it to Silicon Valley, or TechHub Berlin.
“Rising rents in the Silicon Roundabout area mean that many start-ups are now choosing areas south of the River Thames, or East London as their first base."
The next-highest ranked location was SE1, home to the Shard, Bankside and Bermondsey, where 5,850 firms were established, up 13 percent on the previous year.
"The area has experienced rapid regeneration in recent years, most notably the development of the Shard, which is attracting the professional and financial services and businesses from the creative industries into the area," said Jones.
“Businesses are benefiting from the close proximity to the City and the West End whilst taking advantage of the lower office rents available in SE1.”
Canary Wharf, commonly thought of as the UK headquarters for many of the world’s biggest financial firms, witnessed 3,180 start-ups set up during 2013-14.
The E1 postcode in London, which covers the area from Spitalfields to Mile End, also saw an increase in new business generation.
Meanwhile, SW1Y, which covers Mayfair, saw the number of new businesses created last year, up from 1,830 to 2,020, despite having some of the world’s highest rates for office space.
“Mayfair is home to a large amount of activity in the financial services sector, especially hedge funds and private equity firms,” said Jones. “The prestige of opening offices in the area is vital to their business so they are not put off by the high rents.”
Leeds and Hove were the only places in the UK outside London to make the top 20.
UHY Hacker Young said that most of the new start-ups will be "one man band IT programmers, media or marketing consultants or contractors in associated businesses."
Indeed, there has been a reluctance from large tech companies to move to Silicon Roundabout, with LinkedIn, King.com and Yahoo all favouring West End locations that already have well-established advertising and public affairs networks.