Technology entrepreneurs in London are suffering from a lack of 'smart' investors, according to a venture capitalist (VC) firm.
This is why European entrepreneurs are looking for investment in Silicon Valley, rather than the UK, Charles Irving, co-founder of VC firm Pond Ventures, told delegates at the InnoTech Summit in London last week.
"Silicon Valley investors are smarter. If you want to raise money you don't want to pitch to a stiff shirt in the City across the table who does not understand your business.
"You want to pitch to people who understand your business. Investors have to remain experienced," he said.
While Irving said the situation has improved since he first started investing in Europe in the past few years, he added: "We are a long, long way to having smarter investors in Europe."
Irving was also sceptical about the branding of London as a digital centre, with its focus on building a digital ecosystem in east London's Tech City.
"As investors, we could not care less if [the start-up] is in London, Berlin or Silicon Valley," said Irving.
"It is all very good to create the right atmosphere and place, but at the moment, the hot place is Berlin for digital investment, because it is cheap and London is expensive."
The key is to have, instead, "great people", he said: "We are looking for great people, exceptional people to give back. We have [invested in] companies in the UK, France, Turkey, Silicon Valley, Romania, Spain, so we are going where those great people are."
Furthermore, these people should base themselves where their customers are, said Irving, describing customers as the "real hub" of a successful business, rather than a particular city.
"We should herald success rather than create a brand for cities. It will just get stale after a while."
Meanwhile, despite Mayor of London Boris Johnson's pledge to make London as the 'digital centre' of the world, fellow InnoTech Summit panellist Oscar Jazdowski, senior relationship manager from Silicon Valley Bank, said that government input is not essential.
"What the government has done has helped, but the government cannot create an ecosystem. It has to start itself - and it has started [in London]," he said.