Greater Manchester’s tech sector is growing in confidence, but access to funding, the right support and a scale-up “ceiling” remain key challenges as some of the city’s tech leaders came together to discuss what it really takes to build and grow businesses in the region.
The conversation took place at Prolific North’s first GRAFT Regional Tech Champions roundtable on 21 April, supported by MHA and Vista Insurance at Colony’s Silk Street offices in Manchester.
The event brought together founders, investors, advisers, and leaders across the ecosystem to examine the region’s tech momentum and debate some of the barriers still holding some businesses back.
READ MORE: Prolific North launches GRAFT Regional Tech Champions initiative
While there was optimism about the city’s ‘impressive’ growth trajectory over the past decade, with one start-up leader declaring “the wind is in the sails”, there were also warnings that the transition from start-up to scale-up needs some work, with leaders also sharing what they’d most like to see change in the region over the next 12 to 18 months.
Attendees:
- Karl Holbrook (chair), Editor, Prolific North
- Russell Cooper, Partner, MHA
- Michelle Mullany, Head of Deal Origination, MHA
- Ben McKay, Founder, Voxelo
- Talia Slater, Investment Associate, Palatine
- Claire Foreman, Director, Greater Manchester Institute of Technology
- Jayden Patel, Founder & CEO, Acquaint
- Troy Wood, AI Investor, FHunded and EHE Ventures
- Robert Stein, CEO, Full Send & Morvo
- Alastair Brown, Global AI and Technology Director, BrightHR
- Ben Davies, Marketing Director, PXN Group
- Amul Batra, Co-founder, Northcoders / Counter
- Martin SFP Bryant, Founder, PreSeed Now
- Alex Cropper, Head of Technology and Development, Kaboodle
- Hanna Latif-Walmsley, Founder, Laika Family
- Mark Armstrong, Head of Technology, Sompo
- Darci Edwards, Head of Tech & Life Science, Vista Insurance
Why Manchester? Confidence, community and a city that’s “thriving”
Karl Holbrook (Prolific North) opened the discussion by asking what is powering Greater Manchester’s tech momentum. For Alastair Brown (BrightHR), the last decade has seen a “really vibrant expansion” of tech talent and successful businesses, making it an “exciting time” for Manchester.
Beyond the rapidly changing skyline since moving to the city 10 years ago, Darci Edwards (Vista Insurance) said the sector is booming thanks to inward investment and emerging businesses across various sectors, from medtech and cybersecurity, plus university spinouts.
READ MORE: Where Greater Manchester’s tech growth is happening — and what’s driving it
Others agreed Manchester’s tech ecosystem is “thriving”, with Hanna Latif-Walmsley (Laika Family) highlighting the city’s “scrappy founder” mentality, while Talia Slater (Palatine) said Manchester firms are competing not just in the North, but internationally too.
The quality of founders, university spinouts and tech talent has “drastically” increased in volume over the past four years, while graduates now see the opportunity to build, grow and live in the North, explained Troy Wood (FHunded / EHE Ventures).
Claire Foreman (Greater Manchester Institute of Technology) suggested the city region’s mayor, Andy Burnham, has “really put the city on the map”, particularly around talent pathways. That leadership also helps reshape perceptions: “If you talk a place up, everybody starts to believe it.”
Sticking with talent, Alex Cropper (Kaboodle) said he was once told he would “never be able to scale a tech team” from Manchester, but said this is something his experience has since disproved after helping transform Kaboodle from start-up to scale-up, and that talent is now seen in budding and established businesses dotted right across the region.
Yet despite praise for Manchester’s “connected and collaborative” ecosystem, Jayden Patel (Acquaint) said there is a “gap” that still needs bridging, with London-based tech companies still continuing to receive the lion’s share of funding.
As PXN Group is now “the most active investor” in the North of England and Scotland, Ben Davies (PXN Group) said he is “constantly reenergised” by Manchester’s ecosystem, but acknowledged many founders remain “over mentored and underfunded”.
For Michelle Mullany (MHA), Manchester has become a “real hub of activity”, with private equity firms keen to secure a stake in growing regional businesses because they “don’t want to miss out”.
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And while “the wind is in the sails” of Manchester in a way it perhaps was not a decade ago, Ben McKay (Voxelo) pointed to improvements including more investment and better infrastructure while warning the city is still “nowhere near to where it needs to be”.
Scaling momentum meets reality
Greater Manchester has moved beyond its “challenger brand” identity, said Davies (PXN Group). Now the city region must prove it can not only compete, but be better than ecosystems in cities like Lisbon, Berlin and Barcelona, which he argued it already does in “lots of cases”.
He added “we should always celebrate our wins”, but the challenge is that there is still a “ceiling that scale-ups get to here” where they may have made it in the North West, but are not competitive globally yet.
Cropper (Kaboodle), reflecting on his time at former Manchester success story LateRooms, said scaling is often about finding the right opportunities, whether that’s investment or access to the right people.
And there is a growing community of the ‘right people’ now, thanks to the “flywheel” effect, added Davies (PXN Group), with more founders emerging from successful exits, more scale-ups creating new ventures and a younger generation of angel investors coming through. But it “takes time”.
As both start-ups and large enterprises are “overwhelmed” by the range of opportunities available, McKay (Voxelo) suggested there is space for someone in the region to step in and connect them through curated events or by acting as an intermediary.
But Latif-Walmsley (Laika Family) described a widening gap between being a start-up with a promising idea, gaining traction and then securing the capital needed to scale. She argued that some investors appear to move the goalposts after founders hit certain milestones.
While there is “pride” in bootstrapping until investment is needed, and she welcomes accelerators and support programmes, there comes a point when founders simply need financial backing to grow.
“You can go on as many accelerators as you like, but without funding, you’re never going to get anywhere.”
Funding woes, talent and diversity challenges
Frustrations around access to private capital and Innovate UK grants quickly became one of the biggest talking points.
Mullany (MHA) said capital is available, but investors are becoming more selective: “The due diligence that’s done is greater and greater. It’s a harder landscape.”
Several founders described the challenge of balancing fundraising, grant applications, accelerators and investor networks, all while also trying to run their businesses.
Founders need “faster, clearer ‘nos’” if there is no intention to invest, said Davies (PXN Group), so that time can be spent elsewhere.
Latif-Walmsley (Laika Family) agreed as with no income or revenue, time is a founder’s “biggest asset” that they can’t afford to lose. She explained there is still a “massive knowledge and practical gap” for early-stage founders too. Patel (Acquaint) added that applying for grants can feel more like learning how to pass an exam than learning the topic itself.
Founders are “flooded” with advisory support, while much of the real value of accelerators lies in the “thread of community” and introductions to investors or partners, explained McKay (Voxelo). He also questioned whether some support funding should instead be redirected into capital.
Wider UK macroeconomic pressures “inevitably flow into what we can do as a region”, said Wood (FHunded / EHE Ventures), adding it has “never been harder” to raise a multi-million pound fund.
Amul Batra (Northcoders), who helped steer the business to IPO in 2021, said Manchester appears to have more founders than ever before. While that is a “good thing”, he questioned whether it has increased competition for funding.
Martin SFP Bryant (PreSeed Now) argued founders should not rely too heavily on government support, as priorities will always shift, particularly in the midst of on-going global conflicts. Instead, he pointed to Greater Manchester’s self-driven growth and urged founders to build networks, think internationally and create their own opportunities.
When Kaboodle went through its acquisition last year, Cropper said leaning on his Manchester CTO network proved invaluable to help navigate the process. McKay (Voxelo) said this highlighted his earlier point around the importance of networks, though more structured support could act as a useful “bridging solution”.
Latif-Walmsley (Laika Family also raised the issue of representation when it comes to introductions, networks and investor circles. When founders scale, exit and reinvest in the North, it is often into people who “look and feel like them”.
She argued that women, particularly women of colour and those from working-class backgrounds, still face barriers to funding and access to influential networks. She said she has seen male founders secure investor interest at the idea stage, while her own business, with traction and a working prototype, has struggled to access the same opportunities.
To tackle this, Davies (PXN Group) said more VC firms are trying to make processes fairer and PXN no longer accepts warm introductions. All founders complete the same form, so “everyone is treated the same”.
But while progress is being made through more female investors, diverse angel networks and initiatives such as Lifted Ventures, he admitted the industry still has work to do: “People invest in people who look like them.”
There was also discussion around how parts of the industry can feel “designed to take advantage” of early-stage start-ups, from advisers charging thousands for SEIS support to angel networks even charging founders to pitch.
The chat then returned to talent, with a debate over how challenging the current environment is for both employers and tech talent. Over the past week, eBay recently confirmed to Prolific North that it is closing its Manchester operations, while several staff at Partful took to social media to say the scale-up has reportedly gone into liquidation.
For the next wave of young talent, there is still a “great nervousness about whether AI will take their jobs”, said Foreman (Greater Manchester Institute of Technology). She added that this is compounded by concerns that some companies are outsourcing roles abroad because it is “cheaper” than hiring locally.
There has never been more scrutiny over new hires, which is affecting entry-level roles, said Davies (PXN Group). But he pointed to scale-up success story examples such as Street Group, which has invested heavily in culture and talent and seen the payoff.
What should come next for Greater Manchester tech?
Wrapping up the discussion, leaders in the room were asked what they wanted to see change most over the next 12 to 18 months in Greater Manchester.
From celebrating regional success stories for longer, to clearer routes from start-up to scale-up, better coordination between support organisations and attracting more outside capital into the North, there was no shortage of ideas.
Edwards (Vista Insurance) highlighted the need for more support for businesses entering their scale-up phase, while Mark Armstrong (Sompo) said there must be a stronger focus on diversity.
Latif-Walmsley (Laika Family) agreed, calling for greater diversity across the region’s tech landscape, alongside better opportunities and more funding for early-stage start-ups.
She wasn’t alone in that view, as Patel (Acquaint) said more must be done to bridge the gap between early-stage and scale-up support: “We haven’t had many unicorns in Manchester – I think that speaks volumes.”
On skills, Foreman (Greater Manchester Institute of Technology) said teaching needs to become more flexible as skills are changing rapidly, while Batra (Northcoders / Counter) stressed the importance of continuing to back early-career talent.
From founders to organisations and local government, Bryant (PreSeed Now) said there should be more emphasis on building and sharing international networks to help Manchester “bolster its position”.
For Cropper (Kaboodle), he’d like it to be easier to create connections and networks, with the belief that better connections could give talent a real edge and help people and businesses solve problems together more effectively.
From Russell Cooper’s (MHA) views on every industry needing to “embrace” entry-level jobs to Mullany (MHA) calling for more coordinated support, Davies (PXN Group) perhaps best summed up the mood in the room.
“I think we need to look at the North of England and Scotland like it’s an investment opportunity, and think about how we present ourselves on the world stage. Whilst we have good investors here, we can’t fund it all, right? So we need to look at how we get people to want to come here.”
He added founders, including those from more diverse backgrounds, need more help to reach the £1m revenue mark. But getting to that first £1m is a “bit of a knife fight”.
“We need to celebrate our wins for longer, look at those failures in a more forgiving light, and we need the next batch of those scaling businesses that are the gold standard.”
