The digital sector is flying - but how do you get your own startup off the ground? Brabners' Nik White explains
The UK’s digital economy is booming. The sector has an estimated turnover of £170bn, is growing twice as fast as the wider economy and employs more than 1.6m people. Contrary to popular belief, it’s not just London getting all the action.
As revealed in the Tech Nation 2017 report, the north is a hub of activity and well on its way to rivalling the capital. From Liverpool to Hull, and Leeds to Newcastle, the north of England’s tech sector has a combined GVA of £5.8bn, up from £4bn last year.
Our northern cities are home to more than 160,000 digital tech jobs and more than 1,900 start-ups are born here each year. The Manchester cluster has the fourth highest digital turnover in the UK at £2.9bn.
All of this points to a sector that is gearing up for growth. But for those setting up shop here, do they have everything they need to get off the ground and sustain performance?
For budding entrepreneurs, there are myriad things to consider when embarking on a new business venture but arguably the most important aspects focus on protection: protecting your brand, protecting your product and protecting your people.
Your brand is one of the most important assets you own and intellectual property (IP) rights are key to protecting it. The world’s biggest and most successful businesses closely guard their IP, understanding the dangers of losing control of their brand identity.
Take copyright as an example. Ownership of copyright lies with the creator, rather than the business that paid for its creation. So, if you pay a contractor to create something for you, such as a logo, you may not automatically have ownership of the copyright subsisting in it. If not addressed at the outset, this can cause a major headache further down the line. To avoid this pitfall, it’s important to stipulate in written agreements with third parties that you will own any IP they create while working for you and that all such rights are transferred to you.
Registration of trademarks is also essential. Trademarks help prevent others from using your brand and can give confidence to investors, which could ultimately help to attract funding in the future.
Once you’ve protected your brand, it’s important to protect the product too. The ownership of copyright is an important consideration in this area as well. If your product is software that has been developed (wholly or partly) by a third party, then you need to ensure you own it just as you do your logo.
As a young business, when cash-flow can be a headache, it can be tempting to give away exclusivity rights at the beginning in exchange for your first payday. However, unless the customer is paying a big premium, this needs to be resisted if at all possible.
If a tech business gives away exclusivity to a piece of software at the beginning of its journey, it is no longer able to white label that software or license it on to other customers – potentially taking away future revenue streams. Your brand and product should come as a package, and paying equal attention to both is vital.
Finally, arguably the most important aspect of your business is to protect your people. Employees are the lifeblood of any business and finding the right workspace for people to grow and develop is key. Not only will it help your business to retain talent, it can help to express your business’s personality and brand – something we will see throughout this year’s PN Inspired Spaces campaign.
Some startups experience rapid growth in the early stages of their development, so it can be crucial to choose a space you can grow into. Incubators and co-working spaces, such as The Landing at MediaCityUK, offer flexibility and collaboration at the beginning of your journey, allowing you the time to choose and develop a workspace that is truly fit for purpose.
While there’s no doubt that the northern tech sector will continue to go from strength to strength, as an industry we need to do all that we can to support our region’s startups. In doing so we will be able to firmly establish the north as a true tech rival to London.
Nik White is a partner and member of the tech, digital and creative sector group at Brabners