How will Virgin San Francisco flights help Manchester tech?
The securing of direct flights between Manchester and San Francisco could boost the UK city’s tech credentials – but it won’t be easy.
That was the message from some of the key figures involved with the North West city’s digital industries when BusinessCloud spoke with them.
Virgin Atlantic will become the first airline to provide the service, starting in the summer of 2017.
On the face of it, the flightpath will provide a huge fillip to the north’s tech sector, especially around attracting investors.
Katherine Lofthouse asked several senior tech figures why direct flights are so important.
Nick Horrocks, director, GP Bullhound
“The flight means the flow of people and ideas becomes more efficient. It is now more efficient for a top Silicon Valley exec to spend time flying to Manchester to visit an investment opportunity or one of his/her investments. This could mean the difference between an investment happening or not happening. Start-ups are typically funded locally and the more we can do to foster and support the early stage and start-up community, the better. The knowledge that there is secondary and follow-on funding available from the Valley should further incentivise the start-up and early stage community.”
Ged Tivey, managing director of Relentless Group
“The appetite to engage with San Francisco will be huge but we need to ensure that science and sanity are still the deciding factors in any venture, not Silicon Valley stardust. We have to convince them that this is the place to do business, not just a place they can fly to. Flights here are only part of the story. With the direct flights, Manchester becomes a new market for ideas. Businesses need to be mindful of this and ensure that we are not just the shop window for concepts that have already failed to gain investor buy-in.”
Steve Purdham, chairman and founder of Cheshire-based 3rings
“At the end of the day it’s about business; what you have to present to the guys over there is the chance to experience great people, great tech and great opportunities. We can’t be complacent because a transit link is just a method of convenience. We have to shout about our successes and what’s here, and also to just get on and do things. When we are out in Silicon Valley we need to be talking about Manchester and talking about the upsides. We tend to be conservative about it, which is very un-American.”
Jim Carroll, CTO of Wilmslow-based software development company Mobica
“There’s nothing like seeing people face-to-face to do business - phone calls and emails only go so far. Mobica is a high-tech business with 1,000 people in various locations globally and we work with lots of companies operating out of Silicon Valley, yet we almost never use video conferencing. It’s not until you see the whites of people’s eyes that you really start to trust them. And, of course, when you are going to do deals worth hundreds of thousands or millions of dollars you like to know who you’re dealing with, and you don’t get that over a video link. I also get more done when I’m over there than a week or month’s-worth of phone calls here, because of the time difference.”
Paul Gouge, CEO of Wilmslow-based mobile games firm Playdemic
“We need to be wary of trying to recreate Silicon Valley in Manchester because that’s not what we’re about. Equally, there’s a strong cultural influence that exists over there that could help our understanding of making a successful entrepreneurial environment. In my experience of being over there, there’s a different risk approach; starting a business, especially tech, is an admirable endeavour over there. While that’s becoming more common, it’s still rare here. Also, until now it’s been a case of companies approaching VCs and chasing them down, whereas in the US they VCs are proactively trying to find great ideas. If you’re a start-up, book ahead for a cheap ticket and make some meetings; share your ideas and see if there’s an appetite for a trade partner, investor or collaborator – we need to be doing that at all levels of industry.”
Technology consultant Phil Laszkowicz
“Currently San Francisco is going through a difficult transition, with over-priced accommodation and more risk-averse investors and VCs. Investors are more aware of international prospects than ever before and are looking for easy-reach prospects at an international level to sustain this difficult period in Silicon Valley. Innovation puts a city on the map and Manchester has yet to prove itself in this space, despite plenty of hyperbole from some of the community members. If it does not prove its potential as an investor target, then it will miss a huge opportunity and what could have been exceptional investment growth will end up as a mediocre improvement to the region.”
Graham Pearce, director of technology, media and telecoms across the north at KPMG
“If you look through history, it is transport and infrastructure that paves the way for industry. Even though technology brings people closer together virtually, there is still little substitute for face to face contact which facilitates relationships. Better transport to and from the North, and within the North itself, is all critical to success. I would encourage aspiring entrepreneurs in the tech sector just to go out to the West Coast and see what's out there. Some of it will be a revelation, but some is likely to highlight that there is no reason why we in the North of England can't be competitive on a global scale.”
Dale Huxford of Squire Patton Boggs, who previously worked in Silicon Valley
“I wouldn’t look at the flight as an opportunity for companies in the north to abandon plans to build long-term here because it’s not going to make that any easier. Continue building the good companies that are here but consider the Bay Area as a viable acquisition target rather than having to move companies to the US and then get acquisition. I really like the north as a tech hub because people don’t want to drop everything and run to Silicon Valley at the first opportunity – they’re building real companies that intend to be here long-term.”
Chris Blaxall, CFO at Newcastle-based online marketing technology provider Performance Horizon
“There are a great number of companies already pushing forward in the area and this is another element of helping them rather than something to explode growth; I don’t see that happening from the flight but I do see it as another positive step. I think the more that we as companies in the UK can talk and work together this is a great way of ensuring we continue to make progress. The US is such a large marketplace that it’s always challenging to grow a business there, so more links and communication, and communication amongst companies in the UK, is a great way to look forward.”
Garry Partington, CEO and co-founder at Manchester-based RealityMine
“The main benefit is meeting other companies; the ability to go and, relatively cheaply, attend events and conferences in Silicon Valley to meet with people. It gives a chance to understand other customers and competitors, and a chance to network. Get over there and meet people. One of the things that frustrates me is a lot of northern businesses sit on their laurels and expect people to come to them. We need to get out and about, and part of that will be trying to entice people from there over to come here and also make sure that people from here go over there and let people know what’s going on.”
Adrian Reed, managing director of Manchester-based investment bank Altium
“It’s important to remember that just because you have a US investor who’s interested in you it doesn’t mean you’re necessarily going to achieve the right outcome. It’s the same rule as always, if you use the right advisor and get the right process in place then theoretically you’ll end up delivering better results than you otherwise would.”
Paul Ellis, CEO of Cheshire-based Wax Digital
“This is more of an incremental step but might fuel the possibility that one of the massively scalable businesses will be born in Manchester. People look to role models and if a Manchester business scaled massively, backed by a VC based in San Francisco, it would get tonnes more activity. What Manchester could do with is a posterchild business that’s grown at the same rate as something like Facebook or Google. If that happens Manchester would be seen as an international hub - the flight is one of the things that will help. Manchester in isolation is a great city for tech, it just needs to be better connected to other cities.”
Jack Brewitt, brand ambassador for Liverpool-based digital creative agency Draw & Code
“If I was an investor out there and now had access to the north I would think it’s a great opportunity to explore and find out more, because there are some really exciting tech companies here.”
Jack Barmby, CEO of Bury-based customer service software provider Gnatta
“This provides UK-based start-ups with the chance to broaden their horizons across the pond. A new travel link will also boost the tech industry in the north, as it provides businesses with the possibility to build connections with our American neighbours. Instead of just being a name in an email, start-ups can use this to set up face-to-face meetings and learn from the wealth of knowledge buried in Silicon Valley.”