Edinburgh is used to attracting thousands of visitors to its winding, cobbled streets, but now a slightly different crowd is arriving in the city, not in search of castles or comedy but business opportunities. The capital has become a magnet for start-ups, entrepreneurs and young companies looking to emulate the fortunes of outstanding success stories such as Skyscanner, FanDuel and Rockstar North, which all chose to make the city their home.
In recent years, clusters of businesses within the sectors of technology, life sciences and renewable energy have sprung up across the city and they are thriving. “There are a number of sectors that are strategically important in Edinburgh and indeed Scotland,” explains Eleanor Mitchell, High Growth Ventures Director at Scottish Enterprise, the main enterprise development agency in Scotland. “Alongside underpinning sectors such as tourism and food and drink, we have seen huge entrepreneurial activity in the high-technology sectors. The volume and quality of start-ups in Edinburgh is attracting a lot of private sector companies and more entrepreneurs to the city.”
Edinburgh benefits from a strong network of business leaders and a dynamic community that helps budding entrepreneurs to deliver their ambitious ideas. “Part of the challenge of starting a new business is ensuring that you have enough people around you that can help and business leaders will look to other business leaders for guidance,” says Eleanor, whose role at Scottish Enterprise focuses on developing entrepreneurs' very early stage innovative ideas. “Business leaders who have built and grown their companies here are now very willing to give their time to the next generation and even in some cases, put money into development.”
“The volume and quality of start-ups in Edinburgh is attracting a lot of private sector companies and more entrepreneurs to the city.”
Eleanor believes that entrepreneurs need to look outwith their own sectors to be innovative, and Edinburgh's strong business community facilitates collaboration between a cross-section of diverse sectors: “The greatest ideas come at the intersection of different sectors. In Edinburgh, there is a critical mass of people from different backgrounds coming together and those accidental collisions are really exciting. Take Symphonic Trust for example. It is a FinTech company, which originally focused on data solutions for life sciences, but now operates in Financial Services. You never know where the next high impact idea is going to come from.”
With some of the country's leading research centres and innovative incubator spaces that nurture spin-outs, Edinburgh's world-class universities also play a pivotal role in supporting the city's businesses. “The universities are very important to businesses in helping them to innovate through access to academic research and knowledge as well as providing them with skilled graduates,” says Eleanor. “They are important to Scottish-based businesses but also help to attract the interest of international businesses which may go on to work with the universities and bring their business knowledge and networks to Edinburgh.”
Of course, a vibrant and supportive community alone isn't enough for new businesses to flourish; they also need financial support. Scottish Enterprise offers support through grant mechanisms as well as advice through dedicated account managers. Edinburgh's position as the UK's second largest financial centre outside of London also means that there are investors who understand start-ups. As Eleanor adds: “There are many angel investors in the city who have a lot of experience of supporting those early stage companies. A very healthy and strong network of investors is very attractive to companies here and the Scottish Investment Bank exists to help increase the supply of finance, and to assist more Scottish companies with growth and export potential to access it.”
Suffice to say that while Edinburgh offers a network of support, the city's unbeatable quality of life is another major plus point. “With its cultural and sporting events, the city is very appealing to people at a certain stage in their careers,” says Eleanor. “I come across lots of great business ideas every day, but for those ideas to become a reality, you need experienced individuals. The quality of life that Edinburgh offers is very important for young companies as they can then attract the best talent to come to work with them in the best city.”
Success stories in Edinburgh's growing sectors
- Life Sciences: Edinburgh Molecular Imaging A spin-out from the University of Edinburgh, Edinburgh Molecular Imaging is developing Optical Molecular Imaging technology that can help to diagnose and monitor several major diseases. Based at the bioscience community Edinburgh BioQuarter, the company recently secured £4 million in venture capital funding.
- Technology: Skyscanner The brainchild of Gareth Williams, Skyscanner was founded in 2003 after Williams found it difficult to find flights while travelling in Europe. With an estimated value of $1 billion, the flight comparison website has more than 60 million visitors every month.
- Renewable Energy: Albatern Headquartered just outside Edinburgh, Albatern has designed a product range called WaveNET which allows wave energy to be harvested in a more economically viable way. Albatern's funding partners include the Scottish Government, the Cabinet Office and Scottish Enterprise.