Following the recent publication of Ian Dowson's report 'Deep Knowledge is Powering another Regeneration of London', an in-depth investigation into the current state of the ecosystem of digital industries within the London geographical area (Tech City especially), this is the first in a series of articles by the report's author to aid understanding and stimulate insight as to how all stakeholders can create value from this evolving cluster of technology businesses and technology-enabled creative industries businesses.
Is something happening in London? Has a “Digital Curtain” descended on London from Stockley Park in the West to the Olympic Park in the East? Apparently new businesses are being formed at what appears to be an unprecedented rate; older existing businesses are being completely and extensively reconfigured. Hardly a day goes by without news of another new start being funded to the tune of $1m-$4m. Is London as a city rebuilding itself as it did around financial services and Canary Wharf in the 1990’s? Could it be that this time it’s the city’s media, advertising, internet, telecommunications, video, music, design, fashion and software industries, “the creatives”, who are spearheading an industrial and societal change as profound as that of the swinging 1960’s?
Or is all of this just another internet bubble soon to have cold water thrown over it? Media hype, self serving vested interest, publicity machines creating a storm in a “skinny latte” to increase Facebook, Twitter or LinkedIn page usage —“East London, Olympics, Tech Media Boom. Read all about it!” Is this myth of a tech boom being peddled to encourage take up of angel investing rounds, or by sinister investment banker types hyping sales and purchases of Web 4.0 businesses at stratospheric valuations? Because surely everyone knows “creatives” cannot do business and they certainly do not have a clue about technology.
I concurred entirely with these views until I started to interact with some of the humans involved in driving this change.
My day job is in the finance world, facilitating the process of sale and purchase of businesses, dealing with the finite detail of diligence or full stops in legal agreements or long circular arguments about definitions in accounting standards. Taking on a project in the media industry I was confronted with the assertion from everyone outside of the business that the internet would shortly cause the death of this organisation. From my point of view it did not seem this way as the financial performance of these media assets was strong, with large cash flows, good management and strong brands. The company managed its digital media assets well and they produced good profits.
My career began as a Graduate Trainee required to manage a very small part of a fibre optic cable TV experiment to the home. Overseeing the day-to-day running of this operation involved deciding the number of TV channels customers would like — 20, 50 or 100? Was it possible to bury fibre optic cable and where did you put the amplifiers? And the holy grail of network system design—was a star configuration better than a loop? Subsequently I worked in a business that was 100% dependent on sports media and then I went into corporate development for a UK/US Group than actually made things. The result of these early-career professional experiences was that I came to acquire a fascination about the relationship between content and technology.
Thus when I set about to undertake this media project, my main resolve was to find out what the noise around London’s digital media world was really about. Was it just a myth, smoke and mirrors, a cash burn in Private Equities latest frying pan? Or was there something more profound, deeper at work.
Going to meetups on evenings in Shoreditch, Brick Lane, and Old Street was intimidating for this middle aged man wearing a blazer (the blazer soon went). What was all this meet up, pitch, process stuff for? One thing very noticeable was that people actually came up and spoke to you. This simply was not British. What was I doing? Why? Wasn't this in-one's-face type of communication a bit old hat? The pitches of the usual 5 or so businesses presenting in an evening were often greeted in silence or with strange yelping screams. Two of the five pitches would be disorganised and unintelligible, one completely left-field, leaving everyone confused. But two would be excellently worked out and presented.
When I talked to the people behind the best presentations and started to probe them on the market for their business proposition, I would usually get back a concise in-depth 90 second pitch (lecture) on the subject. This nagged at me for a year or two; it seemed that maybe 10-15% of the start ups were the brainchilds of what appeared to be the top 1-2% graduates who really understood their target markets and could do better business plans in 90 seconds than I could. I should add that I had been putting business plans together for over 30 years.
Finally, two incidents occurred. Firstly a discussion with a space and systems scientist (a real rocket scientist) on whether debt was a form of stored energy bringing forward economic activity today on the basis of future cash flows (energy), the application of quantum physics to economics by a man in a start up Hub! Secondly, standing in the middle of a dark bar in the old Truman Brewery complex in the wind down after a Friday night pitch evening, a man suddenly pulled out a roll of Japanese rice paper, a brush and some ink. He proceeded to produce an absolutely beautiful picture of a body in what appeared to be less than 30 seconds flat — “You have to have a free flow of energy” he said. I then had a few words with this person on whether natural language processing in a commercial high volume call centre environment would work as a mechanism to sort voice data.
I snapped — that was enough! Were these people aliens from another planet? What were they doing? Why were they doing it? Who was financing them and why? I resolved to research in detail what actually was going on and gather some hard facts. This led to an intellectual journey of curiosity producing a 36,000 word report called “Deep Knowledge is Powering another Regeneration of London” The writer had never produced a report than long on anything before that did not have the words Strategic plan, Budget, Diligence, Report and Accounts or Internal Audit Report emblazoned on the front of it, strange?
Ian is the Principal of William Garrity Associates Ltd, a boutique consultancy specialising in Digital Media, Clean Tech and the Project Management of business disposals. He has managed large data centres, system implementations and highly complex system disconnections, including over 20 disposals and a similar number of acquisitions for UK listed Plc’s in the UK, USA and Europe. For 13 years he managed the Corporate Development effort of a Group of UK and US SME’s, B Elliott Plc, in the UK, USA and Far East. This involved getting into the details of the development of vehicle smart grids, clean tech inverters, LED measurement systems, camera on a chip, Korean industrial distribution systems, as well as traditional manufacturing. Previously working for Hilton Group Plc and Rediffusion Plc, Ian started his career at Glaxo Plc in a plant manufacturing antibiotics. He is a lifelong evangelist for Science and Technology education. He is also Qualified Accountant, FCCA and MBA.