London is the tech capital of Europe - let's keep it that way

Mike Butcher
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Countries that cannot develop AI systems will not remain competitive (Source: Getty)

Just like the silver Terminator chasing Arnold Schwarzenegger, technology couldn’t care less about Trump, Brexit or whether Theresa May can maintain a stable government or not.

It just keeps running at us. The quiet hum of internet servers and Amazon’s warehouse robots continues.

But luckily for us, London has kept pace with the future, becoming a centre for technology startups in Europe with a hugely diverse ecosystem of founders and investors.

Many of London’s tech founders are not from the UK. Taavet Hinrikus came from Estonia to co-found Transferwise; Andrey Andreev left Russia to bring us the dating app Badoo; and Marta Krupinska left Poland to co-found Azimo. All have built huge businesses in London.

But London can’t rest on its laurels.

A recent report by leading London venture capital firm Balderton Capital found that UK tech firms could soon face a staffing crisis, as they rely heavily on pan-European recruitment.

It found that the UK alone employs 31 per cent of those who work for European startups, showing the extent to which Britain dominates the European tech scene.

In London, some 40 per cent of companies have at least one founder from overseas, and the capital is the most popular destination for job hunters looking to work abroad.

However, Balderton commented that the weakness of the pound combined with developers’ drift towards “digital nomadism” (working from smaller, more affordable tech hubs) could diminish London’s allure.

While the UK remains popular, Germany and France are approaching fast. German MPs sent mobile advertising vans into geek-filled Shoreditch, extolling Berlin as a tech hub, and the new French President Emmanuel Macron is gunning for the tech and scientific minds put off by the negative connotations Brexit is sending, whether we like it or not.

At the same time, the future is arriving much faster than many thought. Around 20 years ago it was predicted that the Chinese game Go would not be won by a machine for at least 100 years. Google-owned Deepmind completed the task just last year.

The combination of robotics, artificial intelligence, machine learning and other technologies is about to transform our lives and our cities. McKinsey predicts one company in five is using a business model which will fail within five years. Forrester predicts that millions of manual jobs will disappear in the next 20 years, and even some white collar jobs like accounting will go, eaten up by AI and the Blockchain.

This is why London must continue to make itself attractive to global talent. The race for complex systems to drive AI is greater than ever before. Countries that cannot develop AI systems will not remain competitive.

The news is not all bad. Even with Brexit, London will still have the huge financial institutions and family offices which act as the backers of its biggest venture capitalists. Meanwhile, the TechCity quango is rapidly expanding its “tech talent visa”. And “PropertyTech” startups are gradually addressing some of London’s issues as the high cost of living for cash-strapped millennials.

But we can’t rest on our laurels.

That’s why I continue to run events like The Europas Conference & Awards – held today during London Tech Week. Tech startups are notoriously tricky to assess at their earliest stages, which is why opportunities to network and pitch themselves to London’s investors are so important.

Brexit or no Brexit, political chaos or not, London is still the best city in Europe for technology innovation. But the AI-driven robots will wait for no one, and we must continue to attract the global talent that will develop them here.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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