Landing and meeting the locals
As a fast growth VC with global plans, the decision to land and expand in Manchester was not taken lightly. Months of research went into a number of factors that would determine how quickly we could become operational, how we’d need to adapt our services, the size of the market, and the scope of opportunity to positively impact the startup community here.
But like all big steps in life and in business, until you take that leap, you never really know how it’s going to play out.
What did we learn from Month 1 in Manchester? For a start it’s been one of the most rewarding of my career. I’ve barely had time to blink, but have been taking mental notes at every step and I’ve finally managed to collate them into some key observations.
The Manchester and North West tech startup scene is growing, fast.
The North West’s digital economy is worth £4.9billion annually, and 68 startups launched in Manchester in the past 24 months*. Nearly 3 a month. Not bad for a city with a population of only half a million. As part of the wider tech context here; Amazon has confirmed plans to open a major new office in Manchester in 2019, creating 600 new technology and research jobs. That growth and investment in Tech in the North West is predominantly what brought us here.
*Statistics from Technation and Dealroom.
Co-op-etition. Like Competition, but better.
Being new to the UK and Manchester, getting our message out was top of the list and first port of call was attending as many meet-ups and events as possible. The meet-up scene in Manchester is booming and it’s common knowledge that Northerners are a friendly bunch. But I’ve been blown away by the openness of the people I’ve met to introduce and refer me to their network, and it’s been one of the high points so far.
With any growing economy there’s going to be opportunity, and opportunity creates competition. If that becomes malicious it can turn into a ring fencing race or bidding war. But Manchester’s startup community is just that, a community. We’re not going to be right for every startup, and every startup isn’t going to be right for us. Everyone I’ve met has been happy to refer us on to someone, or multiple contacts. We’re excited to contribute to the ecosystem here and build strong relationships and partnerships that benefit everyone.
So my word of the month has been Coopetition. “collaboration between business competitors, in the hope of mutually beneficial results.” It really is a word as well, I’m not making it up.
Growing pains for Seed stage startups. Is the chasm between Angel to VC too big?
I’ve been fortunate to spend many hours 1-on-1 with a host of founders since we launched. Outside of learning a huge amount, one common problem keeps raising its head. Funding.
Many of the founders I’ve spoken to have done the initial hard yards. They’ve conceptualised their idea, formulated a business plan, invested their own money (and hundreds of hours), and taken the bold leap to release it to the world to get it off the ground. But there’s a big £ shaped hurdle to clear .
On first impressions, Manchester has a strong Angel investment community, and Founders have explained it’s relatively easy to secure £50k of Angel funding, but the gap to VC funding (circa £1million plus) feels too large. Many founders are not looking to raise meteoric amounts. They’re looking for that initial injection of capital (six figures), and to have a trusted partner to enable their first wave of growth. To take them from a Founder/Co-founding team with a dream, to a small-scale startup with the strategy, processes and support in place to grow, and ensure their business is stable.
And that fundamentally is the challenge that Black Nova help Founders navigate. For more information about what we do, and how we can help your business, get in touch or explore our site.
There’s more to come from us in Manchester, and we’re already well under way for month two.