Building a startup scene is probably one of the hardest things that a group of tech entrepreneurs can try to achieve. It takes time, we are not talking about months, but years to try to let the wheel spin the other way around. Especially if you end up in a place where the word technology has never existed before or there are a few blobs of tech spread around the city. The key to build a community is to connect those blobs altogether and make them feel part of something.
Manchester, the second largest city in UK, is almost there. The city still doesn’t have the billion dollar valuation that is gonna bring more and more traction, but there are a few companies that have decided to be Mancunian for the rest of their lives. This means a lot in terms of what the city can be in the next five years. The biggest problem Manchester faces is the way talent leaves and never comes back.
With the biggest University in UK, and a few Nobel Prize winners, this city is a factory of talent. Every year thousands of people graduate and there is a tiny bit that decides to be entrepreneurial; the problem is that London seems to be more attractive and that’s why most of them leave. With a Computer Science department full of history, engineers should be able to stay and start building something or help those who are already building companies.
That’s why this city has already got one of the biggest assets that a startup scene needs, a great University. There is a reason why Silicon Valley is next to Stanford, a University that produces talent and encourages its students to stay, instead of leaving. On top of this infrastructure, Techhub and also (partially) Innospace are working to connect those single blobs that once were working separately.
At the same time, capital is moving to Manchester, because money goes where there is an opportunity to double it. AXM Venture Capital, with the North West Fund, has been investing in the area for several years and they are not going to stop anytime soon. However that’s not even an issue, because VCs don’t have to be based where their investments operate. London is a two hours trip by train, close enough to raise a few rounds.
All these factors are encouraging more people and already established companies to move to the next big european startup city. There is a reason why Uber has moved to Manchester. There is a reason why Hassle, after getting traction in London, has expanded its operations in Manchester. There is a reason why Hailo is about to launch in Manchester. There is a reason why all these companies are looking at Manchester and no one can deny that.
In the same way, companies such as The Nifty Mini Drive, Rormix, Formisimo, Fatsoma, Moment.Us, CANNDi, TechBritain and Capsule are making a point. In the last two months, Rormix raised an undisclosed seed funding that is going to give them enough time to double (or even triple) the 40,000 people they have on their platform and Formisimo, two days ago, has raised a seed of £350k from the North West Found, SeedCamp and other angel investors.
This is not a bet anymore, because it’s actually happening. What this startup scene needs now is a stronger relationship with the University of Manchester, because that’s the key to expand. Talent is already in Manchester, it doesn’t make any sense to try to attract or force people to move to this city.