Britain is well known as the site of the world’s first Industrial Revolution, but until recently London – home of the scientific and financial revolutions that preceded industrialization – was rarely considered an entrepreneurial hotspot since then.
London seemed simply not to have captured the kind of world-class, innovation-driven entrepreneurship that has propelled Silicon Valley and Kendall Square to international acclaim.
Seeking to play my role in helping London recapture some of its entrepreneurial tradition, I took up a post in Fall 2012 as a Visiting Scholar at MIT Sloan on behalf of the British Government. For the previous five years, I had been Britain’s Consul General to New England focused on transatlantic business development and had moved the Consulate into One Broadway (aka E70) to deepen the links with MIT, Kendall Square and the high-tech sectors.
I had not started my project with a focus just on MIT: I had cast my net widely, interviewing students, entrepreneurs and faculty around greater Boston, from Harvard to Babson.
After much research, I zeroed in on the work of MIT Sloan, particularly its Martin Trust Center for MIT Entrepreneurship. Not only has the Center pioneered entrepreneurship education (e.g. in iTeams and Bill Aulet’s New Enterprises), but its Faculty Director, Professor Fiona Murray, has become a thought leader on how to accelerate entrepreneurship.
In my twenty years as a British diplomat, I had advised the government on a range of business topics. In the past several years, as British Consul in Boston, I had found myself focusing on science and innovation – specifically how to optimize the nurturing of what I now know from MIT to call “innovation-driven enterprises” (IDEs), those fast-growing, job-creating firms that make such a difference in a given ecosystem. Previously, I had looked mainly at the role of government, focusing on its policy options.
My 2012 semester at Sloan introduced me to MIT’s way of looking at entrepreneurship: an ‘ecosystem’ model focused on five interconnected stakeholders – universities, entrepreneurs and risk capital (of course) but also corporations and governments. What I took back to London was a clear analysis of why a government should engage all of the major stakeholders and help ensure there are connections among them. It gave me some practical suggestions for specific programs that the government could undertake. This work was capped off with a visit by British Prime Minister David Cameron to meet Professor Murray at MIT in May 2013.
Having learned about theories of entrepreneurship policy at Sloan, I was keen in Autumn 2013 to re-engage and share with MIT my own practical expertise in entrepreneurship policy. With Professor Murray, I co-taught in her Regional Entrepreneurship Acceleration Lab (‘REAL’) that looked at several exemplars of entrepreneurial hotspots, from greater Boston to Singapore, and the ‘catalytic’ roles that all the stakeholders can play.
And, of course, we looked at London too. For context, I highlighted the historical tradition of entrepreneurship in London, dating most clearly from the scientific and financial revolutions in progress by 1700. These lesser-known ‘revolutions’ paved the way for the world’s first Industrial Revolution that took place in Britain and was well underway by 1776.
Drawing on my experience in government, I focused the class on the practical implications (and challenges) of the MIT Sloan model of entrepreneurship-acceleration. What makes London’s recent re-emergence as a world-class entrepreneurial hub so interesting is the organic nature of its tech cluster (nick-named ‘silicon roundabout’), but also the thoughtful support of the government which came later in the Tech City initiative.
It was self-starting entrepreneurs, without initial Government support, who had created new enterprises in gritty east London neighborhoods (like Hackney and Shoreditch) through the economic downturn of the recession. Unlike some other governments, the British had managed to avoid either trying to create a cluster or playing a heavy hand in directing the development of an existing cluster. Instead, it enlisted other stakeholders and one of its successes was to help bring coherence to the ecosystem, under a new ‘Tech City’ umbrella, and leverage its international network to bring in to the ecosystem major tech players like Google, Facebook and Microsoft.
Whether just by serendipity or more likely design, the British Government has so far managed to avoid many of the traditional mistakes, and London is home to a growing number of IDEs. More of this Tech City story will be in the ‘case study’ to be published, and the story of MIT helping London goes on.
Phil Budden is a Senior Lecturer at the MIT Sloan School of Management, where he co-teaches REAL, in addition to his day job supporting transatlantic business development through financial services at RBS Citizens bank.