SOMETECHFORTHEWEEKEND: With the recent arrival in London of new corporate-backed business accelerators, there’s apparently no shortage of help out there right now for tech startups. Yet it’s not just the startups that benefit, says Julian Blake
Late last month, in a tense finale not at all unlike the climax of ITV’s X Factor, teams from 30 carefully selected technology startups gathered in a building just off London’s Tottenham Court Road to hear their fate. At stake was access to the startup equivalent of the Cowell mansion – first-class office facilities, centrally located and clustered, along with expert mentoring, coaching and €50,000 in cash to fund their business idea.
The 30 finalists were seeking admission to the Wayra Academy, London’s newest business accelerator, backed by communications giant Telefonica. (London is just the latest location for an academy that Telefonica has opened successfully around the world.)
A process that had begun back in March saw more than 1,000 business projects come forward. Over the course of the following two months, these were whittled down to the final 30. Of these, just 16 would win access to the academy after the judges’ deliberations.
Among the winners, there are certainly some novel startup ideas. TrueView, a real-time dating service that will allow the ever-growing numbers of internet daters out there to create interactive and evolving profiles for better matches. Epicurely, a foodie social network allowing users to discover local dinner parties. And Night Zookeeper, a children’s entertainment and education site asking what it is that animals dream about.
My personal Wayra favourite, not because of its novelty value, is a practical telecoms startup called Touch Line Solutions, which sets out to minimise customer phone queues. I like it because its cofounder, Imogen Wethered, was sitting right next to me on finals evening. As the number of remaining places at the academy shrank, her stoic appearance was turning to disappointment, before turning to delight as her business snatched the very last spot in the academy. (I look forward to less waiting when I’m on the phone to O2 in future.)
Access to the Wayra Academy is undoubtedly a huge boost for these fledgling firms. And it’s been a pretty bold step of Telefonica to back the initiative. Yet, as Wayra Europe director Simon Devonshire told us back in March, this is certainly not an exercise in altruism. “It’s a partnership, but let’s be very clear,” he said. “We are doing this for commercial reasons. We are taking a vested interest in these startups.”
Those reasons are by no means hidden. Telefonica takes a 10% equity stake from the get-go, along with the first rights to future funding and the first rights to marketing the firms’ products and services. It’s a commitment that both sides probably agree is fair given the very early stage of development. Devonshire also pointed out that, unlike in other corners of his industry’s work (like consumer phone contracts for instance), Telefonica would not be attempting to lock firms in to an exclusive arrangement.
Telefonica is by no means the first, and surely won’t be the last, of the big corporate firms backing London tech startups. The tech daddy of them all, Microsoft, has been busy in the UK accelerator space for more than four years now. Its BizSpark programme, led by Bindi Karia, offers “software, support and visibility” to around 45,000 startups, with a premier BizSparkOne programme offering 100 of its “high-potential” startups a closer one-to-one relationship, including to Microsoft’s products. Microsoft’s extensive work with startups puts Telefonica’s into perspective.
Other corporates are taking a slightly different approach. This spring, of course, saw the opening by Google of Campus London, a large building in the heart of Tech City housing tenants that include Tech Hub, which offers startups cheap desks, meeting rooms and an event space, and the innovative accelerator and startup fund Seedcamp. While Campus is not Google’s BizSpark or Wayra, and its tenants generally have no corporate axe to grind, its presence at the heart of the London startup scene is clearly all about Google wanting to be close to the action, doutbless eyeing up opportunities.
Mike Butcher, the co-founder of Tech Hub, argued recently that the gains from corporate-startup relationships like BizSpark are very much two way. “In truth it feels like the more corporate the company culture, the more need there is for this kind of initiative,” he said. Big firms like Microsoft depend on “that essential startup DNA”, he said, as much as the small firms depend on them.
Perhaps it’s just hard to stay lean and hungry when you’re, well, not so lean and not so hungry any more.
One last bit of support is out there for startups unlucky enough not to have made it through to the Wayra final 16. A new gathering, “The Wayra Rejects Meet Up Group”, meets for its big “Rejection Party” on 14 June, to “celebrate our awesome ideas and focus on the future”.
You just can’t keep that startup spirit down, can you? Cheers!