KPMG's Simon Collins: Look beyond the Silicon Roundabout buzz

The UK is currently buzzing with tech activity. From London to Newcastle, the entrepreneurial spirit is thriving and a growing number of innovative, aspiring and ambitious companies are laying down roots.

However, for all the buzz of ‘Silicon Roundabout’, we now need to get serious and move beyond an excitable culture of start-ups. The harsh truth is that the new kids on the block want to leave home when they grow up, heading for the more sophisticated tech centres of Israel and the US. It is important to nurture grass roots technology talent but it is the ‘grown ups’ of the technology world which generate jobs and revenue at scale. We must put a system in place which ensures the UK benefits from technology growth beyond the start-up stage.

Our own obsession with the next big thing is actually hampering progress. An exaggerated investor enthusiasm for exciting technology innovations is giving tech companies the wrong measures of success. A fresh idea or clever product isn’t the same as a good, long-term, viable business.

So what can the government do to give the UK tech sector the extra turbo boost it needs to catch up with its global competitors? Education is a good place to start. While the UK education system competes on the world stage, we seem to struggle to turn ‘book smart’ into ‘practical wisdom’. Employers often complain of a shortage of skills in the so-called ‘STEM’ subjects of science, technology, engineering and maths. Our international competitors have focussed on enhancing the level of science and technology being taught at schools all the way from primary through to tertiary levels. Israel’s schools, for example, have long focussed on science and technology as key differentiators and successive Israeli governments have viewed innovation as key to the country’s survival.

More advanced global tech centres have also fostered a culture of entrepreneurship where students and graduates consider starting up their own ventures as a viable career choice. Perhaps unexpectedly, the recession helped support entrepreneurship in the UK as graduates faced with lower job prospects chose to join fledgling tech businesses instead. We need to build on this as a cultural norm, not just as an unintended consequence of the recession.

A broad range of focused government policies could help develop education; encourage increased employment in the sector; international expansion and create tax breaks which allow businesses the ability to retain cash at critical points in the growth cycle. I don’t under-estimate the complexity of the task. There are some fantastic advocates in government already but, like infrastructure, an over-arching tech ‘tsar’ could navigate the system and bring together relevant departmental support in a strategic fashion.

A Budget with a package of measures to support the technology industry would be very welcome but, unfortunately, these will take time to embed and we don’t have time to lose. This is where the private sector and, specifically, big business comes in. UK companies need to support the SME tech sector, with mentoring, funding and access to customers. We are already seeing organisations such as Barclays, Tesco, Marks & Spencer and BMW supporting early stage technology companies through investments and partnerships. KPMG has also joined this mutually beneficial ‘eco-system’ of big business supporting small business, with our recent partnership with the Chelsea App Factory; the launch of our first investment fund ‘KPMG Capital’ and our office in Tech City. We can do our bit and we’re encouraging our large clients to do the same with ‘dating service’-type events at our Tech City hub, where we introduce large businesses to tech start-ups.

Clever and unified government policy – supported by big business – could earn us a fantastic prize in this global competition: a bountiful hamper of job creation, wealth, international investment, technological innovation and all for the benefit of society as a whole.

Simon Collins is UK Chairman of KPMG