Edinburgh Is The Perfect Place For Eager Founders

Edinburgh benefits from Scottish impressive startup support systems and from the United Kingdom’s business ecosystem as a whole. The city is now emerging as the largest British technology hub outside London and it has the 3rd largest number of startup ‘unicorns’ per capita, after San Francisco and Provo UT.  2765 new startups emerged in Edinburgh in 2014 alone. The city is a thriving centre for science, technology and fast-growth startup companies.

It is home to some of the best universities in the world, including the University of Edinburgh. If big cities, like London, scare you, Edinburgh is the right place for you, with population around 500,000 people and not so stressful environment that endorses innovation. In fact, Scotland has produced more than its fair share of innovators over the centuries. John Logie Baird developed the world’s first practical, publicly demonstrated television system, Alexander Graham Bell is credited for inventing the first practical telephone. Others include Alexander Fleming (penicillin), Robert Watson-Watt (RADAR), Charles Macintosh (waterproofing), John Shepherd-Barron (ATM), John Loudon McAdam (tarmac) and many more. But Scotland is looking for new innovations. They want to compete globally, at least this is the feeling you get when you move to do your business there.

Since Skyscanner, Edinburgh’s startup ecosystem has seen a lot of positive changes. It is easy to network with mentors, other entrepreneurs and potential clients. As Mr Gareth Williams points out, in an interview with The Next Web (TNW), Scotland doesn’t have the same wealth of high profile tech startups as London, but when a company does succeed, it stands out more.

The Capital City Of Scotland – Edinburgh

Advantages Of Starting Up In Edinburgh:

• It is easy to get into the entrepreneurial spirit and engage with the city’s society while attending networking events as most people you need to get to know are going to be there.
• Traveling around the UK and to other European countries is easy and very affordable. You can do it by bus, train or plane.
• Constant supply of excellent talent from the four Edinburgh based universities.
• Edinburgh is the second best city to live in Britain, with high average salaries, low unemployment levels, and an overall safe environment.
• The city is relatively small so it’s easy to get around on foot, by bus, taxi or Uber.
• You can use services such as Interface, a free matchmaking service connecting businesses across all sectors quickly and easily to world class knowledge, expertise and research facilities available in all of Scotland’s universities and research institutes.
• Edinburgh builds on 400 years of innovation. Industry and academia constantly continue to innovate across Financial Services, Life Sciences and Technology.
• Business Gateway is a service that provides you with advice and mentoring for your startup. It is publicly funded and cost free.
• There are also many incubators in Edinburgh. You can find more information about them on the website and in this guide’s ‘incubators’ section.
• You can access free training and advice through Interspace, a project funded by the EU, Edinburgh City Council, The University of Edinburgh and Edinburgh College.
• What is more, you have an opportunity to meet and work with people from all parts of the world, the diversity is amazing.

What Startup Founders Have To Consider:

• Living expenses can be high, starting from £350 p/m for accommodation (a room in a shared flat) and even that is a bargain. Besides accommodation, the council tax is higher than what the equivalent is going to be if you live in a smaller city. You can always find cheap ways to go by, like shopping from Asda or Lidl.
• Funding from Edinburgh city doesn’t come in often, especially for series A. Most of successful startups are funded by external investors.
• The small business loans provided by the local council don’t apply to startups, because they are high risk (if you are not high risk you are not a startup though – “A startup is a company working to solve a problem where the solution is not obvious and success is not guaranteed,” says Neil Blumenthal
• The technology scene is fast growing and crowded, therefore, it could be challenging to develop something completely new, challenging but not impossible.

Summing up, Edinburgh is a modern city with a number of strong industries such as finance, technology or tourism. The city offers a lot of talented people, coming from four world-wide recognised universities, making sure that, as a new and growing business, you will be able to cover your operational needs.
If you are bootstrapping, the living expenses can feel a bit high, but they are definitely lower compared to cities like London. If your business requires you to travel, Edinburgh airport offers reasonably priced connections with most European countries. In fact, during the 3rd Annual City of Edinburgh Council Conference, big part of the discussion was devoted to the issue of how to develop the airport’s connectivity even further through partnerships.

Although people and the media show a lot of enthusiasm for the tech industry, most do not understand it fully. If you want to start a technology company, make sure you pitch it as simply as possible and be patient.

Edinburgh has always been a pioneer in innovation. In addition to that, the society likes to support local businesses. Those two things, for sure, will give you that extra push that you need in the beginning of your entrepreneurial journey.

Step #1 Dive Into Edinburgh’s Startup Community

Edinburgh entrepreneurs have a sense of pride and they really want to prove that they can compete internationally. To achieve that, entrepreneurs, universities, city council itself are sharing knowledge and resources with everybody. Let’s take Codebase, a company that claims to be UK’s largest technology incubator, as an example. On their landing page you can find a calendar filled with knowledge sharing and networking events.

There is a plethora of regular meetups, pitching competitions and many more similar events. A very interesting group of entrepreneurs that you can join on monthly basis is the Heroic Entrepreneurs Open Meetup. During the Heroic Entrepreneur meetups, the attendees get the opportunity to share what they do or wish to do in a secured and friendly environment.

You can find everything you need on the web, all it takes is a google search about the events. More details and links are also provided in later sections of this guide.

Find Info About Upcoming Events, Meetups & Other Occasions:

• There are several Facebook groups you can start from in order to connect with other local entrepreneurs and startups; small ones such as the “How to start a startup” or bigger ones such as the “Edinburgh Entrepreneurship Club (eClub)”.
• You can find many events in the Edinburgh Open Tech Calendar.
• Edinburgh Startup Grid Meetup page.
• The Edinburgh Entrepreneurs group on LinkedIn 6K+ members.

Regular Events & Meetups:

• Heroic Entrepreneurs get together about two times a month, it is very easy to become part of the community if you are an entrepreneur.
• Lean Agile Edinburgh group has one meetup a month.
• Startup Grid holds one event a month as well. The meetup has as a goal to improve the chances for success of its members by learning from others stories.
• Investing Women is organising many events throughout the year. For example “A Day with The Angels” once a quarter in Edinburgh.

Yearly Or Major Events, Festivals, Conferences:

• The StartupSummit, according to their website, is the place where world leading business figures meet startup entrepreneurs, share stories, pass on advice and learn from each other. The event takes place once a year.
• Scottish Edge is a funding competition that is open to many different kinds of startups. There are 3 categories for which you can sign up. It is hard work, so you better be prepared. It is okay to fail, you can apply as many times as you like. It has up to 2 rounds per year. It is also a major opportunity to get training, meet other startups, mentors and investors. What is more, it is a great chance for free press coverage too.
• If you are a female investor and/or entrepreneur the ambition conference & growth is a unique, two days conference organised by Investing Women, a growing community of women angel investors; women entrepreneurs seeking growth and those who want to help both.
• The annual SMart Conference is an amazing opportunity for all tech entrepreneurs. According to their website, SMarT – The Skyscanner Marketing and Tech Conference – brings together key industry influencers from the Internet economy sector at both national and global levels to discuss the increasing success of the European technology industry.

Volunteering Possibilities:

• You can always try and become a writer for Startup Grind by clicking on “get involved” on the top right of their landing page.
• You can also try and volunteer for Scottish Institute for Enterprise (SIE). The challenge is that they prefer to work with higher education students that attend Scottish Universities.
• You can always volunteer as a mentor or a worker on The Startup-Student-Link. Mentoring takes place mainly online so you can start doing that even before you have moved to Edinburgh.

Step #2 Find The Best Coworking Space In Edinburgh

Edinburgh has a number of co-working places for all categories of entrepreneurs, from technology to social enterprises, from freelancers to teams.

When you work in a co-working space, you become a member of a community. You get access to fellow entrepreneurs, who know the scene a bit better than you do, you get access to a number of events where you can promote what you do, and you get to know the city faster.

Co-working Spaces In Edinburgh:

• Codebase claims to be the largest technology incubator in the UK. They offer monthly fixed desk cost of only £167 + VAT, open shared rooms as well as private office spaces. A lot of events and workshops take place at Codebase’s headquarters, providing great networking opportunities. Codebase is a good option for techies, startups, events, and workshops.
• Creative Exchange is Edinburgh’s new collaborative business space for creative and digital innovation. The prices vary from £200 up to £270 per month, depending on how often you want to use your office. It is recommended for creatives, events and workshops.
• Kingsford Office has opened its doors in September 2015. Prices start from £100 so it is affordable for most. It is recommended for Professional Services businesses.
• The Melting Pot stimulates and supports social innovation. It’s targeting social companies and the monthly fixed desk is only £290 + VAT. You can also rent “hot desks” by the hour, only £3.35 + VAT. Recommended for Social Enterprises, events and workshops (although everybody is welcome to apply for space).
• Nexus claims to be a business space for creative minds. It’s located in the heart of Edinburgh and it allows its residence to move around the building to stimulate their creativity, instead of just limiting people to their offices. You can make a price enquiry on their website.
• Silicon Walk is located in the city center. It doesn’t target a specific type of businesses so there is a variety of businesses sharing space in their offices. Make an enquiry about the price on their website.

Step #3 Tank Your Budget In Edinburgh

If you had managed to save money before you decided to launch your startup, then you can possibly fund your business. Hopefully your savings can keep you going until you reach your MRR targets (MRR=Monthly Recurring Revenue).

Unfortunately, that scenario rarely happens. Most startups need to rely on resourcefulness instead of resources to grow and develop. It is a good ideal, for example, to practice your ‘begging act’ so that you have a higher level of success when you beg your family and friends for money.

Luckily, a lot of people are working hard to make sure that startups in Edinburgh can get funding and accommodation without the need to beg. You need to work on your value proposition and pitch, though. You need to work until you bleed.

Edinburgh’s case is interesting. There is a number of incubators, but not that many accelerators yet. For an early investment you probably need to rely on Angel investors, but make sure that you know your numbers before you approach them.

There is always something new going on in Edinburgh and Scotland when it comes to funding and business help. You can always rely on Business Gateway, they’re always helpful.

Don’t forget that being an Edinburgh based company gives you access to grants and investment opportunities which are available UK wide. You have a list of some of the available options here.

Incubators:

• Entrepreneurial Spark is a free incubator, funded mainly by the Royal Bank of Scotland (RBS). They don’t invest money but, if your application is successful, you get a free office for 6 months with the possibility of prolonging the lease for another 6 months. So, potentially, you can get free office space for up to 12 months.
• Out of the Blue is an incubator for people involved in arts. It provides space for performances, networking opportunities, training and a sense of community.
• The Edinburgh Technology Transfer Centre provides a well-funded university facility for spin-outs and startups. If you are not an Edinburgh University spin-out, you might need to pay a small amount of money in order to use the facility and its services, but it does offer training and more.
• Edinburgh BioQuarter – Nine is a joint venture between Scottish Enterprise, the University of Edinburgh and NHS Lothian. It is designed specifically for rapidly growing companies in Scotland’s Life Sciences sector and inward investors wishing to engage with the expertise on site. The project opened its doors in 2011 and you can find all the information you need on their website.
• The Melting Pot provides an incubator program, where you can use their services for free. The message on their website suggests that you need to be a non-profit organisation but they say that they accept applications from all sorts of organisations.

Accelerators:

• SII Award is organised by the Melting Pot. In contrast to their incubator program, you do not have free office access but you get opportunities to network, exhibit at the University of Edinburgh and receive mentoring and 1-2-1s.
• UP Accelerator is an equity investment accelerator program. If you need a small investment to help you accelerate your startup’s growth then check it out. It is suggested that you check their f6s page as well. They offer £25k in exchange for 12% of your company.
• The Startup Race is an online accelerator. It gives startups an opportunity to access and follow the elite startup formula, available only to selected USA university students and USA big startup accelerators. The startup race model is going to help you go to the next level from the comfort of your home.

Grants & Subventions:

• Foundation Scotland offers a range of grants for companies whose aim is to help Scottish society by investing in an activity that local people believe will make a difference to well-being and happiness within their community (this one applies only to Edinburgh). The grants vary from as little as £250 to as much as £10,000.
• Princes Trust normally offers low-interest business loans. They also offer startup business grants in special circumstances. You’ll need to contact them directly to find out if you are eligible.
• Creative Scotland is the public body that supports the arts, screen and creative industries across all parts of Scotland. There are a number of funding opportunities for creative companies that are based in Scotland.
• Firstport offers 2 kinds of awards for social enterprises. The first is the “Start It Award”, where you can apply for up to £5,000 start-up costs to pilot your idea. The second one is the “Build It Award”, offering funding of up to £20,000 to cover an individual’s salary/living costs for one year, so that they can begin running the business full time. In some cases an additional £5,000 discretionary funding is available on top of this. The “Build It Award” is designed for individuals who have already piloted their social enterprise idea (either with or without support from the “Start It” programme) and have proven that the concept works.
• Scottish Edge is probably one of the most competitive, if not the most competitive, funding competition in Scotland. The winners can get up to £100,000, half of this amount are funds that you do not need to return, and the other half is given in a form of a low-interest loan. The cash is meant to take your business to the next level without the need of giving any shares away.

Crowd Investing Platforms:

• LendingCrowd is Scotland’s first peer-to-business crowd-lending platform based in Edinburgh. The crowdfunding business allows investors, who are seeking attractive returns from 5.95% to 12.25%*, to invest in the UK small businesses.

Angel Investors:

• Investing Women is a growing community of women angel investors, female entrepreneurs seeking growth and people who want to help both. Talking with Jackie Waring, founder and CEO of Investing Women, one can soon realise that they invest much more than money into businesses. They hold many events throughout the year. It is easy to get to know the organization if you attend some of them.
• Archangels, according to their website, has been at the forefront of early stage investing in Scotland for more than two decades.
• A list of some individual investors can be found on the Angel.co website.
• London and Scottish Investment Partners is a group of investors from Scotland and London. They invest in established companies (at least 3 years old). If you match this criteria check them out.
• Apollo Informal Investment is another opportunity for funding for startups. Apollo Informal Investment, as opposed to London and Scottish Investment Partners, is investing in start-up and early stage companies in Scotland.
• Alida Capital International (ACI) is a prominent Scottish business angel syndicate focused on investing in Scotland’s life sciences sector, specifically biotech and pharmaceutical companies.

Venture Capital Investors:

• Equity Gab is a group of private investors who are mainly investing in young companies that have achieved the SMART award and businesses that have gone through a pre-investment commercialisation process.
• Par Equity is the venture capital firm that helped Mallzee close a £2.5 million investment in July 2015. You need to be highly innovative and able to show that you can offer a high return on investment to be considered for help.
• Leading Venture Capital is a UK-wide venture capital firm. It has 3 main offices, one of which is situated in the city of Edinburgh. They invest in innovative high growth companies with world class potential across the technology, healthcare and energy sectors.

Other Investment Opportunities:

• Princes Trust also offers low-interest loans, at a rate of around 6% APR.

Step #4 Look For More In Edinburgh

As mentioned in previous parts of the guide, there is a lot of free recommendations that a startup can get in Edinburgh.

The tax system in Scotland is very much the same as in the rest of the UK. It is simple and fairly helpful for startups and businesses. You can find all the information you need at the local Business Gateway office free of charge. You can also look for information and register your business easily on Gov.uk.

Make sure you find other growing businesses and try to get in-touch with the founders. The founders usually will not mind offering you 30 minutes of their time once a month, despite how busy they are. The reason for that is the city’s entrepreneurial culture and society.

Sign up for public speaking clubs and other groups of your interest. You can find pretty much all of them on Meetup. Becoming a member of a group of people who have similar interests as you helps to broaden your knowledge and boost your business connections.

All things considered, there are a lot of activities in Edinburgh when it comes to entrepreneurship and startups. Feel free to get in touch with the author of this guide, Anastasios Pardalis, and ask him further questions regarding the entrepreneurial life in Edinburgh.

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Many thanks for contributing to this guide to Anna Różańska

Last updated: August 2nd, 2016

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