The Guide To Found Your Startup In London

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Co-author: Josephine Goube Are you considering founding your company in London? Or want to gain insight on how the local startup community there works? Check out our Startup City Guide for Europe's leading hotspot for the startup industry.

Check out the infographic on how to start your startup in London!

London “has New York’s urban diversity, LA’s concentration of media, film, TV and creative industries and Washington DC’s proximity of government, all in one place” according to Joanna Shields, CEO of the government’s Tech City initiative.

Major multinational corporations and an entire generation of promising new startups are located in this mature ecosystem. London is also home to a massive concentration of angel investors, seed and VC funds as well as international accelerators. This creates a “perfect storm” when it comes to starting a new venture.

Going To The Island: London

London is often referred to as the startup capital of Europe. Surely, this title contributes towards numerous advantages for founders to start in this city.

Advantages of founding in London:

  • government support initiatives (grants and investment funds)
  • fiscal advantages of up to 72% tax relief for startup investors. Find more info yourself and save up on your tax advisor.
  • predictable and stable legal system
  • simple and inexpensive incorporation (24h/15GBP/online) or you can use one of the dozens of online services that will do this for you
  • online accounting services starting at 20GBP/month:
  • extended support system provided by universities, law firms, etc.
  • vibrant startup community that has an extensive network of mentors and investment opportunities
  • English is official language of both – the country and the startup community 😉

Things to watch out:

  • Office space is expensive (around 300GBP/month in an coworking space) and hard to get, you can use this guide but keep in mind that most places are overbooked.
  • Competition for talent is very high, which drives up salaries: expect to pay for an average developer in excess of 35k/year.
  • High cost-of-living compared to the rest of Europe: expect to pay around 1k/month for rent.
  • Noise-to-signal ratio, as there are a lot of angels, meetups, hubs and initiatives that don’t really add value.

Meet Start-uppers In London
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There is no shortage of events in London, no matter what you are looking for. The challenge is to choose the right ones for you. If you are new, try to understand the objectives and the community surrounding the events, this will make it easier to select the relevant ones.

Regular events and meetups:

By using the following links, you can find up-to-date information on what is going on in the community.

  • Eventhunt is curating lots of London tech and startups events and provides a broaden list of such events happening in London.
  • You can start by understanding the sheer volume of events by hitting up meetup.com and eventbrite.co.uk. I dare you to search for “startups” and “London”.
  • startupdigest keeps a nice calendar of relevant events.
  • Citystarters is a City University initiative. Do check out their Unruliversity!
  • Google Campus is host to a ton of events, you are bound to find one that suits you. You can also hang out in their cafeteria and mingle with fellow entrepreneurs.
  • TechHub is another place hosting dozens of events, even if some are for members only.
  • The governmental TechCity initiative can be another source for interesting events.
  • And probably the coolest startup events are those of 3Beards.

Big events & startup competitions:

  • Disrupt Europe is a two days long event that will take place on 20-21st of October 2015 and is powered by TechCrunch.
  • The Europas will be held on 16th of June 2015 and is the premier award for Europe’s hottest tech startups. It aims to connect technology startups, as well as leading investors and media in the EMEA region.
  • Noah Conference will be happening in November 2015, it focuses on connecting investors with innovative startups. Note: NOAH Berlin will be happening in June and co-hosted by Axel Springer SE.
  • Le Web London will be held in December 2015 and is an international conference devoted to the topic of digital innovation. The speakers are usually successful entrepreneurs from the US and Europe. Moreover, there is a startup pitch competition going on during the conference.
  • Seedcamp Week London aims to connect the 20 best web-tech, mobile and software talents with some of the leading entrepreneurs, developers, experts and investors from Europe and all over the world. Check out their updates for the event next year.
  • Startup Institute provides with a 8 weeks long program aimed to boost your skills and network needed to find your job in the startup community.

If you want to have a general overview of upcoming events happening in London check out moonbar app, it provides you with an interactive calendar of upcoming events.

Work In London
London_guide_coworking

Now that you discovered the local startup community and met people who may have become your team members it’s time to find a working place. London offers a variety of co-working spaces but here are – arguably – the most interesting coworking spaces:

  • The Hub Islington is part of a global network of 26 hubs and offers flexible time-based membership for spaces to work and meet.
  • Innovation Warehouse is an interesting mix: co-working space, incubator and accelerator. Here you can meet entrepreneurs with startups in all stages, as well as mentors and investors.
  • Central Working has 4 locations in London and also one in Manchester. Quite flexible when it comes to using their spaces and focused on fostering connections, as the people there come from a wide range of backgrounds.
  • Bathtub 2 Boardroom is located in East London, and it’s aimed for innovative and creative businesses who are genuinely excited by the idea of being surrounded by a community of like-minded start-ups.
  • TechHub provides startups not only with the coworking space but also with the networking environment. For example, they organise and host lots of events. Moreover, you can check out their multiple locations outside of London. Interesting to note, that they also offer private offices for startups from 4 people upwards (most commonly 8-12 people, but there are also larger ones for 30 and more people).
  • Rainmaking Loft provide a fun place to work. Among traditional sevices of coworking spaces like desk renting including meeting rooms they also make sure to create a collaborative atmosphere among the startups in the place. The spaces are also available in other cities like Berlin & Copenhagen.

Surely there are a few online spaces where you can find lists of coworking spaces and then choose the one that suits you best:

  • StartUs has a list of co-working spaces which is still growing.
  • Coworkinglondon will give you an idea of how many options you have when it comes to co-working spaces.
  • There was quite a lively discussion on Quora on the topic of best coworking spaces in London. You can check it out to get the perspective of fellow community members.

Get Funding In London
London_guide_financing.

Being one of the hottest startup cities in Europe surely puts local financing institutions, grants and programs into a lot of ‘money’ pressure from “great-startups-to-be”. At the same time after taking a look at the diverse possibilities this city provides, we can surely say that there are quite a few possibilities to tank your startup throughout different stages of its development.

For the ones being in the early stage of their startup trip there are more more than 30 incubators and accelerators. The Telegraph, for example, has created a dynamic map listing 36 major programs for startups from different sectors. Check it out to see their location and links.
At the same time there are a few who have earned especially positive treatment from the community members. Let’s take a look.

Incubators & Accelerators:

  • Bathtub2Boardroom provides early stage founders with a highly discounted office space. Moreover, they provide their inhouse startups with free legal advice and mentoring opportunities.
  • Emerge is an incubator for startups in the field of education. They provide selected startups which have the potential to improve educational environment worldwide, with a 3-month-long program (including 15.000 £ of living stipend).
  • Collider Accelerator offers a 4-months program for early stage startups focused on marketing and branding industries. Moreover, after the end of the program there is a possibility to raise an additional 100.000£ follow-up capital.
  • Level39 is probably the biggest incubator/accelerator physically – not just in London or England, but in whole Europe. Located in the Canary Wharf tower it has a lot of office space and selects startups from the sectors of  finance, retail, cyber-security and sustainable city technology startups.
  • MassChallenge provide free mentorship support and office space for 4 months. The nice thing is – no equity will be taken away.
  • TechStars London has been traditionally fairly broad in which startups it accepts into its programs. It pays particular attention to startups with the potential to have a national or global reach.
  • Seedcamp offers a 3-month program that comes complete with mentors such as Dave McClure, Eric Ries, and a number of angel investors, VCs, and mentors from Google, Facebook, Skype, Box, and more.
  • Healthbox aims to disrupt the healthcare industry by identifying high-potential healthcare technology startups that address very real industry hangups.
  • wayra is Telefonica’s accelerator, part of Telefonica Open Future platform, comprised of a set of investment vehicles and entrepreneurial initiatives.

Crowd-Investing Platforms:

  • Seedrs is one of the leading equity crowdfunding platforms in the UK having raised £1.4 Million for 27 crowdfunded campaigns in their first year.
  • Crowdcube enables anyone to invest alongside professional investors in start-ups, early stage and growth businesses through equity, debt and investment fund options.
  • Funding Circle is one of the UK’s largest peer-to-peer lending platforms.

Angel Investors:

  • Angels Den is an established angel network and integrated crowdfunding platform with a UK and international network of Regional Managers.
  • Cambridge Capital Group is a leading business angel group of over seventy members – business angels, seed funds, family investment vehicles and corporate investors – who have been investing in hi-tech businesses for more than a decade.
  • Envestors, which is authorised and regulated by the Financial Services Authority, is a network of 700+ private individuals looking to invest up to £10 Mio. in high-growth businesses, usually under the EIS.
  • Origin Capital has a technology focus, for example high-value manufacturing, life sciences, software and IT infrastructure.
  • Startup Funding Club is a network of 100+ high net worth investors connected principally through the London private members club scene. They also run early stage investment fund investing purely in SEIS qualified companies.

Also make sure to check StartUs.cc to find more links to the accelerators and incubators in London.

Want to grow big and fast? If your startup is good enough for that there are a few places where you can apply for a bigger chunk of capital.

Venture Capital Investors:

  • Atlas Venture have closed a $200 Mio. of a new fund which they are planning to invest in tech and life science sectors. Moreover, they are in the process of crowdsourcing a new name for their company and have launched a small competition around this topic.
  • Balderton Capital claims to manage around $2.3 Bio. in committed venture capital coming from investors all around Europe. They focus on funding startups from the e-commerce, consumer internet and software branche.
  • Earlybird is a venture capital fund, investing in startups from tech and health-tech sectors in different stages of their development. The average size of initial investment is around $2.5 Mio., with $250.000 being the smallest amount and $10 Mio. the biggest.
  • Episode 1 invest between £0.25M to £1M UK focusing on software startups and accompany the startup till its global growth
  • Forward Partners invest in e-commerce projects/startups. Interestingly enough, they not only invest but also support the startup in talent search. Of course, office space also included.
  • Index Ventures have managed to create an international network of venture capital companies in 20 countries. They invest in startups coming from sectors such as e-commerce, marketplaces, cloud and big data.
  • Mercia Fund is a technology investor have recently raised a £70m fund. They provide startups with the early stage, development and growth capital.
  • Notion Capital is a venture capital fund investing in B2B companies from sectors of Cloud delivery & SaaS. Provide seed and series A investment for startups from all over Europe.
  • Passion Capital is an early stage venture capital firm investing in digital media and tech startups. When they launched in 2011, they started with initial $60 Mio. funding, $40 Mio. of which came from the government.
  • Playfair Capital invest in tech startups whereas the team might be even more valued than the idea. They place premium on teams with technical backgrounds.

London is a very dynamic city, especially when it comes to new business developments and startups. Make sure to keep your eye on new funding opportunities emerging. Go to events mentioned above, talk to people and check out pages where the community hangs out online. And remember that nobody cancelled “bootstrapping” as an independent strategy.

Find Mentors In London

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Facebook groups are the go-to for newcomers to the startup scene in London. The good thing about them is you can join them at any time even if you have not yet moved here and you can stay in touch with what’s happening in the community when you are away.
The various Facebook groups were started by veteran of the scene (Mike Butcher, Elizabeth Varley, Dan Quine, etc) and as such are trusted resources when it comes to represent the community or simply when asking for help.

The few groups you should join:

Physical Places

There are gazillion coworking spaces, incubators and cafes where startupers gather. It would be naive, insane and erroneous to pretend to be able to list them all and/or just the best. As such, I will point at places that have for the last years made significant contribution to the development of the startup scene.

For the rest, if you want to go to the next cool cafe where entrepreneurs meet or the edgy new coworking space in gentrified hackney, I would suggest you ask the community on Facebook and listen to the word at the counter of the corner trendy coffee shop.

The “Startup Church”

Google Campus was inaugurated in 2012 and became an instant success. The brand name and noise in the press after the launch event helped, but it would be demeaning to just make this the definitive factor of its popularity. Google campus in its physical design execution, day-to-day operations and its pricing model is simply the most advanced kind of place to feed and nurture an open tech community so far. You should go to taste the waters and get a feeling for how the community connects and interacts. However, keep in mind that it only represents a fraction of tech entrepreneurs & startups based in the East. It is the least white-geek place thanks to Google Campus successive Directors, Eze Vidra & Sarah Drinkwater who have always put diversity at the heart of community events at Google.

Google Campus provides the most affordable place to work, network and create events which is the reason why it has become and stayed the central place for the community to meet.

The Migrant Bar

Go to the Silicon Drinkabout, the weekly drink meet-up for startups and techies happening every Friday signaling the end of the working week. This is where you will be able to distinguish the various group of tech people and pick the like minded individuals you feel belonging to. It is the largest meetup for start-uppers found in the East. It bridges a great British Institution – the pub – with tech.

The Fleeting Meetup Cafes

I would suggest to join meetups and specific groups that represent your specific interests in Tech. The East London startup scene has become somewhat overcrowded, and you risk finding yourself with people that, like you, just happened to have arrived in London and have the same questions you have – but no answer to them. Stay away from events with “startup” in the title and you will keep away from low quality networking if you want my direct and honest opinion.

Instead get involved in more niche and expert groups to meet people that have been here for a while. You can do this by:

  • exploring out a little further away from Shoreditch in places like Innovation Warehouse, Adam’s Private Club, SecondHome and some other small clubs in Soho (Wework, Trouble, Central Working – these are smaller less crowded spaces and investors offices are often around the corner (Mayfair).
  • explore your diaspora groups. I will take an example. There are lots of frenchies in London and they often help each other to accommodate newcomers in via a Facebook group. I am pretty sure there is a Facebook startup group for your nationality.
  • asking to be introduced. The UK has a tradition of clubs. It is very much felt in the way introductions are real plus to any networking activities you are involved in. Ask for introduction from friends and people that have been here for a while. London has become so big with start-uppers and entrepreneurs, that to get good quality networking, introductions and recommendation are key.

Finally, you can find a lot of information on tax rebates, resources of the Government and deals for startups on TechCityUK website, stay up to the beat of what’s new on Tech City news, connect people with accelerators, funds & investors on f6s.com and get your visa papers sorted with the migreat app.

So – are you ready for London?

 

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Co-author: Josephine Goube

Last updated: July 29th, 2016

The guides are like startup communities – they contstantly change and grow. Make sure to check for updates and if you have something to add to one of them or want to publish one for your city, get in touch right away! And don’t forget to enrich the startup ecosystem by creating your company profile at StartUs!

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