Eric van der Kleij: No 10 guru set to super charge UK's Tech City
The Business Interview: Entrepreneur is sure that London will soon rival other global cyber centres
Nick Clark is the arts correspondent of The Independent. He joined the newspaper in June 2007, initially reporting on the stock markets. He has covered beats including the City, and technology, media and telecoms and made the switch to arts in December 2011. He has also contributed articles to the sports section.
Thursday 08 September 2011
David Cameron outlined his vision to make east London "one of the world's great technology centres" with the launch of Tech City UK in November. Silicon Valley remains the benchmark, he said but "there's no reason why it has to be so predominant".
The man entrusted with delivering the Government's vision for a thriving technology industry based in London is entrepreneur Eric van der Kleij. The chief executive of the Tech City Investment Organisation is confident that Silicon Roundabout," as it has been dubbed by locals and which stretches from Shoreditch to Stratford, can be one of the top three global centres for technology start-ups.
Mr van der Kleij said: "David Cameron's speech in November accelerated what had already started in the Shoreditch area. What the Prime Minister did was give a clear vision for the future of the area. The surrounding boroughs will see the benefit as well."
Three years ago there were 15 technology start-ups in the area including notable success stories Songkick, Moo, Tweetdeck and Last.fm. In November there were over 100 and since the arrival of Tech City UK that has grown to over 500.
Mr van der Kleij said: "That makes it the fastest-growing tech cluster in Europe, and without the Government writing huge cheques. Some ask why they should set up there. I say the cluster is where your business is most likely to succeed. Your partners clients, investors will be there. You'll be able to hire people. You'll come up with great ideas."
Mr van der Kleij drew up the Government's master plan for Silicon Roundabout after UK Trade & Investment (UKTI) approached him to advise on how to attract more investment to the area. "That is what I had been doing for all of my working life. So I wrote a few papers and presented the ideas. These evolved into the strategy for Tech City."
Tech City Investment Organisation now has a direct team of 14 in the UK and North America with a mix of UKTI professionals and technology sector specialists including former European managing director of LinkedIn Kevin Eyres. While his official base is in the UKTI's Victoria Street offices, Mr van der Kleij operates "somewhere in Tech City every day" at the various start-up incubators dotted across the area.
The role includes encouraging entrepreneurs to set up in east London, to support them, attract investment into the UK and to encourage people to buy products and services that emerge. He is also in talks with international IT groups to establish a presence. "There is a lot of land in the corridor from Shoreditch to the Olympic park. It will become a natural magnet for larger companies," Mr van der Kleij said. Companies including Cisco and Intel have already committed.
Mr van der Kleij said the area's heritage made it the perfect place to launch Tech City. "It has always been the cultural sponge of London from when the Thames Clippers used to sail up the Thames carrying tea," Mr van der Kleij said. He backed its success as a "lower-cost area of London, and an area that has been ready to accept new ideas".
He said the arrival of artists such as Damien Hirst was important to the regeneration of east London.
"The creative classes were attracted and this has now developed and expanded to the creative and digital agencies". The addition of the investment into the Olympic site has only made the area more attractive. "It is an amazing opportunity to have this infrastructure; there have been a lot of expressions of interest over legacy uses of the site."
The development of a thriving tech industry is crucial to the UK's future, Mr van der Kleij said. He added: "I've always been a believer in a tech scene, even during the hard times, for the same reason that venture capitalists like it. It's a low capital-intensive scene. For a small amount of money compared with manufacturing you can get economies of scale."
While the Government has not provided huge financial support – there is a £1m fund to support small digital businesses – Mr van der Kleij points to three policy changes that have boosted the area.
"The Entrepreneurs Visa was an absolutely brilliant piece of work, the US community is quite envious," he said. "Moving tax relief from 20 to 30 per cent was big for investors and sent out a clear signal that this is a fundamental part of the UK's future. We need that early stage rocket fuel." He also backed Patent Box. The UK Government is currently consulting on creating a "preferential regime for profits arising from patents".
His own interest in technology was sparked by his brother, who gave him a Sinclair ZX81 when he was a teenager "and I realised you could control the universe. It was an inspiration". Mr van der Kleij, who is of Dutch origin, grew up in South Africa before settling in the UK at the age of 15. "The UK has been an amazing place for me to grow up in and develop a business." While he did not "have the aptitude for formal programming, I realised if you made a programme you could sell it to a thousand people. So I studied business." His early career involved commissioning software for golf clubs to manage their memberships.
This changed when he started a web call-back service in 1996 after a frustrated attempt to buy his wife flowers online. The product failed to gain traction but out of it came his big success. "In the traditional way of iterating and pivoting, we changed direction and used the platform to help alert credit-card fraud," he said. Adeptra was born. After raising £30m in venture-capital funding, he took the company international. "That journey and experience was what qualifies me to do what I do today," he said.
He left the business in 2006 and was approached by the Government to help establish its Global Entrepreneur Programme, which helps early stage technology companies from around the world set up in the UK. Since 2004, it has launched nearly 150 projects.
Mr van der Kleij's role is described as "entrepreneur in residence" yet he has found life as a civil servant has some challenges. "For some I have become the enemy. It doesn't worry me, but it is a surprise. Half of the tech community accept the entrepreneur side, the other half see me as government."
Yet this has not put him off from what he sees as a hugely important opportunity. "With Tech City UK this is a moment in time. We probably won't get another chance like this so I'm putting everything into this."
Eric van der Kleij CV
Married with three children
Dutch national, grew up in South Africa before moving to the UK at the age of 15
Interests "Discovering interesting music using various new technology platforms, most recently Flamenco house music"
1996 Set up RealCall with co-founder Martyn Walker
2000 Overhauled the business to create Adeptra
2006 Left Adeptra, became an adviser to UKTI, created the Global Entrepreneurs Programme
2010 Chief adviser, Directorate for Investment
2011 Chief executive of Tech City Investment Organisation
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