April 5, 2016
High-speed internet connections and mobile technology have made it cheaper and easier to start up a technology company.
As a result, more tech start-ups have been created – especially in the North East, where there is the added benefit of low cost of living – but many of these fail because their creators lack the required business acumen.
To combat this failure rate, accelerator and incubator programmes (models which first started in the US) have become more common in the UK. These initiatives provide early-stage businesses with small amounts of investment along with business and technical support.
In the North East, the first accelerator was the One North East-funded Difference Engine which ran from 2009 to 2011 before its public investment faltered.
Paul Smith, a business entrepreneur from the North East who had previously co-founded a tech start-up and a design agency, decided to fill the void by creating a tech-focused accelerator programme that would be privately funded through angel investors and venture capitalists.
He partnered with Jon Bradford and Colin Willis, as well as Lyndsey Britton – a former fashion buyer who had previously worked on in an
incubator space – and Ignite was formed in 2011. Tristan Watson, the current managing director and former technology entrepreneur, joined the company full time in 2013.
Over the past five years, around 75 business have gone through the Ignite programme, including successful ecommerce developer Moltin and promising music streaming company Leaf.fm, which moved from Costa Rica to the North East to take part in the programme in 2013.
Each start-up – usually comprising two or three people – is given £17,000 of privately sourced funding and, in return, Ignite receives a small equity share of the company.
Participants also take part in a 14-week programme of intensive training in accounting, marketing, business management and investment raising from experienced entrepreneurs and sector experts who volunteer their time.
Tristan explains: “First, we pull the companies’ ideas apart, even if they are already making money. Sometimes the ideas change completely but a good team will manage that transition.”
As Ignite became established, the team recognised the need for a not-for-profit operated co-working space for alumni of the programme as well as other small-scale creative and digital companies and freelancers that could share ideas and collaborate.
They created a space on Westgate Road in Newcastle but the concept proved so popular that the search for a larger location began.
Paul, Lyndsey and Tristan finally found what they we looking for at Sunco House on Carliol Square in Newcastle and – thanks to a band of volunteers and a successful Kickstarter campaign – Campus North opened in 2014, offering hot-desking, co-working and private offices, as well communal meeting rooms and learning spaces.
Lyndsey explains: “We offer an important network and community for our residents, as well as business support through a series of workshops and our events.”
A growing events programme and the demand for a location where the region’s digital groups could meet led to Campus North opening the neighbouring Bunker Coffee and Kitchen and a 2500 sq ft events space in 2015.
Lyndsey reflects: “As the tech scene has grown in Newcastle, it’s become a bit fragmented. There are a lot of networks in the region and Campus North’s facilities are helping to pull them back together and have one focus.”
Ignite continues to hold around three accelerator programmes a year, with space for ten enterprises in each.
Every programme receives around 400 applications from around the world – including from the North East – which are whittled down through a series of interviews and workshops.
Companies of the Ignite programme raise, on average, £250k of extra investment once they graduate and last year’s alumni raised an impressive £11 million between them.
Many companies – including Moltin and Leaf.fm – also choose to continue to operate from the North East, either at Campus North or by creating their own working space in the area. This helps to create jobs and further strengthens the region’s burgeoning tech scene.
While Campus North will continue to supply a vibrant and flexible co-working space for some of the most inventive and creative companies that choose to base themselves in the North East, Ignite is looking to expand its reach further afield.
It recently launched programmes in Manchester and London and is looking to engage more with universities and expand its series of pre-programme events for those not yet at the stage of applying for the accelerator programme.
This development, however, will be without the day-to-day involvement of Paul Smith, who publicly announced in January that he would be leaving his CEO role.
Tristan reveals: “Paul spoke to the team about 12 months ago about leaving and will step down at the end of April – but he will remain as an advisor.
“Paul’s decision will change who is around on a daily basis but not the dynamic of Ignite and Campus North.
“I think it’s incredible what the company has achieved since 2011 and we have a great platform to build on this and move forward.”