Interview: Russ Shaw, founder, Tech London Advocates

Tech London Advocates is a network of more than 500 people in the technology ecosystem who link up to promote London’s emerging tech sector by dealing with issues and challenges they see on the horizon

Tech London Advocates (TLA) is a network of more than 500 people in the technology ecosystem who link up to promote London’s emerging tech sector by dealing with issues and challenges they see on the horizon.

The group was launched last April by Russ Shaw, who spends his time growing the network and encouraging its members to be “on message” and use consistent information about the technology sector.

Shaw explains: “The idea came several months before that, when I was invited to join the Tech City Advisory Group [now known as Tech City UK], and I was sitting in some of those meetings and seeing what the Greater London Authority was doing and thinking: ‘Wow, our government is doing great things to promote technology.’

“But I didn’t really see anybody coming together to say: ‘This is a group to represent the broad tech ecosystem.’ So that was the idea.”

Advocates range from startups to large corporates, including the CEOs of Talk Talk, BT and Barclays, as well as angel investors, venture capitalists, private equities and headhunters.

Shaw says the network is more skewed toward startups, entrepreneurs and angels, but he is on a mission to bring more corporates into the group, even though TLA also has Amazon, Cisco, IBM and Morgan Stanley on its books.

“We’re starting to bring more of the bigger guys in,” he says. “They’re really helping us in terms of how do you bring big and small together.”

Tech City and UK clusters

Shaw says he is a big fan of what the government is trying to do with Tech City in east London.

“I’m a private-sector person through and through, but how government can be an enabler can only be a positive,” he says.

We have a great momentum here with the tech sector in London and it's now starting to happen across the UK

One of the 500 advocates Shaw has rallied together is the current CEO of Tech City UK, Gerard Grech. Shaw says Grech’s  agenda is no longer focused on London, but how Tech City can help the rest of the UK’s startup communities.This is illustrated by Tech City’s rebranding last year from the Tech City Investment Organisation to Tech City UK.

TLA also began as an organisation promoting the London brand, but Shaw is now looking at how he can work with Tech City on a national scale.

“London is a global brand,” he says. “We have a great momentum here with the tech sector in London and it’s now starting to happen across the UK.”

But Shaw points out that London is “the only truly global city”. He sees the capital becoming world leader in financial services technology (fintech) and advertising technology (adtech), as well as health technology in the coming years, and technology involving analytics, security and cyber security.

“A lot of folks in Silicon Valley don’t necessarily know other areas [of the UK],” he says. “When they hear ‘Birmingham’, they hear ‘Birmingham Alabama’, but they know where London is.

But there’s no reason why you can’t connect to other parts of the UK.”

Shaw already sees great potential across the rest of the UK beyond the traditional tech clusters of Oxford and Cambridge.

We’re becoming a country of entrepreneurs. But we need to collaborate with other cities

“There’s Brighton, Portsmouth and Bournemouth on the south coast,” he says. “And Manchester, Bristol, and the international festival for business is happening in Liverpool this summer.

“Edinburgh has a mini tech sector, too. So there are pockets of innovation everywhere.”

Shaw says he is seeing people becoming tired of working for companies such as American Express in Brighton or IBM in Portsmouth, and they are leaving to start up businesses of their own. “And, as people are starting, you have these little clusters – some of whom come from corporate and others who are just naturally entrepreneurial – that aggregate together,” he says.

“We’re becoming a country of entrepreneurs. But we need to collaborate with other cities, because the tech sector is so enormous.”

Silicon Valley and advice

Shaw points out that the UK is not trying to copy Silicon Valley in the US, nor should it.

“Here, we have a very different heritage, a very different DNA, and Silicon Valley has been at it for 25 years,” he says.

But Shaw says the UK should not be ashamed to borrow some of the practices from our American cousins. Silicon Valley has networking engrained into its culture. Shaw says a 30-minute pitch to a company or investor would often result in a “no thanks”, but after that, the organisation will frequently offer its knowledge to the startup, recommending it to connect with someone else.

“That’s how the valley works – they all help each other, and they all benefit from helping each other,” says Shaw.

And that is where the TLA’s ecosystem comes into play in the UK, he adds. “Let’s help everyone for the greater good.”

If anyone signs on to become an advocate, Shaw asks only one thing of them: “If a fellow advocate asks to be connected to someone, your response should be yes; or if you can’t help, direct them to someone who can. That’s all that is required.”

On top of this minimum networking requirement, if the advocate has more time to give, there are working groups they can get involved with.

There are currently 12 working groups focusing on all kinds of issues, from women in tech to immigration. The latter group is currently working with the Home Office to ease the blockades most startups face when hiring staff from outside the UK.

Out of the 500 advocates, 200-300 are linked to at least one working group, and 100 advocates have volunteered for a new triage programme.

Shaw this is a bit like hospital triage, with startups able to come to a desk in Tech Hub and ask questions ranging from where to get finance to help with marketing. Through triage, they will be matched to an advocate with relevant knowledge and expertise.

“Let’s not just be the mouthpiece, let’s get stuff done,” says Shaw.

The TLA programme is free for advocates and was funded solely by Shaw last year. He is currently an angel and venture investor, as well as being a non-executive director in a number of high-growth businesses, including Dialog, a publicly traded semiconductor company, AIM-listed Cupid and Unwire, a Danish, venture-backed mobile commerce business.

The mobile wallet

One area of technology Shaw gets frustrated about is the mobile wallet and payments. He would like to see more happen quickly, but he says the mobile ecosystem is much more fragmented than desktop.

“The challenge with mobile is that everybody wants a slice of the value chain,” he says.

Banks and telcos all see potential in the industry, but because of its fragmentation, Shaw does not see the mass adoption that is needed for it to go mainstream.

He thinks joint ventures may be the answer, pointing to Denmark, where a digital wallet platform between the banks and telcos has been agreed because both “give in”.But he says progress in the UK is “slow and painful".

Shaw's career has seen him involved in the telecoms/VoIP space. He was vice-president and general manager at Skype before it was bought by Microsoft, and before that he was global innovation director at Telefonica, after working on Telefonica 02’s mobile business as marketing director. “It’s part of my give-back,” he says. “The tech sector has treated me really well over the years, but it’s getting so big now that I’m asking advocates from companies and corporations to help.”

Shaw is currently in the middle of a funding drive to cover the two events TLA organises each year and to upgrade its website. The City of London Corporation has become a 2014 sponsor partner, but Shaw does not want to raise a lot of money.

“I don’t want to lose sight of the fact that it is a network of people and individuals and a connection of people that’s being built," he says. "It’s not about the funding, it’s about the connections.”

Problems for a startup

Shaw says one of the areas that can cause trouble for startup companies is management as they become larger and more mature. Tech City is full of techy, bright-minded people with a great idea for a business, who call themselves CEOs, but as companies get bigger, Shaw doesn’t always think the CEOs should remain in their role.

“A lot of people who start these companies are ideas people – they can not necessarily run a business of 100-200 people,” he says. “So you have to labour a transition early. Sometimes it works and sometimes it doesn’t."

He says companies reach a vulnerable point in their history when they change C-level executives, because many employees who come in under that CTO, for instance, may see a culture change further down the line.

At Skype, Shaw worked for four different bosses in the two and a half years he was there. “How can you bring culture and continuity to your people if you have different bosses?” he says.

Part of our challenge is that our tech investor community is not as sophisticated as it could be

He also believes that when the UK begins to see a steady stream of startups going from early to late stage and then exiting on the stock market, that is when the country will become a “truly world-leading technology centre” that will attract a lot more funding from outside.

Shaw thinks anything above £100m is a good price for a company to exit the UK tech scene. Google's purchase of UK startup Deep Mind was rumoured to have been around $400m, and Natural Motion's purchase by gaming company Zynga for $527m.

“Part of our challenge is that our tech investor community is not as sophisticated as it could be,” he says. “That is entirely understandable. The US has been at it for decades and the tech investor there is very willing to invest for the longer term.”

In the UK, Shaw sees startups being put under pressure to turn a profit in three years, but he thinks this is too soon.

Another good sign of a prospering technology economy, in Shaw’s mind, is startups buying other startups. He points to Wonga, which bought a German payments company called BillPay last summer, and Unruly Media, which bought the social ad platform Shareifyoulike, also last year.

“Startups buying startups is a sign of maturity," he says. "It shows they are trying to build scale as they move towards their exit.”

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