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From Silicon Roundabout to Silicon Valley: Barclays Capitalises as Tech Nation Closes

Government-backed incubator for UK-based tech companies, Tech Nation, has announced plans to permanently close after serving the industry for over a decade.

Tech Nation served the UK startup and scaleup technology ecosystem; offering a range of growth and expansion programmes, digital academies, conferences and more. The organisation announced that it will close its doors for good after 31 March 2023; following its government’s Digital Growth Grant being pulled in favour of Barclays Bank‘s own incubator: Barclays Eagle Labs.

Tech Nation released a statement addressing its closure on its website, explaining it has “exhaustively explored whether Tech Nation could continue without core government grant funding, but have concluded after extensive consultation that this is not an option”.

Paul Scully
Paul Scully, Minister for Tech and the Digital Economy

Paul Scully, Minister for Tech and the Digital Economy, explained the decision to pick Barclays’ incubator: “We want to unlock the potential of the next generation of startups and scale-ups and boost tech businesses in all corners of the country.

Barclays Eagle Labs are digital industry experts and will help tens of thousands of tech firms and founders to achieve their dreams and create jobs and economic growth.”

Tech Nation plans to continue to operate until funding from the Department for Digital, Culture, Media and Sport (DCMS) ends in March 2023. The grant to Barclays Eagle Labs runs from April 2023 to March 2025.

Making the UK the ‘world’s next Silicon Valley’

The decision to redirect the grant to Barclays’ initiative, may be part of new government plans to make the country the “world’s next Silicon Valley”. The current Chancellor of the Exchequer, Jeremy Hunt, delivered a speech to several high-level executives from major fintech and tech companies on Friday 27 January, in which he stressed this aim.

Perhaps ironically, Hunt praised Tech Nation alumni Monzo and Revolut as “shining examples from our world-beating fintech sector” in his speech to leaders from Monzo, Revolut, Amazon, Meta, Microsoft, Apple, Google and more.

Hunt called upon the major fintech and tech companies to “help turn the UK into the world’s next Silicon Valley”, and explained that “Britain is vital” for their future.

Ekaterina Almasque, general partner at OpenOcean
Ekaterina Almasque, general partner at OpenOcean

Ekaterina Almasque, general partner at early-stage venture capital firm OpenOcean, explains why branding moves as ‘silicon’ is not enough: “If the UK government wishes to turn the UK into a new Silicon Valley, the industry needs grassroots support.

“Deep tech firms in fields like quantum technology, for example, have timelines measured in decades and rely on targeted incentives and funding from the government to ensure continued progress is made. Many countries around the world are making these efforts to back their tech economy. The UK must do the same if it is to avoid falling behind its peers.

“Simply branding plans with ‘Silicon’ is not sufficient. We must ensure that we put in place the correct processes to bring talented founders with innovative software ideas all the way from ideas on a whiteboard to stock listings in Piccadilly Square.”

Barclays London Tech Nation Barclays

Selecting Barclays Eagle Labs 

The DCMS grant went to Barclays Eagle Labs, aiming to support small and scaling tech businesses throughout the UK.

Eagle Labs logo Tech Nation BarclaysThe Digital Growth grant, worth £12.09million, looks to build on the £42.2million invested by the government to support tech start-ups and scale-ups since 2016.

As many industry voices display concern over the decision to elect Barclays Bank to champion the UK tech industry, the government aimed to ease concerns by reiterating that “Eagle Labs is operationally independent of Barclays’ banking services”. It also explained that monitoring processes are in place to ensure funding is used for its intended purpose.

Amanda Allan, director of Barclays Eagle Labs, commented on the initiative’s aims after obtaining the grant: “Eagle Labs’ vision is to make the UK tech sector an engine for growth and for the UK to be the best place in the world to start and grow a tech business

“Through the Digital Growth grant, we’re excited to double down to reach more businesses across the country with our best-in-class business growth programmes and bespoke regional support.

“We have a track record of supporting over 8,000 start-ups and high-growth businesses since we launched in 2015 and we’re proud that, due to our established Eagle Labs network, we can pass through all grant funds to our delivery partners and programmes, helping to maximise the impact of the grant in supporting the UK tech ecosystem.”

Tech Nation will no longer administer any visa schemes that were previously under its control. Currently, Barclays Eagle Labs will also not assume responsibility for the schemes.

The Tech Nation impact

Tech Nation, set up by then Prime Minister David Cameron‘s coalition government, originally launched in 2011 as Tech City UK.

The organisation focused on fostering growth of tech companies specifically in East London, from its base in Shoreditch. The focus, specifically in and around Shoreditch’s ‘silicon roundabout’, was eventually expanded; with the foundation of Tech North, which aimed to run further programmes across the North of England.

In November 2017, Prime Minister Theresa May and Chancellor Philip Hammond initiated a merger of the two organisations to form Tech Nation.

It has overseen operations such as a growth programme for startups, alongside digital academies, networking conferences and international expansion programmes to help boost UK tech. Tech Nation also offered a visa scheme; providing access to Tier 1 visas to help attract ‘exceptional’ tech talent to the UK.

As well as growth and talent schemes, the incubator also looked to champion the UK’s digital sector via case studies, reports and outreach.

Tech Nation boasted its impact on more than 5,000 businesses since its inception, which include the likes of Monzo Bank, Revolut, Deliveroo, Depop, Just Eat, Skyscanner, Peak AI and more.

Tech Nation 2022 cross-programmes finale event
Tech Nation’s client engagement director Liz Scott hosted a panel with Philip Belamant, CEO of Zilch and Ray Chohan, CEO of PatSnap, at its 2022 cross-programmes finale event
Closing the door on a successful tech period

The government-backed organisation explained that it had delivered a £15 return on every £1 invested by the UK Government. While 80 per cent of start-ups fail within their first two to five years, Tech Nation explained that over 95 per cent of startups on Tech Nation’s growth programmes went on to scale.

Janet Coyle CBE, managing director of business at London & Partners, said: “Tech Nation has played a key role in our scale-up ecosystem over the past decade. From the early years as Tech City when the focus was on Shoreditch to the growth of a UK-wide tech ecosystem, Tech Nation has helped to amplify the UK’s strengths in tech on a global stage.

“We would like to thank the Tech Nation team for your collaboration over the years and for your focus on championing UK scale-ups.”

Tech Nation has already begun a redundancy consultation process for its staff. For staff working in DCMS delivery, the incubator has also initiated TUPE discussions with Barclays Bank.

It is unclear exactly what impact the decision could have on the UK startup and scaleup tech industry; but many hope that Barclays can continue to support its growth.


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