TechNation loss of ￡12 million startup ecosystem to Barclays, confirmed

It's been a sad week for the tech community as UK Government confirmed the diversion of ￡12 million worth of structural startup incubation funding from TechNation to Barclays Eagle Labs. When first announced earlier last year, it drew surprise and disappointment for much of the tech community, with many people across the UK voicing their support.

As someone who's sought support from TechNation and invariably had none, as with many ethnic minority founders, at that time of the announcement, I wasn't so supportive. While it is sad to see an organisation with handfuls of friendly people at risk of collapse, the reality is TechNation was never set up to deliver an equitable experience. On issues of race, which is by far the least equitable part of funding and support in the UK ecosystem, it was a catastrophic failure!?

• The programmes failed to deliver balanced equality across the regions?
• It developed cliques which, if you didn’t fit within it, you were gatekept out
• It failed to rebalance the relationship between ethnic minority founders and the UK startup ecosystem. A topic it has consistently failed to address or even engage with

The lack of engagement on these topics isn’t harmless, it adds a gatekept position that propagates further the disparities between disadvantaged groups. With so much at risk when founders start, it increases disadvantage as the 'haves' accelerate away and the 'have nots' left behind. Increasing poverty gaps in two directions. One by gentrifying areas [with one shade] and the other by acting as a barrier to social mobility [of every other shade].

For disadvantaged groups in particular, a need so great and support so useless, Black founders have a 6 times higher chance of funding going to the USA for support than remaining in the UK. TechNation has done little to close this gap but has done plenty to hide it and cause more generational harm. In all its time, it refused to properly engage on this topic, pretending instead that it doesn't exist and it s nothing to do with them. While it takes pride in stating that it's female founders make up 30% of its cohort, it remained conspicuously silence on other intersectional traits, before and after the murder of George Floyd. Its ecosystem taken by surprise by both his murder and Brexit. A clear sign by anybody who's dealt with the public service, of a deliberate removal of context. To “concentrate on the positives” and “Demonstrate our achievements” [or we’ll lose our funding]. In doing so, hanging everyone else out to dry.

Background

TechNation Started life as two separate organisations. TechCity UK and TechNorth. Merging in 2017, this combines ecosystem was meant to achieve cross pollination of ideas, skills and even reduction in operating costs. Yet, the net effect was to propagate a London-centric financial gravity. Maintaining funding gaps between the capital and the regions that existed before it’s creation.

The organisation was supported by an ecosystem of independent media, which itself acted as gatekeepers and biasing results towards London. Contributing to greater financial disparity. Forcing many organisations founded in the North to move sales and investment outreach, together with operations, to London. A diametrically opposite effect to the principles underpinning TechNation’s existence at a time when established companies were moving their operational teams North. Demonstrating a complete lack of awareness and exploding that disparity.?

Nothing demonstrated this more than TechCity’s article in 2015 stating 74% of digital companies exist outside London, but the vast majority of TechNation support has gone to London companies. Showing the catastrophic level of dangerous incompetence that went along with the organisation.

Instead of tackling that disparity, the organisation focused on a host of irrelevant or competing activities. Its visa schemes encourages the best and brightest from abroad into the UK, but mostly the London ecosystem. An important and noble step in enabling areas to gain the skills they needed but the net effect lost focus on the disparity between different parts of the UK and holding opportunity in the South, as most of the scheme’s alumni stayed or moved there.

As someone acutely aware of these disparities, and has worked with organisations trying to close them, TechNation remained the blocker to delivery of the end of the pipeline for higher education and apprenticeships throughout its existence as a merged organisation. On many occasions, even critical commentary about it, it's sought to bury, to hide its incompetence, to exclude communities, through its network of insidious, cronyistic support.

The Now

There has been much disdain thrown at Barclays and Eagle Labs and they're not exactly Green Tech’s favourites either, given their support for fossil fuel industries. It’s principles work against the ethos and fabric of tech companies in this space. Yet, They have the necessary networks and have been delivering parallel start-up resources to TechNation for some time. Despite not fully covering the difference, they already have the ecosystem around them and access to start-ups to support, that TechNation chose to throw in the pit by competence or design. Indeed, that has been where many under-represented founders have had to go. Barclays also has the fund backing to make it happen in ways TechNation hasn’t. They waited patiently, at their own expense, almost shutting up shop completely, but it turns out, like a phoenix from the flames, Eagle Labs is back. But at what cost??

The Future

I've talked before about how ecosystems elsewhere in Europe do things. Germany’s state owned Deutche Bank, makes funding extremely accessible and uses more sophisticated DRIP funding models to engage founders on relatively low risk assets and interest rates. Balancing investor confidence and equity needs to deliver 21st century funding. The trade-off is you have to base in Germany and the funding doesn’t come at you all at once. TechNation itself, offered no funding and it turns out, for what they saw as the “wrong” type of founder, in the wrong place, no support or even access.?

While the cliques will sing its praises, those it left behind will not be sad to see it go. Even through TechNation's own data, they failed to meet the objectives of equity. Failed so hard that it is likely a bank, like Barclays, who have been accused by some of supporting modern apartheid and may well be completely the wrong organisation for 21st century equitable economies, who've may do it better than TechNation. At a time when the cost of living crisis is biting many and disadvantaging inequitably, many founders would jump at the chance offered. Especially if it means they don't need to move anywhere.

Barclays is not as well connected with the tech community and isn’t “in with the” cliques as well either, which might work in favour of diversity and against the cultural cliques that act as a barrier to diverse equity and encourage more diverse people and nurture them with greater hope. Something Eagle Labs already have.?

Only time will tell ultimately. For me and other founders with ethnic heritage and based outside London, all it would have needed was for tech nation and its ecosystem to stop one day and ask themselves AITA? That lack of self-reflection and the entirely expected failure to meet its objectives, comes as no surprise socially and economically. There may be TUPE concerns and sadly, that may mean the bank might see the same soft-destructive forces maintain their positions in the ecosystem in some other form. Until the forces of “job dilution” take hold and they become redundant.?

Still, for the under-represented outside TechNation in the cold, it’ll feel like good riddance to bad rubbish!