End of an era for London’s start-up scene as Google Campus closes

Boris Johnson at Google Campus in 2014

Credit: Geoff Caddick/PA Wire

For young founders trying to launch their latest start-up, the basement cafe at Google’s Campus in Shoreditch was the place to be seen. 

Just five years ago, it was a hub of activity, with plywood benches always full and conversations often animated. 

Job adverts for developers would be scrawled on pieces of paper and pinned to a noticeboard. High profile visitors, including the heir to the Swedish throne, often posed for photos inside the building.

“It was such an egalitarian concept,” says Nick Levine, a financial technology consultant. “Anyone could go down to that coffee shop. You didn’t even have to buy coffee, it was a novelty to buy something.”

“It felt like you could very quickly start off as an observer and quite quickly ingratiate yourself within that ecosystem.”

Levine was just one of many technology employees who used Campus’ work spaces after it was launched in 2012 by George Osborne. 

The seven-storey building sat in the heart of London’s so-called Silicon Roundabout on Old Street with desks going for up to £450 per month. 

The area was hailed as Tech City by former prime minister David Cameron and was the epicentre of the country’s fast growing digital economy as low rents and easy access to the financiers in the City of London drew firms.

But its days of producing the next tech star are over. On Monday, Google announced that its Campus has been scrapped as its 10-year lease comes to a close. Instead, it said it would be moving its start-up support programs and services online.

“The UK start-up community doesn’t need access to a single-shared physical space as much as it needs access to resources, mentors, and programs available at scale, anywhere,” Google said. “And so as the ecosystem develops, so does our approach.”

Its comes as businesses assess the need to spend hundreds of pounds per employee for desk space inside so-called co-working offices. Covid restrictions have also dampened appetite for in-person networking events, which were once such a crucial part of the East London tech scene.

“When Campus was started there were maybe three tech events worth attending and they all had the word ‘drink’ in their title,” says Eze Vidra, who ran the incubator from its launch until 2014.

“I think it played its purpose,” he says. “The offering changed. The fact that it’s no longer needed is a good thing because it’s happening everywhere.”

Not everyone was a fan of Silicon Roundabout and Google’s focus on East London. “I’ve never heard of anything as ridiculous in my life as branding the flagship of UK tech after a traffic symbol,” David Richards, the chief executive of British software business WANdisco.

It had it share of successes. In the early days of its launch, a young composer named Ed Newton-Rex would often sit alone, building software that used artificial intelligence (AI) to create music. ByteDance, the Chinese owner of TikTok, eventually hired him and his employees to start the company’s AI lab in London.

For every successful exit that came from Campus, many other start-ups ran out of funding or sold up for knockdown prices. Ticket sales start-up YPlan, for instance, was a high-profile early resident and raised £27m in funding. The business struggled to grow and was sold to Time Out for £1.6m in 2016.

George Osborne, then chancellor, opening Google Campus in 2012

Credit: Chris Ratcliffe/Bloomberg

Campus became a cornerstone of Google’s extensive lobbying in the UK and across the EU. The building was a concrete symbol that the technology giant was playing nice with smaller companies – a useful card to play as European Union regulators began increasing their scrutiny of its operations from 2012.

For Richards, who runs his software company from Sheffield, Google’s control of Campus reduced its usefulness. “All it really was was we’ll give you a space to work and we’re going to promote Google technology up the wazoo.”

As the UK’s technology start-up scene matured and broadened beyond London, the need for a concentrated central hub in East London faded.

Tech City, the Government-funded organisation set up to promote London’s start-ups, rebranded itself to Tech Nation in 2017 as it embraced other parts of the UK.

Rohan Silva, the former No 10 advisor who persuaded Google’s then chairman Eric Schmidt to abandon his initial plan to buy the Olympic Park and to instead invest in building Campus, has since launched his own co-working business Second Home.

Started in a former carpet factory to the east of Campus, Second Home quickly expanded beyond East London and Silva now lives in Los Angeles running its newest office there.

But even before the pandemic hit, these in-person networking hubs faced difficulties. Second Home’s valuation was reduced in 2019 as costs overran for its Los Angeles location.

Campus, meanwhile, struggled to find its own place in a mature technology sector in London at a time when new start-ups could find co-working spaces across the country.

“I remember going back a couple of years ago and it just felt dead,” Levine says. “It’s felt dead for years.”

The rise of virtual networking during lockdown has proved fatal for many businesses which rely on start-ups paying tens of thousands of pounds per month for desk space and in-house networking.

Desk rental business TechHub, which occupied two floors of Campus, shut down its UK operations last year after running out of money. Revenues had dropped 75pc, its chief executive said.

Richards says Campus relied on an already “outdated” idea that technology events had to happen in-person and in London. Despite this, many leading names in the sector insist that in-person office buildings and events will have a future.

“I’m in Israel which really feels like it’s post-Covid,” Vidra says. “Having seen a post-Covid environment, I don’t think the offices are going away.”

Technology offices are unlikely to vanish entirely, but Campus won’t be opening its doors again even after pandemic restrictions ease. 

For those who ran the building or started companies there, its closure is a bittersweet milestone.

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