The time is right for Scottish tech businesses to flourish - Alison Gilson
Although the Covid-19 pandemic continues to create challenging headwinds for global business, in 2020 we are also seeing opportunities for those keen to invest in the technologies that will shape the future.
Digital giants like Amazon, Google and Apple, utilising cutting-edge computer software to engage global consumers and businesses are thriving at a time when other sectors face real challenges. Tech is a ‘sweet spot’ in economic terms. According to Government statistics, in 2018 alone the digital sector (from software publishing to electronic manufacturers) was worth over £400m daily to the UK economy.
The UK technology sector is diverse and recent disruptions caused by both the pandemic and geopolitics has created greater opportunities both here and abroad for the further development and utilisation of a range of products and services. However, at the same time, these same factors have influenced how businesses in the technology space operate. Innovating for the future is vital but they must also have an eye on sustainability and be cognisant of wider societal issues.
Accordingly, businesses able to develop ground-breaking technology, whilst also supporting global causes, are attractive to investors. A good example is UK-based Extreme E, a client that my corporate team is proud to have supported since its launch. Earlier this month, Extreme E secured additional investment funding to help the business push ahead with their ambition of launching an all-electric off-road Sports Utility Vehicles (SUV) race series in 2021.
It’s the type of innovative business that engenders real enthusiasm. In addition to creating an exciting new racing concept that fans can engage in virtually, it’s contributing to the development of the technology required to assist in the evolution of electric vehicles – and showcasing globally part of the solution for climate change.
Just as businesses like Extreme E accelerate forward with their green tech ambitions, so too is the UK energy sector as it pursues net zero (carbon) emission targets. In September it was reported that the Solar Trade Association (STA) and Renewable UK will encourage members to work more closely with the UK technology sector to achieve outcomes.
This includes ‘integrating smart systems into the growth of the renewable and energy storage industries’. Shoosmiths' energy and infrastructure team work closely with clients actively involved in the decarbonisation of electricity, heat and transport and is currently advising on a number of matters, including both onshore wind and hydrogen projects.
There will undoubtedly be economic and technical hurdles to overcome but the pursuit of sustainable technology an area that should thrive in the future.
Certainly, technological innovations that can be viewed positively both socially and politically in pursuit of sustainability and carbon-neutral goals should be well placed to attract investment.
In our experience, businesses in this sector are becoming increasingly attractive to investors, from private individuals and angel syndicates through to private equity houses and global funds.
Despite the current pandemic (and associated economic challenges) in Scotland and the wider UK, Shoosmiths continue to act on a range of transactions that attract international investment. Arguably, that’s a positive development in the UK economy.
With the clock ticking towards the UN Climate Change (COP 26) Conference in Glasgow next year, now is the time for emerging cutting-edge tech businesses in Scotland to optimise their investment opportunities.
Alison Gilson is Partner and Head of Corporate for Shoosmiths in Scotland
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