Article: Is it the beginning of the end for technology companies in Silicon Fen?

Author: KISS Communications
Date: KISS Communications

Danni Amos, our Senior Account Executive shares her views on the recent sale of ARM Holdings and the wider effect that it will have on the Cambridge Cluster.

If you’re even remotely interested in tech, you’ll have seen the news recently that ARM Holdings, the jewel of the UK tech industry, has been sold to Japan’s Softbank for 24 billion. It, for many, represents the last of the sprawling multinational companies to come out of the Silicon Fen area following the sale of Autonomy in 2011 and CSR in 2014. With Brexit on the horizon and lack of big technology companies in the area, has the Cambridge Fen heyday come to an end?

To start with, let’s look at the state of the UK tech sector. A report recently published by Bloomberg highlighted that the tech sector in the UK employs around 1.5 million people and is growing 32% faster than the national economy. They also highlighted that jobs are being created at nearly three times the average rate. Whilst this sounds like good news overall, we should bear in mind that the longer term effects of Brexit are yet to be felt and the short term future is certainly looking uncertain.

With the establishment of the Cambridge Science Park by Trinity College in 1970, the amount of technology companies within the area have continued to grow - in 2004 the Cambridge Cluster report produced by Library house and Grand Thornton found that 24% of all UK venture capital was received by Silicon Fen companies. Today it is estimated that there are over 2,000 companies within the cluster.  These companies range from small start-ups with just a couple of members of staff, to local branches of global companies such as Microsoft Research, CSR and Amazon.

The success within the area is not just down to this mix of start-ups and multinational corporations. The presence of Cambridge University, arguably one of the most esteemed universities in the world, has been a driving factor in both investment and the production of talent.  Their involvement and investment in the area is felt everywhere.

In order for any area to thrive, a good ecosystem is vital. Start-ups can grow and take advantage of the networking opportunities in the area, failures are incorporated back into the mix adding lessons to be learned. Larger companies can provide opportunities for learning and development and attract investors to the area.

Of course, just because ARM has been sold, doesn’t mean that everything will change. Softbank has already committed to creating over 1,500 jobs in the UK over the next five years and will be increasing headcount outside the UK as well. They’ve also agreed to leave their business model, culture and brand unchanged. Additionally, we should consider that whilst ARM started off as a UK business, it is a publically listed company. As Venturebeat has recently pointed out, ARM has been more of a global company than a tech company for some time.

So it seems very much like it will be business as usual for Silicon Fen. ARM’s continued presence in the area will go a long way to assure local investors that it’s still the place to be for continued innovation and growth.

And I for one am excited to see what happens next.

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