Plan for growth
Logan calls for ‘tech-scalers’ to help fuel recovery
Mark Logan: collaboration
Former Skyscanner executive Mark Logan is recommending Scotland creates a nationwide network of “Tech-Scaler centres”, incubation facilities that would help support growth of the technology sector.
In a new report, commissioned by the government, he recommends they are set up in six cities nationwide, probably Edinburgh, Glasgow, Aberdeen, Dundee, Stirling and Inverness.
They would provides long-term, affordable, high-quality incubation space and a valuable network-building and education resource.
The idea forms a key part of his report for Finance Secretary Kate Forbes who commissioned Mr Logan in May to advise on how technology can put Scotland back on the road to growth.
Mr Logan, who helped the flight comparison site Skyscanner gain a market value of over $1.5 billion during his time as chief operating officer, has made 34 recommendations which also include establishing a new fund to make strategic investments in the Scottish tech sector, assigning key performance indicators on university spin-outs and subsidising the conference sector to raise the profile of the sector with investors.
He says that apart from notable successes the country is not yet producing enough new digital start-ups to reaching the “tipping point” where the whole marketplace becomes self-sustaining.
He calls for a cross-sector and collaborative approach and makes particular recommendations on education, saying “we should treat Computing Science likes Maths or Physics at secondary school level.. change of this kind is necessary if we are serious about Scotland’s future in the global technology arena.”
Universities should be assigned a key performance indicator to increase the number of locally-resident Software Engineering/Computing Science graduates, and to increase both the number and quality of spin-outs.
The report recommends that Codeclan, the re-skilling academy, is set a target to triple its annual number of graduates, to be implemented over a 24-month period and that the organisation is part-funded by government to support this expansion using the Foundational Talent Fund.
He says it is hard to attract specialists from tech centres such as Silicon Valley because of the limited opportunities that exist in Scotland to further their career.
Many executives that do come, or are already in Scotland, therefore leave for posts elsewhere. The government, he says, should explore the option of providing start-ups with a government bond to support the 12-month salary costs and relocation costs of an executive who leaves a Scottish scale-up within the first two years of joining.
He notes the current contribution of incubators and programmes such as CivTech, but also laments – notwithstanding current Covid restrictions – the lack of direct flights to locations such as Silicon Valley and the low representation of venture capital in Scotland.
“We understand that the Scottish Government has limited powers in respect of immigration policy,” he says.
“Notwithstanding that point, we put on record here that mechanisms to attract international tech talent to Scotland, such as a Tech-Visa similar to the H1-B Visa in the US, are highly desirable as a means of widening the talent funnel.”
Financial support should be provided to Scotland’s major start-up tech conferences, to increase the mix of world-class international speakers in attendance increase the visibility of the sector to external investors and make attendance more affordable to start-ups, he says.
Kate Forbes: blueprint
“Additionally, Turing Fest has a particularly bold proposal to construct an international tech industry conference and founder education network, with Scotland at its heart, running along the lines of Finland’s successful Slush model.
“We recommend that serious consideration is given to supporting this vision for a limited funding period to determine whether similar results can be achieved here.”
He calls for the international diaspora to be tapped more actively as a strategic resource.
He says the Scottish Government should follow Ireland’s successful model, “a country with very similar international brand assets to Scotland but that makes considerably more use of them. The strategy should take into account existing assets, including Global Scot and the Scottish Business Network.
The tech sector contributed £4.9 billion to the Scottish economy in 2018 and supported almost 100,000 jobs, according to a report last year from Skills Development Scotland.
However, Mr Logan makes it clear that the tech sector itself requires considerable nurturing. There have been calls for further funding to help underpin the fragile start-up sector to ensure that new ideas are not lost as demand slows.
Finance Secretary Kate Forbes, who commissioned the review, said: “This report provides an industry-led blueprint for the Scottish tech industry, outlining the actions necessary to elevate the sector to a world-class level.
“There can be no doubt that Scotland’s economy faces significant challenges as we emerge from the coronavirus (COVID-19) crisis. I believe tech companies have a central part to play in this recovery, so helping them to flourish is now more important than ever.
“The crisis also provides us with an opportunity to reshape the economy to be fairer, greener and more innovative, and tech companies have the dynamism and growth potential to make this a reality.
“I asked Mark Logan to review the sector in recognition of this, and I look forward to outlining how we plan to take forward his ambitious recommendations.”
Mr Logan said: “I’m very excited by this close collaboration between the Scottish Government and our technology sector.
“The talent and ambition within the sector is the strongest I’ve seen in decades and creates enormous potential, not only in helping Scotland navigate this challenging period, but also in generating jobs and opportunity for our people well into the future.
“The initiatives outlined in this review would help accelerate us towards a world-class technology ecosystem, of which the nation can be proud.”
Sir Tom Hunter: need for support
Entrepreneur Sir Tom Hunter said: “Mark’s compelling review of the technology sector sets out a clear, unambiguous, dynamic and ambitious system wide operational plan to enable Scotland to lead the world.
“This has the absolute support of The Hunter Foundation my sincere hope is twofold – that industry coalesces support around delivering this Review’s recommendations and the Government provides the funds to realise them.
“Our Foundation in turn will now look to see how we can support that delivery and help ensure this doesn’t end up on a civil service shelf like so many reports before it.”
ScotlandIS CEO Jane Morrison-Ross said: “I believe we need this innovative, national, strategic approach to create a tech permaculture that will help us put Scotland on the global map as a digital nation.”
She said ScotlandIS champions digital skills and is strongly in favour of the recommendations and in putting them at the heart of what happens next.
“We need to invest in the recommendations in the report, and this needs to be approached in the round, not selectively. Taking these recommendations forward is key to creating an inclusive, innovative Digital Scotland and will provide ample return on investment,” she said.