In this section we are exploring employment in startups in partnership with Dealroom. Its proprietary database and software aggregate public information via machine learning and APIs. This includes Chamber of Commerce, news flow, and user-generated data verified by Dealroom. All data is verified and curated with an extensive manual process. All jobs at start-ups are counted, not just 'tech' jobs and companies with unavailable employee data, or with 1 employee (thus not offering jobs) are excluded.
There are clear benefits to closer collaboration between policymakers and the tech ecosystem. The Covid-19 pandemic, if anything, has increased the focus on this point, as technology played a crucial role in enabling economies to adapt to the realities of virtual living and working. But even before the pandemic, Europe had started building out the "infrastructure" needed to support the growth of start-ups via a number of regional and European initiatives. This article explores the role that governments have played in supporting the start-up ecosystem following the onset of the pandemic, paying particular attention to funding relief programmes, government innovation programmes and tendering processes.
The Covid-19 response has provided an interesting prompt to review the state’s role as a direct investor in early-mid stage firms. Stopgap solutions like the UK’s Future Fund, and its equivalents in mainland Europe have given governments equity stakes either directly, or in the form of convertible loans. To date, attention has rightly focused on the vital life support these loans are providing for many start-ups and scale-ups, but it will be fascinating to see how states leverage their shares in the long term, particularly as tax payers demand transparency and accountability over the investments made.
Much has been made of Europe’s potential to create ‘entrepreneurial states’. Advocates for the idea normally focus on the state’s role in galvanising R&D and creating markets: processes that take far longer than normal political and investment timelines. But with these stakes, European governments have a petri dish to experiment with entrepreneurialism over a shorter time horizon. Will they seek profitable exits to recoup cash as soon as possible for their stuttering economies? Or will they use their stakes more strategically, perhaps crowding entrepreneurs into solving challenges in the public interest?
The French government was the first in the world to set up an Emergency Plan for start-ups: €4.3bn unlocked one week after lockdown started. We were the fastest, because it was a no brainer. We believe in the future of tech entrepreneurship and stand by our ecosystem, in sickness and in health (although, preferably health).
As we entered the pandemic, there was legitimate fear that the UK could lose a generation of start-ups if the tech ecosystem stalled. With pressure on an economy that is largely being driven by tech, intervention came from the UK Government. In addition to measures available to the market generally, HM Treasury responded to lobbying from the venture community to introduce the Future Fund scheme, a lifeline in the form of a convertible loan package for innovators in need of sustainable financing. As a member of the task force that helped the government design and implement this scheme, we have been impressed by the process and strongly encourage continued equitable innovation-friendly policy to get through these crises. It’s clear that is an investment not just in the future of tech, but our society at large.
Beyond temporary relief programs, we also wanted to get a better understanding of the other ways governments have supported start-ups across Europe.
Another way government can play a role in supporting the startup ecosystem is through contracting. Public procurement, the process by which governments purchase goods, services and works from the private sector, is a vast contributor to global spending and represents a colossal 12% of global GDP ($11T), according to the World Bank. The potential share to be won by tech start-ups, 'GovTech', is estimated to be $125B (€105B) in Europe, according to PUBLIC. As healthcare is now top of mind in light of the current pandemic, and with healthtech attracting over $4B of capital invested into European tech companies in 2020, it is interesting to explore the potential for those startups to tap into healthcare-related technology spending from government institutions. To try to shine a light on this, we partnered with Vamstar, the data science powered B2B healthcare marketplace platform that tracks and enriches contracting data published by public procurement bodies and private healthcare institutions. Although it is difficult to have data on tech start-ups more specifically, SMEs responding to health technology tenders is a helpful proxy to measure the direction of travel for the former.
PUBLIC and Vamstar’s research clearly demonstrates the unprecedented reliance by governments on the start-up ecosystem during the Covid-19 crisis. Never before has the public sector depended so heavily on new and innovative applications, developed by Europe’s brightest tech entrepreneurs.
During this time, we have seen especially high numbers of initiatives coming out of governments, which are looking to quickly identify start-ups that can help to address their most critical challenges. These challenges, competitions and programmes have helped to drive the acceleration of technology adoption across the spectrum of public services.
Whether we look at the health care sector, which of course has been under great pressure, or to those areas of the public services landscape that are less prevalent in the public consciousness, such as social care and education, startups have been at the heart of finding new ways to deliver critical services.
Before the pandemic, the GovTech market, the start-ups and technologies driving the transformation of public services, was growing rapidly; entrepreneurs, investors and policy makers began to believe in the benefits in terms of cost, efficiency, and the positive impact on the lives of citizens.
The trends we’ve seen during COVID have validated this belief. I hope that, looking to the future, governments will continue to harness the flexibility and resilience of startups that we’ve seen throughout the pandemic. In doing so, I really believe that we’ll see a positive transformation in the way that our public services are provided, and ultimately used, by citizens globally.
We currently have to browse through a lot of pages and it would be easier to view by timeframes as we need to go through several pages only to realise the deadline has passed. Marketing upcoming tenders more effectively would also enable us to rely less on consulting firms.
Decision making in healthcare systems is typically driven by risk rather than opportunity. In March, adopting new technology moved from being an opportunity to an imperative, as systems needed to be able to deliver care remotely and communicate more efficiently. Existing inefficiencies in the system were accentuated, and we've been fortunate to be able to help whilst accelerate our existing roadmap, rather than develop Covid-19-specific products.
We went from 50% of GP practices in England using us to 95% in the space of four weeks, and we rolled out six major new features in as many weeks. We were only able to do this because we let frontline staff pick software that works for them, set it up, and use it. This is not how software in healthcare is typically implemented, but we believe when the 'users are choosers', they'll consistently raise the bar, as the wider SaaS industry has shown.
To continue with digital transformation at pace, health systems need to find faster and clearer routes for effective innovations to be tested and adopted. Right now, there isn't a challenge spotting problems or building the technology to solve them, but knowing what to do next is where innovations stop. We need to move from a place where IT budgets are fixed, regardless of technological progress, to one where new solutions that create value across the system can be rapidly procured and adopted.
The innovations that have scaled and worked in 2020 have also been free from the AI/wearables/personalised medicine hype often seen in healthcare. That's not to say these technologies won't play a role in the future, but healthcare systems are currently decades behind. Particularly in times of crisis, staff value software that makes their day easier and just works. That's what we need a lot more of.