Virtually anything we do today can be tracked, monitored and stored in the heart of a server that sits like a big, grey battleship of a data center somewhere on the edges of the cities we live in. In 2010, Eric Schmidt, the outgoing Google CEO stated, “There were five Exabytes of information created between the dawn of civilization through to 2003. That much information is now created every two days, and the pace is increasing.”
This ocean of data and the connectivity that supports it is enabling small startup companies to collaborate, innovate and disrupt. Five years ago, we were amazed by startups that were worth $1 billion after a few short years, and the best joined the exclusive ranks of the Wall Street Journal’s Billion Dollar Startup Club. In 2014, we saw many breaking the $5 billion barrier after a few years. Uber, Airbnb and Dropbox have all become $10 billion household names in record time. Snapchat, the photo messaging app, was founded in 2012, and today is valued at $10 billion. The digital age has enabled innovative, clever ideas (or just a good upgrade of existing business models) to be turned quickly into a business model that can be replicated around the world at an incredibly fast rate.
Globally, collaboration has become a huge enabler to a startup’s success. We have seen new, collaborative shared-office environments set up to provide incubation spaces and enable them to flourish. Office projects like Shoreditch Works, which was founded in 2007, offer coworking space exclusively for startup coworkers with a low-cost, connected environment to work in.
In 2013, Shoreditch Works crowdfunded the launch of “Village Hall,” which is an events space that supports the office environment. Village Hall gives away 20 percent of its slots for free to community groups that don’t necessarily have the money to hire a big events space. It’s a space where kids can come and code after school, artists can present their work, local meetings can take place and coworkers can meet and discuss their issues.
This sharing business environment is driving a new business engagement model where legal advice can be swapped for programming time and marketing support can be exchanged for financial advice.
Is this innovative approach catching? It certainly is. Elsewhere in the U.K., Barclays Accelerator has launched the Escalator, a state of the art office and events space in Manchester and London. Manchester Metropolitan University has launched its own version, Innospace, and Loughborough University has its education and incubation space at the former Olympics Media Village now named Here East. GE Healthcare has also announced plans to launch its own version in Helsinki, a well-established hotbed of innovation, fueled by the ex-staff of a conscientious Nokia.
You have to ask: How long is it before we see a new type of landlord coming to market who is willing to provide office space in return for an equity stake in a startup’s business? Where is the bigger potential value?
This month, the U.K. government has backed a new trade body to represent and champion the U.K.’s sharing economy (SEUK). This economy enables us to share resources, property, time and skills. The SEUK Trade Body is backed by the likes of Zipcar and Airbnb, and it is estimated that this new sharing economy will unlock an additional £9 billion a year by 2025.
So what’s next? This week, I was talking to a colleague who recently visited an incubator site, and he was told a brand new app was being developed to support the next stage of wearables — insertables. No, nothing you might read about in the gossip pages. It is actually an app that records data from a device inserted into your body that will send live-fed data about your personal health to a computer in your physician’s office. The computer will raise red flags if it detects your blood pressure rising dangerously and the physician will ask you to come in. This will be on the market in two years. Proactive medicine that will use resources efficiently and tackle your health issues seems like a good idea that should catch on!
So, big businesses need to continue to watch their backs. There is more and more evidence that the established business world we know and love can be rocked or even devastated by a startup with a simple idea that catches on and changes the model. As a result, I am sure we will see more and more companies provide collaborative incubation space or programs for startups, where they can manage the risk and share in the potential success.
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Based in London, Guy heads the EMEA Corporate Solutions team for Colliers International. He was one of the first surveyors to specialize in corporate solutions in the U.K. and has worked with clients from a wide spectrum of industries including industrial, IT, financial services and consumer goods.