Alastair Mitchell - The importance of 'The Scene'

The Huddle founder on why we should be proud of our entrepreneur scene. By Alastair Mitchell

Much is made of the music scene in Liverpool, the underground scene in Berlin, the arts scene in Paris - but what about the web scene in the UK? Do we have one? Is it dying in the credit crunch? Is it nothing compared to Silicon Valley? Why should we care?

As an early stage internet business ourselves, with two start-ups sharing our office and running the DrinkTank monthly meet-up, we're passionate about this topic, its importance to the health of our industry and to that of the whole UK economy.

Let's start by looking at whether or not we have a UK web scene at all.

• Q: What were the highest profile social software exits recently?
• A: Last.Fm and Bebo - both UK.
• Q: Who's just bought a flagship global technology company, bucking the doom in the market?
• A: Autonomy, also UK, having just bought Interwoven.
• Q: How many web events are run each month?
• A: More than 50 in London alone.

So that'll be a Yes then.

What about the health of the scene?

Well there's no doubt that we're seeing the wholly expected flight to 'safe' later stage and VCs looking after their own rather than new investments. So far so 1999....but there are some strong exceptions.  After all, if no one is going to be exiting for three years, surely now is the perfect time to be investing early?

Firstly, the few remaining early-stage VCs such as Eden Ventures in Bath and Pentech in Scotland are still active. As is Index's SeedCamp initiative, now in its third year. The government-backed funds are also investing.  Finally, we're seeing a strong resurgence of the 'super angels' who, with a higher appetite for risk and ability to move fast, are snapping up a number of excellent deals. So there is money out there - but it's much harder, valuations are lower and everything is taking longer.

Let's give that question a Yes/No.

And what about the UK vs. Silicon Valley? Can we compete?

Whilst there have been some very notable successes it's true that most of the traffic is one way and that the UK web scene is nothing like the vitality of Silicon Valley. Why? The answer is simple: geography.

The sheer size of the US means that any company starting out there can do well simply by serving the home market. Although there are legal and cultural differences between states, these are much less than those across Europe and give any US based start-up a massive advantage.

This size also means that travel is much harder and more expensive, so the web has a natural role in helping people to socialise and work together.

Finally, and crucially, this size also means that for a scene to develop it has to be located in a single relatively small area. In the web, this happened (by dint of fortune and history) to be in a valley in Southern California.

In the UK, because we are so tightly jammed into this small island, we can live much further apart and still get by; this is not conducive to a tightly knit scene. Also, this urban spread means that there are a lot of distractions that make it much harder to create a single vibe. In Silicon Valley there is technology. That's it. It's all you do, all you talk about in the coffee shop, after work and what all your friends do. Culturally barren, geeky and very incestuous - but an absolutely perfect breeding ground for a strong scene.

So the answer to that question is Yes, the scene here is a pale imitation of the US.

But why we all should care and what can we do about it?

Well, for the answer to that you'll just have to read my next article to find out...

• Find out more about Alistair at Huddle.