London beats New York, Paris and Hong Kong as the most expensive office space in the world for tech startups in terms of price per sq ft. According to the Knight Frank 2017 Global Cities Report, a 600 sq ft office space in London’s tech hub of Shoreditch costs an average of $66,706 (approximately £50,425) per year, the most expensive office space of any creative district globally.
Commenting on the findings, James Roberts, Chief economist at Knight Frank, warned that the high rental costs could impact heavily on London's ability to produce an internationally successful tech firm on the scale of those found in Silicon Valley.
“Collaborative offices are consequently playing a vital role in offering affordable business space, but for startups to move to stage two as companies, they will ultimately need their own offices. London needs to be more affordable for tech firms if it wants a home-grown Google or Twitter," he said.
With high rental costs impacting the bottom line of tech startups in London, it is essential that business owners maintain effective management of their company’s working capital. This will not only help to ensure you have the cashflow needed to survive and thrive, it will also expose any pressure points within the cash cycles, helping you boost efficiency and even save costs – all vital elements in helping your business survive and thrive in challenging times.
At Beavis Morgan, we specialise in working with startups and entrepreneurial people. We are on hand to provide guidance and strategic advice to help in formulating plans for your business in order to strengthen its prospects of success, achieve growth and maximise wealth, and also to help with management accounts, enabling better control of your financial situation and awareness of the business in real time, enhancing planning for the peaks and troughs. Our team at BM Structured Finance is also able to assist with your funding requirements, providing the cash injection you need to enhance cash flow liquidity and enable maximum growth.
To find out more about how we can help you and your tech business, contact Steve Govey.