OCTOBER TO DECEMBER 2013
INCUBATING IDEAS SOLUTIONS TO THE START UP PUZZLE
ALSO INSIDE ISSUE 46 » £25 MILLION AIRPORT EXPANSION » 10 QUESTIONS FOR THE UK GREEN INVESTMENT BANK » GUCCI ARRIVES » PRIORITIES FOR CITY CENTRE BID » WHAT’S ON IN EDINBURGH
IN THIS ISSUE THE FIRST WORD
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ello and welcome to the latest issue of Invest Edinburgh. I am delighted to announce that Edinburgh has been successful in its bid to host Scotland’s new National Performance Centre for Sport. Construction is set to begin at Heriot-Watt University’s parkland campus on the outskirts of Edinburgh in spring next year, with the Centre opening in 2016. The Centre will give Scotland’s elite sportspeople access to world-class training facilities, including indoor and outdoor football pitches, rugby pitches, tennis courts, a nine-court sports hall and a 100-station gym. A huge range of sports will be catered for including football, rugby, tennis, athletics, cricket, volleyball, badminton, basketball and squash. Members of the public will also benefit from the Centre. Winning the Centre is a major triumph, and I am confident that Edinburgh will prove a fitting home. My sincere thanks to everyone who worked on and supported Edinburgh’s bid. This issue’s Capital Focus looks at the expansion of Edinburgh Airport, which recently recorded a million passengers in a single month for the first ever time. The airport is making significant investments to increase its capacity and improve the passenger experience. Named one of the UK’s fastest growing companies by The Sunday Times, iconic wellington brand Hunter Boot is this issue’s One to Watch. The University of Edinburgh’s new life saving app is featured in Made in Edinburgh, while we welcome Italian fashion house Gucci to the city in New Arrivals. Since its establishment in Edinburgh last year, the UK Green Investment Bank has quickly emerged as a key player in green project finance. The Bank’s chair, Lord Smith of Kelvin, discusses the past year and what the future holds in this issue’s 10 Questions. Our cover feature looks at the innovative companies that Edinburgh is unleashing on the global market. The city’s thriving community of entrepreneurs – underpinned by first-rate incubation facilities – has made Edinburgh a hugely exciting place to start a new business. With businesses voting to extend Edinburgh city centre’s business improvement district for the next five years, we look at what Essential Edinburgh has planned in Making it Happen. Finally, we investigate Edinburgh’s cultural offering in Added Extras.
For a free quarterly subscription to Invest Edinburgh, or to obtain additional copies, please contact editor@investedinburgh.com
Thank you for reading,
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16 04 SNAPSHOTS
Edinburgh’s latest business news... from panda pounds to video game launches
07 NEW ARRIVALS
Luxury on offer as Gucci open first concession in city
08 10 QUESTIONS FOR...
Lord Smith, chair of the UK Green Investment Bank
10 (cover story)
INCUBATING IDEAS
How Edinburgh is solving the start up puzzle
14 ROUND TABLE
We ask entrepreneurs what makes Edinburgh a good city in which to launch a business
16 MAKING IT HAPPEN
Priorities for Edinburgh’s city centre Business Improvement District to 2018
17 ADDED EXTRAS
West End theatre and winter wonders to tempt everyone
18 THE STATISTICS
The latest key indicators for the Edinburgh economy
Follow Invest Edinburgh on Twitter. www.twitter.com/investedinburgh Follow Invest Edinburgh on Facebook. www.facebook.com/investedinburgh THIS MAGAZINE IS PRINTED ON ENVIRONMENTALLY RESPONSIBLE PAPER MANUFACTURED USING 100% RECYCLED WASTE.
Invest Edinburgh is created in a partnership between Marketing Edinburgh Ltd and the City of Edinburgh Council. It is published by Resolve Creative, Suite 104, 47 Timber Bush, Edinburgh EH6 6QH t. +44(0)131 555 7585 w. resolve-creative.co.uk
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COUNCILLOR FRANK ROSS, Convenor of the Economy Committee The City of Edinburgh Council editor@investedinburgh.com
To find out more about how we can help you invest in Edinburgh, please contact the Investor Support team at invest@edinburgh-inspiringcapital.com or on +44 (0)131 529 6600.
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EDINBURGH AIRPORT EXPANSION A £25 million terminal expansion of Edinburgh Airport will deliver a radically improved passenger experience.
An artist’s impression of the extended terminal. Edinburgh Airport is now the fifth busiest in the UK, marking its first million passenger month in July. With passenger numbers projected to increase by a third by 2020, a series of investments are underway to expand the airport’s capacity and improve customer facilities. Construction is set to begin this October on a major extension of the airport terminal building. A new security area will be built on the existing coach park, providing a new entrance close to the airport tram halt and significantly reducing queues. The extension will free up space within the existing terminal, which will be used to provide enhanced comfort and additional facilities for users of the airport. The main departure lounge will be doubled in size, while extra shops and food and drink outlets will be created. The existing retail offering will be significantly improved, with new clothing and jewellery stores and the airport’s first walk through store. Airlines will also benefit from a new business centre. The new security area is expected to open in late 2014, with the improvements to the existing terminal completing in 2015. “This is an excellent example of an exciting new development planned from
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beginning to end in Edinburgh, which has taken months – and not years – to plan and implement,” said Gordon Dewar, the chief executive of Edinburgh Airport. “Our expansion is a significant mark of our intent to transform our customers’ experience of Edinburgh Airport.” Edinburgh Airport has been named the best airport in Europe of its size for three consecutive years at the ACI Europe Best Airport Awards. In May, the airport was named the best in the UK for passenger satisfaction at the annual Airport Service Quality Awards. Recently announced new routes include a non-stop flight to Chicago from summer 2014. Reflecting its focus on the passenger experience, the airport recently installed three SONIC Common Use Bag Drop machines in the check-in hall. These devices – the first of their kind in the UK – enable passengers to print their own luggage tag, weigh their bags and dispatch them to their aircraft with minimal delay. “We know that time is of the essence when checking in and we want to make this process as quick and stress-free as possible,” explains chief operating officer David Wilson. “These new self-service kiosks are very simple to use and will speed up the entire check-in and bag
“THIS INVESTMENT IS THE FIRST OF A NUMBER THAT WILL BUILD EDINBURGH AIRPORT’S PROFILE AROUND THE WORLD.” drop process. If we can reduce the check-in time to as little as 30 seconds then we will be demonstrating our unwavering commitment to providing the best service for our passengers.” The ongoing investments are part of a wider £150 million programme of improvements over the next five years by the airport’s owner, Global Infrastructure Partners. The planned developments include an expanded immigration area, increased car parking and the addition of five new aircraft parking stands. “This investment is the first of a number of developments that will build Edinburgh Airport’s profile around the world, helping us to compete more energetically with other UK airports and those in mainland Europe,” concludes Gordon.
www.edinburghairport.com
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CHINA AND QATAR CONNECTIONS
Edinburgh’s Lord Provost visiting China. Two overseas visits have created major new opportunities for Edinburgh in Qatar and China. The University of Edinburgh, Heriot-Watt University, Edinburgh Napier University and Queen Margaret University visited Qatar to explore opportunities for research collaborations. The universities met with a number of key organisations, including Qatar University, the Qatar Foundation, the Qatar Science and Technology Park and the satellite campus of Texas A&M University.
The Qatari government is investing heavily in scientific research to help develop a knowledge-based economy. The research is focused on areas important to the wellbeing of Qataris, including fields in which Edinburgh’s universities have considerable expertise such as energy and healthcare. The visit – brokered by the City of Edinburgh Council – raises the potential of the city’s universities making joint bids for research funding. Meanwhile, Edinburgh’s Lord Provost,
the Right Honourable Donald Wilson, has signed a memorandum of understanding with the Shenzhen Municipal Bureau of Culture, Sports and Tourism on the creative industries. The memorandum unites Edinburgh, a UNESCO City of Literature, with Shenzhen, a UNESCO City of Design. The cities also agreed to establish new ‘International Creative Industry Incubation Centres’. The Incubation Centres will provide flexible accommodation for creative firms from each city, helping Edinburgh-based creative firms looking to access China’s booming domestic market. “Building on Scotland’s already blossoming relationship with China, I am confident that today’s signing will open doors for Edinburgh’s creative companies to develop further links and explore exciting new business opportunities offered by both cities’ fast-growing cultural and creative sectors,” said the Lord Provost. • In 2012, more than 11,000 Chinese tourists visited Scotland, spending £770 million. Marketing Edinburgh attended the World Tourism Forum in Beijing, in September.
LITTLE PAWS IN PANDAS’ APPEAL The future is bright for Edinburgh Zoo, which marks its centenary this year. Helped by the arrival from China of the giant pandas Tian Tian and Yang Guang, visitor numbers at the Zoo reached a record 811,000 in 2012 – an increase of over 50% on 2011. The Zoo is now the second most popular paid admission attraction in Scotland, behind only Edinburgh Castle, with the potential for further growth if the pandas produce a cub. This success has bolstered the finances of the Royal Zoological Society of Scotland, the charitable body responsible for the Zoo. Since opening in 1913, the Zoo has established itself as a globally leading organisation in scientific research, education and animal conservation. There have been countless achievements in the Zoo’s 100 years, including being the first British host for the European Endangered Species Programme in 1992, the opening of a state of the art Wildgenes Laboratory in 2010 and, hosting the world’s leading
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panda experts at the first ever Giant Panda Research Symposium earlier this year. The past year has seen a number of upgrades to the Zoo. In March, the Zoo completed its £750,000 overhaul of ‘Penguins Rock’, the world’s largest penguin enclosure. In July, the Zoo unveiled ‘Koala Territory’, the new home of Goonaroo, Yabbra, Alinga and Aligna’s as yet unnamed joey (the UK’s only koalas). “Over the years, these and other advances have all helped broaden the Zoo’s appeal to visitors,” said Jeremy Peat, chair of the Royal Zoological Society of Scotland. “It is exciting to look forward to the Zoo’s next 100 years and anticipate its future achievements for education, conservation and science.” > Find out more: www.edinburghzoo.org.uk
811,000
Visitors to the Zoo in 2012 JENNERS DEPARTMENT STORE ON PRINCES STREET HAS OPENED A NEW GIFT HALL STOCKING OVER 50 LEADING SCOTTISH BRANDS, INCLUDING CAITHNESS GLASS AND HAWICK CASHMERE.
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EDINBURGH AT EXPO REAL Investment opportunities in Edinburgh are being showcased at EXPO REAL, one of Europe’s largest real estate trade fairs, from 7 to 9 October in Munich, Germany. Edinburgh’s stand will display information on various key development sites in prime locations such as Fountainbridge, King’s Stables Road and the Cowgate. A complimentary whisky tasting event will be held on 8 October from 16:00 to 18:00.
1 TO WATCH
• Edinburgh will be exhibiting at stand 013 in Hall A1 of the New Munich Trade Fair Centre from 7 to 9 October.
HUNTER BOOT
WHY ARE THEY WORTH WATCHING? In preparation for ‘Festival’ season, in June, The Independent published their guide to the 10 best wellies. In the number one spot was Hunter. Earlier this year, The Sunday Times ranked Hunter 15th in its Profit Track 100, a league table of the UK’s 100 private companies with the fastest growing profits. WHAT DO THEY DO? They manufacture wellington boots. In fact they have done so since 1856, when the founders – Henry Lee Norris and his friend and partner Spencer Thomas Parmelee – opened their first factory in Edinburgh. WHERE HAVE THEY COME FROM? World War II saw a move to Dumfries to cope with the rise in demand. Hunter’s most famous wellie, the Original Green wellington, was launched in the winter of 1955. The company holds Royal Warrants of Appointment as suppliers of waterproof footwear to HM The Queen and HRH The Duke of Edinburgh. Royal Warrants are regarded as a mark of excellence and quality, and are highly prized as the holder must have been a supplier to a member of the Royal Family for at least five years. In 2008, a private consortium acquired Hunter and oversaw the relocation of manufacturing to China
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Visitors to Edinburgh’s stand will have the chance to win a luxury trip to Edinburgh, generously provided by the APEX Waterloo Place Hotel; Rhubarb Restaurant at Prestonfield House; the Royal Yacht Britannia; the Real Mary King’s Close and the Scotch Whisky Experience.
and the return of the firm’s HQ to Edinburgh. WHAT NEXT FOR THE COMPANY? The demographic for this heritage brand changed in 2005 when supermodel Kate Moss wore them at Glastonbury and they became the festival wellie. As reported in The Independent, their preeminent position continues and sales of fashion wellies helped push revenue to a record figure of £78 million for 2011, up 38%. Building on the popularity of its iconic brand, the company is expanding its product line with a new range of outerwear.
30 new ‘bullet trains’ will reduce average journey times on the East Coast Main Line between Edinburgh and London to just over four hours. The Hitachi Class 800 series trains will be ready by 2019. The University of Edinburgh ranks 17th worldwide in the latest QS World University Rankings. American biotechnology firm Biogen Idec is collaborating with the University of Edinburgh to improve understanding of the causes of multiple sclerosis and motor neurone disease. Travel search firm Skyscanner plans to recruit an extra 250 people over the next year to support its global expansion plans. More than 20 million people now use Skyscanner to search for flights, hotels and rental cars every month, while the Skyscanner app has been downloaded 25 million times. The fastgrowing firm has overseas offices in Miami, Beijing and Singapore and recently acquired the Barcelona-based hotel search firm Fogg. Members of the public have voted to name a new road bridge connecting Edinburgh with Fife the ‘Queensferry Crossing’. The £1.6 billion bridge is on schedule to open to traffic in 2016. Arthur’s Seat has been named the world’s 9th best city hike in Lonely Planet’s 1,000 Ultimate Adventures guidebook. The Edinburgh Festival Fringe has reported record ticket sales for 2013. The City of Edinburgh Council is investing £15 million in adding 63 new classrooms to the city’s primary schools. Edinburgh-based Vegware, which supplies compostable packaging and catering products, has been chosen to represent the UK in the 2013/14 European Business Awards. Download a free iPhone app about the 50+ bookshops in Edinburgh. www.cityofliterature.com/ bookshops
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Rockstar North’s Edinburgh offices.
MADE in EDINBURGH
UNIVERSITY OF EDINBURGH APP A free smartphone app developed by the University of Edinburgh and the University of Massachusetts is helping doctors to treat heart attacks. The GRACE 2.0 ACS Risk Calculator was developed by a team led by Professor Keith AA Fox, the Duke of Edinburgh Professor of Cardiology at the University of Edinburgh. Professor Fox used data on 32,000 acute coronary syndrome patients from the Global Registry of Coronary Events (GRACE) to produce nonlinear algorithms that can accurately predict the future risk of a patient for up to three years after the original heart attack. Users of the app input data on eight risk factors, including age, blood pressure, kidney function and the scale of the original heart attack. The app automatically calculates the likelihood of the patient suffering a second heart attack. The data provided by the app helps doctors determine
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the level and intensity of treatment that the patient requires. “Identifying those most at risk of a repeat heart attack means we can better tailor treatments to the individual and prevent further attacks,” said Professor Fox. The development of the app was supported by the British Heart Foundation and the pharmaceutical giant AstraZeneca. The app was presented to the European Society of Cardiology Congress in September and can now be downloaded for smartphones and other mobiles devices from Google Play and other app stores. The University of Edinburgh’s Centre for Cardiovascular Science is one of just six British Heart Foundation centres of research excellence. >F ind out more: www.gracescore.co.uk
THE SPENCERFIELD SPIRIT COMPANY IS TO OPEN A DISTILLERY AND BOTTLING LINE IN EDINBURGH FOR ITS POPULAR EDINBURGH GIN, COMPLETE WITH A TASTING ROOM FOR VISITORS.
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GAME ON! Where were you at midnight on 16 September 2013? For thousands of games fans the answer is queuing outside a games store: whether it was in Edinburgh, in London or in New York. Why? It was the release time for the latest version of the biggest franchise in games history – Grand Theft Auto V – developed by Edinburgh-based Rockstar North, for Xbox 360 and PS3. The previous game in the series, released in 2008, has sold more than 25 million copies and, if analysts’ predictions prove accurate, then fans will have spent more than $1 billion
in upgrading to the new version by the time you read this article. The first day sales of £496 million shattered the existing record of £310 million. The popularity of GTA lies in part to the 3D gaming universe that Rockstar pioneered with GTA III. However, success comes at a price – at $265 million in development costs, GTA V is also the most expensive video game ever produced. Scotland’s games industry is burgeoning, with many focused on mobile gaming. Latest official figures reveal close to 100 game developer enterprises registered in Scotland.
EDINBURGH FIRMS USE THEIR LOAF AND TARGET EXPORTS Three Edinburgh-based firms have boosted sales by winning new clients in the dynamic Asia-Pacific region. Genius Foods, the UK’s largest glutenfree brand, has introduced its products to Australia after striking a major deal with a leading supermarket chain. Ten items from the company’s range of gluten-free baked goods – including sliced bread, rolls, croissants and fruit loafs – will be stocked by Coles, which has over 700 stores across Australia and is used by 18 million customers each week. The deal opens up a new market for fast-growing Genius Foods, which currently exports to Europe and North America.“We see a lot of potential within Australia’s ‘free-from’ category,” said Genius Foods chief executive Roz Cuschieri. The traditional Scottish clothing firm SLANJ, known for its popular range of tartan trousers, has agreed to provide Shanghai-based Sun Fashion with samples from its golf clothing line. The deal was brokered after SLANJ exhibited at the China International Clothing & Accessories Fair in Beijing. SLANJ, which has existing customers in Europe, North America, Japan and Hong
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Kong, hopes to win sales from China’s rapidly growing contingent of golfers. Finally, Wolfson Microelectronics has secured an order from the Japanese consumer electronics company Sharp, which is to use Wolfson’s WM5102 audio system-on-a-chip in its new AQUOS range of smartphones and tablets. Described as delivering an “outstanding consumer audio experience”, the WM5012 is capable of reducing background noise on phone calls by 90%. The deal with Sharp follows orders from South Korea’s Samsung and China’s Lenovo earlier in the year, reinforcing Wolfson’s position as a leading supplier to the global consumer electronics industry.
> Find out more: www.geniusglutenfree.com www.slanjkilts.com www.wolfsonmicro.com
NEW ARRIVALS GUCCI WHO IS ON THE MOVE? Italian luxury brand Gucci, which has embodied high fashion for over 90 years, has arrived at the capital in style with two new outlets at Harvey Nichols Edinburgh. Following a three-month long fit out, Gucci has opened a ladies’ fashion and accessories concession on the store’s ground floor and a menswear concession on the first floor. WHY THE MOVE? According to Gordon Drummond of Harvey Nichols, Gucci’s decision to take almost 220m2 of floor-space in the department store reflects the popularity of the brand with Harvey Nichols shoppers in Edinburgh ever since the store first opened in 2002. “It shows the brand’s strong confidence in their sales performance here,” explains Gordon.“The concession was the natural next step.” WHY IS THIS IMPORTANT FOR EDINBURGH? Harvey Nichols is the one of the world’s leading international luxury goods destinations, a one-stop-shop for the most exclusive brands in fashion, beauty and food. Its flagship store in Edinburgh – one of just 15 worldwide – sits between the premium shopping destinations of George Street and Multrees Walk, home to brands such as Louis Vuitton, Jo Malone, Charles Tyrwhitt, Jaeger and Hawes & Curtis. The addition of Gucci reinforces Edinburgh’s high quality retail offer. “Gucci has had a tremendous start since opening in July,” adds Gordon. “Edinburgh city centre generally outperforms both the UK and Scottish average footfall and our own figures for August show an increase of 20% compared to last year.” >F ind out more: www.harveynichols.com/edinburgh www.gucci.com
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IE> The UK Green Investment Bank has just published its inaugural annual report. How would you sum up the first year? LS> Usually, start-ups take time, but we had to get off the blocks fast. Thankfully, we had a pre-launch team in place, from the Department for Business, Innovation and Skills, so in our first five months we were able to invest £635 million directly, and leveraged other money. In total, £2.3 billion was invested in offshore wind, waste recycling, waste to energy and energy efficiency projects – so each of our four priority areas saw investment within our first financial year. That’s pleasing. IE> The GIB’s remit is to address market failure while still making a profit. How challenging is it to strike this balance? LS> It is easy to find green projects and its easy to find commercial projects, but we have to operate under European scrutiny to demonstrate that projects are commercial and not a form of state subsidy. This ‘additionality’ means finding the right projects is more difficult. Other investors, such as sovereign wealth funds (SWF) want commercial terms – and we want to show that green can be profitable. It’s possible and we’re proving it.
Lord Smith
Chair, UK Green Investment Bank In its first financial year, the UK Green Investment Bank (GIB) has taken significant steps forward in its mission to accelerate the UK’s transition towards a greener economy and build an enduring institution from its Edinburgh HQ.
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IE> How do levels of market interest in the GIB compare with your expectations? LS> The market was initially very responsive, but current electricity market reform in the UK has slowed things in this financial year. That’s no criticism of government, it has to get this right and it is a very delicate balance. But while there remains uncertainty around the regulatory regime and contracts for difference, it has slowed the market. A big opportunity for us at present is nondomestic energy efficiency. If we can save hospitals and local authorities vast sums on energy, for example using LED lighting, it can pay back the investment within 6-7 years and bring long-term running costs down. That looks very promising, as we can be more flexible in funding than traditional sources such as the Public Works Loan Board. We’ve yet to invest, but we’re talking with the Scottish Government and local authorities across the UK, as well as the NHS. IE> Why was Edinburgh chosen for the GIB’s headquarters? LS> Edinburgh made an excellent case and Glasgow, Aberdeen and other Scottish cities supported its bid. That was a powerful message. Unit trusts were invented here, the city has been a banking centre since 1695,
AUDITOR PWC HAS TAKEN A 20-YEAR LEASE ON 3,000M2 OF SPACE AT THE ATRIA OFFICE DEVELOPMENT IN EDINBURGH’S CENTRAL BUSINESS DISTRICT FOR ITS SCOTTISH HEADQUARTERS.
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and there is excellent asset management expertise here. But Scotland is also a world leader in green energy, with commercial expertise in Scottish Power and SSE. Scotland has a big coastline and big tidal flows, so here we have 25% of Europe’s projected wind generation capacity, 25% of tidal energy and 10% of wave on our doorstep. Edinburgh has the track record for pioneering and innovation in both financial services and green technology, it has the financial infrastructure and it has project expertise. The city was a natural choice. Atria One, our permanent HQ, is outstanding. It offers Grade A space, has the best energy efficiency rating possible and provides views on two sides that show off Edinburgh’s fabulous skyline.
“EDINBURGH HAS THE TRACK RECORD FOR PIONEERING AND INNOVATION IN BOTH FINANCE AND GREEN TECHNOLOGY, IT HAS THE FINANCIAL INFRASTRUCTURE AND IT HAS PROJECT EXPERTISE.” We’ll be an ambassador for the city and for green investment, attracting regular high profile visitors. (For example, we welcomed a recent delegation from Westminster’s Environmental Audit Committee). IE> How challenging is it to attract the right people to come and work in Edinburgh? LS> It hasn’t been a challenge at all. I joined in May 2012 and my first task was to appoint people and find premises. We’ve now built a fantastic team of 80+ people, with 32 based here in Edinburgh. This team could work anywhere in the world, but they’re here partly because we’re a first, and partly because that first is happening here in Edinburgh. We’ve attracted some great home grown talent and from as far afield as Australia, South Africa and New Zealand and many moved north from London, relocating their families to Edinburgh. The schools and quality of life in the city are a very real appeal. IE> The GIB’s transaction team is based in London. How is the joint base working? LS> London is the biggest, most liquid financial market in the world. Foreign banks from every part of the world do deals there and we must have a team there. GIB is also a government creation, so we need to be close to them. Having said that, there’s more expertise in energy efficiency in
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Scotland and, with our HQ here we need actual dealmakers here as well, so the energy efficiency transaction team are based in Edinburgh. The joint base works very well. IE> How supportive have the City of Edinburgh Council, Scottish Financial Enterprise and Edinburgh’s business community been in helping GIB to get established? LS> ‘Team Edinburgh’ is highly professional, and they have been most supportive since our arrival. The Council’s soft landing services offered us incubation space before we were ready to move into Atria One, our permanent HQ. The Council has been helpful in other ways too. In June, we were in Zurich for a meeting organised by the Council and the British-Swiss Chamber of Commerce (BSCC). It was a valuable trip to outline our purpose and objectives. The combination with renewables is of particular interest to the financial services members from the BSCC and it was good to see the high regard for Edinburgh’s financial sector. Owen Kelly, chief executive with Scottish Financial Enterprise was in touch as soon as we arrived and opened several doors for us. David Nish, chief executive of Standard Life, is now on our board. IE> GIB made its first investment in Scotland in July, funding a new biomass boiler for Tomatin Distillery near Inverness. How does Scotland feature in the GIB’s plans? LS> With Scotland’s potential for wind, wave and tidal energy, opportunities should follow; but there are no targets by geography. At the end of the day, we’re not a venture capital fund. We have £3.2 billion to invest in the next three years and we have only 30-40 deal doers. Our focus is on £30 million+ projects where we can add value. The smaller investments, including Tomatin Distillery, are being managed through a block allocation we made to five externally managed funds. IE> GIB aims to establish offshore wind farms as an asset class. How receptive have institutional investors been? LS> Offshore finds a very receptive market, as there’s a very high capital investment involved. We’ve spoken with DONG and RWE and other operators. One option is to buy existing assets from them, but to ring fence the capital we provide for investment into new green energy projects. We are also now looking at taking on construction risk. The opportunities are there, but we have to address the risk profile.
IE> What are your long term aspirations for the GIB? LS> Well we’re the best capitalised bank in the market and, in June, the UK government announced we will receive an additional £800 million to invest in 2015/16. That is hugely significant. I have a vision that the GIB can create a new market – then we’ll really have succeeded in stimulating a green economy. Initially, we could take in other people’s money, as a fund manager: we have expertise unmatched by anyone else. Then, in time, we could go into the market and borrow money as a PLC. We want to inspire others to come into the market and do the same thing as us, sharing deals and expanding overall capacity of the market. In the UK, in the next 20 years, we need to spend £120 billion on infrastructure – that money needs to come from investors looking for long-term payback on sustainable investments.
Born and educated in Glasgow, Lord Smith’s career has spanned spells with ICFC, RBS, Charterhouse Development Capital, Morgan Grenfell Asset Management and Deutsche Asset Management. He has been a director of MFI Furniture Group, Stakis, Bank of Scotland, Tip Europe and Network Rail. Currently, he is chair of The Weir Group and SSE; a non-Executive Director of 3i Group, Standard Bank Group, and Aegon UK, and patron of the Scottish Community Foundation. In 2008, he was created Baron Smith of Kelvin and joined the House of Lords as a cross bench peer. Lord Smith holds honorary degrees from the Universities of Glasgow, Edinburgh and Paisley, where he was invested as chancellor in 2003.
www.greeninvestmentbank.com
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INCUBATING IDEAS Cities across the world are searching for the secret behind sustained economic growth in the century ahead. Is it all just an alchemical illusion?
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THE LUXURY HANDBAG DESIGNER STRATHBERRY OF SCOTLAND HAS OPENED ITS FIRST STANDALONE STORE IN THE GRASSMARKET, EDINBURGH’S HISTORIC MARKET SQUARE.
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or centuries, alchemists searched for a formula to transform base metal into gold, ultimately in vain; today, Edinburgh’s formula to generate new companies with global vision seems altogether more successful – and on the point of proving its potential beyond all doubt. Skyscanner, the Edinburgh-based online air travel website, has just announced further expansion, creating 250 jobs and its success (revenues increased by 65% in 2012 to a record £33.5 million) – while leading the pack – is far from being the only success story in Edinburgh. In fact, it is just the latest development in a story that has been a decade or more in the making. In life sciences, firms such as clinical grade stem cell supplier Roslin Cells are world leaders in the field of regenerative medicine; in digital media, fantasy sports website operator FanDuel runs a multi-million dollar company from Edinburgh with a customer base that’s entirely in the USA. And in business software, AIM-listed Craneware has established a leading international reputation for its hospital billing, auditing and compliance software, reporting a 16% rise in first half pre-tax profits in 2012, at $10.8 million. Behind this group of elemental forces lies a periodic table of new talent: each share certain properties with one of the pacesetters, but all have unique attributes and potential. Of more than 500 university spin-outs in Scotland since 2001, 244 have been formed from the University of Edinburgh alone, which puts Edinburgh alongside Cambridge and London as a source for UK digital start-ups. “There are now approximately 100 technology companies in the centre of Edinburgh alone,” says Colin Adams, director of commercialisation for the School of Informatics at the University of Edinburgh. These include Skyscanner, FanDuel and Cloudsoft, which began in the School of Informatics’ own business incubator at Appleton Tower and whose application management platform is already automating enterprise applications for many major corporations. “Betfair are one of our clients,” explains Cloudsoft co-founder Duncan Johnston Watt. “They handle more financial transactions on a daily basis than all the European stock exchanges combined.” Appleton Tower is itself now one among a dozen or more business incubators based in or around the city, many tailoring their support to specific sectors. All combine a mix of physical space, mentoring and business support with access to the city’s entrepreneurial networks. Combined they establish a unique community that is already delivering on its economic potential*.
While the first online revolution was driven by social networks, and the relationships between businesses and their customers, the next wave will be as much, if not more, about B2B. Edinburgh has moved from a community of highly skilled people (46% of working age residents are university graduates) to a community of highly skilled people building companies. “The entrepreneurial streak has definitely accelerated,” says Marc Moens, a director with Edinburgh-based venture capital firm Pentech Ventures, and investor/director of FanDuel. A perfect example is FanDuel’s own offices, within TechCube, which was already full when it launched in December 2012. “This is about business,” says Jamie Coleman, TechCube’s director, emphatically.“We opened with 100 staff on site. New companies have 90 days to prove themselves, grow or they’re gone.”
“THIS IS ABOUT BUSINESS. WE OPENED WITH 100 STAFF ON SITE. NEW COMPANIES HAVE 90 DAYS TO PROVE THEMSELVES, GROW OR THEY’RE GONE.” It may seem an unnecessary pressure, but Jamie is adamant.“Helping companies to fail can be good. In renewables or life sciences it can take ten years to see a return. With technology, all you need to get into the game is a laptop. If the idea, or the team, isn’t good enough then it’s better to fail fast and start over.” For those with the right team, however... “FanDuel came to us with great technology but without a clear idea in how to monetise it,” explains Marc Moens.“At the beginning, we invested in the team.” “Companies need to have that same global aspiration as FanDuel,” adds Jamie.“We stage high profile events – festivals even, such as the annual Turing Festival dedicated to bringing together digital technology and the web within the world’s largest arts and creative gathering. These help bring in investors, like Pentech and Gill Dibner. We want their money, but we also want their networks and their experience.” Another TechCube company, Plan for Cloud, proves Jamie’s point:“They became one of the fastest tech acquisitions in Scotland when the firm was bought by Right Scale in Silicon Valley, shortly after the founders left university.” According to the Boston Consulting Group’s 2012 report, The Connected World, the internet economy accounts for over 8% of UK gross domestic product, higher than in any other G20 nation. The report forecasts that this share will surpass 12% by 2016. By then, it is projected,
* The Kauffman Foundation, an American body that researches entrepreneurship, recently published a study indicating that substantially all net new employment comes from companies under five years old.
www.investedinburgh.com
| OCTOBER TO DECEMBER 2013 | INVEST EDINBURGH 11
Creative Exchange is Edinburgh’s most recent incubator to open, dedicated to the creative industries.
almost a quarter of sales in the UK will be made online – more than double the percentage of Germany, its next nearest competitor. A HEALTHY SECTOR FOR INNOVATION Not every sector can promise investors such a quick return, but Edinburgh’s entrepreneurial community spans many sectors. “It’s the proximity of academics, clinicians, and businesses that makes Edinburgh a truly innovative city in medical research and clinical commercialisation,” says Malcolm Bateman, chair of Edinburgh Science Triangle, one of Europe’s leading technology locations for world-influencing research, scientific convergence and industry collaboration. “There’s no doubt that commercial, clinical and academic strengths, combined with
Tomorrow’s technology today.
12 INVEST EDINBURGH | OCTOBER TO DECEMBER 2013 |
“IT’S THE PROXIMITY OF ACADEMICS, CLINICIANS, AND BUSINESSES THAT MAKES EDINBURGH A TRULY INNOVATIVE CITY IN MEDICAL RESEARCH AND CLINICAL COMMERCIALISATION.” Edinburgh’s world-class talent base, makes us a powerful partner in the healthcare market. There are highly developed networks here in Edinburgh between universities, the health service, and life science businesses that facilitate the translation of innovative excellence into successful products or spin-outs.” The latest asset to be unveiled is the Digital Health Institute, one of three new Scottish innovation centres. It pulls together all of Scotland’s medical schools, NHS24, The Edinburgh Parallel Computing Centre and teams from five Scottish universities to develop technology-based solutions to help health and care staff meet demographic changes, such as the ageing population, using medical, design, informatics and business knowledge. The Institute aims to rebalance care and health provision away from hospitals to allow people to live independently. The University of Edinburgh is the lead academic partner and will manage the £10 million core funding. Such developments explain the attraction for Rock Spring Ventures, which announced
a £50 million venture capital fund earlier in 2013 to invest in early-stage life science and health technology companies based in Scotland. It expects to make its first investments, following due diligence, before the end of this year. Nine, the business incubation unit at Edinburgh BioQuarter (operated by Scottish Enterprise), is already home to several start-ups. They include award-winning i2eye Diagnostics, which was named Best New Life Science Company in Scotland in 2013 for developing the world’s first visual field analyser for patient groups whose visual field was previously impossible to test. ENLIGHTENED EXCELLENCE At the hub of developments across multiple disciplines is the University of Edinburgh’s School of Informatics, the single largest research centre in Europe.“We have the biggest PhD population in this field in the UK,” says Colin Adams. “We produce talent, knowledge and disruption. That’s where someone will be the next ‘big thing’.“ The School is a physical hub as well, with Skyscanner and FanDuel both deliberately based nearby. “We have the critical mass here; things feel really exciting – and better now than it’s ever been.” The School is also a partner in the new Edinburgh Robotics and Autonomous Systems Interaction Research Facility, which has the potential to create breakthroughs in oil and gas, manufacturing, search and rescue, defence and environmental THE FINANCIAL SERVICES PROVIDER JLT HAS CONSOLIDATED ITS SCOTTISH EMPLOYEE BENEFITS OPERATIONS AT A NEW PROPERTY IN EDINBURGH PARK.
<FEATURE <FEATURE monitoring. Computing scientists from the University of Edinburgh will join forces with experts at Heriot-Watt University in the £6 million research centre. In 2006 there were two start-ups from the School itself.“Now our start-ups number more than 60,” says Colin.“Each year, we organise Engage, Invest, Exploit (EIE). It is now one of the largest investment conferences in Europe. This year, we had 60 start ups and more than 500 delegates, including 130 investors. Next year’s event is already planned for 8 May 2014.” The event is another example of the community at work in Edinburgh.“We want to showcase all the great companies the city has to offer,” explains Colin,“We worked with Entrepreneurial Spark, which had just opened its east coast incubator at Edinburgh Napier University, and showcased some of their start-ups. “The draw for investors and serial technology entrepreneurs is simple; a rare opportunity to see a large number of hot start-ups and spin outs in one day and in one place. EIE offers a cross section of up and coming talent in the field of informatics, with ventures in biotech, cleantech, gaming, social media, web and mobile.” Entrepreneurial Spark opened in February and provides a home to 50 ambitious entrepreneurs, while Edinburgh Napier University itself has assisted more than 215 start-ups through its own incubator, the Moffat Centre, since it opened in 2004. Of these more than 130 are still active.
184
School of Informatics.
Companies were spun-out from Scottish universities in 2010/11, up from 74 in 2008/9 (Source: Higher Education Statistics Authority)
www.investedinburgh.com
The opportunity to develop the commercial potential of research-led projects is being nurtured by Converge Challenge, backed by eight Scottish universities after being launched by Heriot-Watt University. Converge Challenge gives students and staff from universities and research institutions across Scotland the chance to develop the commercial potential of their inventions through a six-month series of business mentoring and training events. A panel of judges then assess entrants’ business plans and select final winners. This year’s overall winner, Dr Michael Fontaine from the Moredun Research Institute, collected £25,000 cash funding and a further £25,000 of in-kind support from the private sector. Dr Fontaine saw off competition from a record 50 entries, from 14 institutions across Scotland, with a new platform technology that will allow the development of novel and effective vaccines against important bacterial diseases of livestock. Other entries included a ‘smart paint’ that detects structural defects and a new form of plastic that can purify water. Edinburgh’s most recent incubator, Creative Exchange, opened in July and supports 20 companies per annum in the creative sector, funded through the City of Edinburgh Council and Edinburgh College. This sector has also been boosted through a recent memorandum of understanding between Edinburgh and Shenzhen, in China (see page 4). Sitting within the wider Scotland China Plan, the agreement is developing a closer relationship between the cities of Edinburgh, Tianjin and Xi’an in the key sectors of financial services, renewable and sustainable technologies, life sciences and creative industries. “Graduates have always had the ideas,” reflects Marc Moens, who has been listening to pitches for finance for nearly a decade, since selling his own company, Rhetorical Systems, itself a spin-out from the University of Edinburgh.“The difference now is they see the community here, where it’s happened already, and they’re inspired to be a part of that. Edinburgh is an exciting place to start and grow your company, recession or no recession.” Turning ideas into global business: that’s not the gold that the alchemists sought, but it is economic treasure without a doubt.
FIND OUT MORE Investor Support t: +44 (0)131 529 6600 e: invest@edinburgh-inspiringcapital.com www.edinburgh-inspiringcapital.com
Autonomous robots have potential in oil and gas.
FORTH SECTOR INCUBATOR A unique employment and enterprise hub opening in Edinburgh this autumn will nurture social enterprises and support the city’s disadvantaged residents into employment. Duddingston Yards is being developed by the social enterprise Forth Sector on the site of a disused industrial estate in the east of Edinburgh. The £3 million custom-built facility will provide 1,900m2 of light industrial and office space. Initial occupiers at Duddingston Yards will include three social enterprises owned by Forth Sector: the commercial laundrette St Jude’s Laundry, the embroiderer Edinburgh Embroidery Services, and the soap and beauty products manufacturer Scottish Soapworks. In addition to housing businesses, Duddingston Yards will include training facilities that will be used to support up to 1,000 people with mental health problems each year, helping them overcome barriers to employment. The social enterprises based at Duddingston Yards will offer work experience and hands-on training. “This ground-breaking facility [will] provide essential space where our businesses can flourish, bringing enterprise and much needed jobs to this part of the city,” said Mike Finlayson, chief executive of Forth Sector.
| OCTOBER TO DECEMBER 2013 | INVEST EDINBURGH 13
ROUND TABLE: It is clear that Edinburgh is a hotbed of young, high-growth companies. We asked some of those involved what makes the city a good place to start a business?
John Peebles, Administrate Administrate started in the Scottish Highlands as part of a training company. There wasn’t any software out there that helped training companies run their business, so we wrote the software ourselves. As we grew, we moved to Edinburgh at the start of 2013 to attract programming talent.
“THE TALENT HERE IS RICH; IT’S INEXPENSIVE TO DO BUSINESS, IT HAS THE INTERNATIONAL REPUTATION FOR QUALITY OF LIFE AND THERE’S JUST SO MUCH GOING ON.” One of the reasons I’m with Administrate is because of I love living in Edinburgh. It is a breathtaking city, one of the most beautiful in the world. After exiting a tech start-up in Florida, my wife and I made a list of cities that we wanted to live in, and Edinburgh was on top of that list. The tech community here is extremely vibrant, and very rich with talent, and you can plug in quickly. There are tons of monthly meetings across the tech community and several annual conferences that attract technologists from around the world. Compared to other cities, it’s very inexpensive to do business here, it’s just a short flight from Europe, and geographically we can service markets in North America, Europe, the Middle East, and Asia without some of the timezone challenges I’ve faced in North America.
14 INVEST EDINBURGH | OCTOBER TO DECEMBER 2013 |
Along with the rest of the UK, Scotland has some incredible tax incentives available for entrepreneurs that you won’t find elsewhere. Scotland also has world class start-up space. The TechCube, where we’re based, really helps small companies like ours grow and get exposure to other companies and events that we’d not normally get access to. Just a couple of blocks away is the main campus of the University of Edinburgh and its excellent School of Informatics, which provides a steady supply of top graduates each year. You can enjoy an incredible quality of life in Edinburgh too – there’s just so much going on with all the festivals that are happening year round and the restaurants and entertainment options that are available are incredible. I can’t think of a better place to live or start up a business.
For a company at our stage of development, it’s a good place to be – TechCube gives us fantastic infrastructure, a network of like-minded companies, access to pooled knowledge and introductions to investors. TechCube itself is a great thing for Edinburgh and for Scotland. It sees itself as a start-up project and has a real energy – it is becoming a hub of the Scottish tech ecosystem. We’ve built a market-driven product which has had a fantastic response from our beta customers. Once we’re sure that we have achieved product-market fit, our next challenge will be to scale quickly. One of the advantages of Edinburgh is that there is a pretty good supply of quality developers, so that’s one less problem to worry about!
“TECHCUBE GIVES US FANTASTIC INFRASTRUCTURE AND A NETWORK OF LIKE-MINDED COMPANIES AND INTRODUCTIONS TO INVESTORS.”
Duncan Johnston Watt, Cloudsoft We’ve been based in Edinburgh from the beginning. In truth, we set up here initially for a mix of reasons, but the talent pool in Edinburgh is phenomenal. I couldn’t ask for better co-founders: Our chief technology officer, Alex Henveld, is a Marshal Scholar who relocated here from the USA and has never looked back; and our chairman Derek Gray has been an unswerving supporter with second to none experience both as an entrepreneur and as an executive vice president with Adobe. Cloudsoft began life at Appleton Tower, hosted by Informatics Ventures, but we moved into TechCube at the beginning of this year. Jamie Coleman has created a fantastic community here – the nearest comparison is Silicon Roundabout in London.
THE RANGE IS OPENING A NEW DEPARTMENT STORE OFFERING HOME, LEISURE AND GARDEN PRODUCTS IN THE SUBURB OF BRUNSTANE THIS OCTOBER.
THE ‘AFFORDABLE FASHION’ CHAINS BLUE INC, SCHUH AND TK MAXX ARE OPENING NEW STORES IN EDINBURGH.
Steven Drost, Stipso I met Brian, my co-founder at Stipso, when we both lived in Barcelona, but we decided to move to Edinburgh for both personal and professional reasons – the ecosystem here seemed better suited to our purposes.
<INSIGHTS
Sandy Finlayson, MBM Commercial In terms of university spin outs in the UK, Scotland is the top performing region – and most of this activity is happening in Edinburgh. New initiatives like TechCube and eSpark are already a central part of the city’s entrepreneurial ecosystem. Combine that with the excellent talent pool here, and the backing of successful and supportive business angel syndicates, and it’s a recipe for success. However, the challenge now is to make it easier for a world class entrepreneurial business leader based here to access the capital they require beyond the level that angels can finance.
Aidan Courtney, Roslin Cells We established the company in 2006 to produce clinical stem cells. In launching we took advantage of the resources at The Roslin Institute, but benefited greatly from a broader initiative to establish Edinburgh as a globally competitive centre for regenerative medicine. Our ability to bring that vision to life is due to our ability, here in Edinburgh, to recruit a highly gifted and professional team.
Diane Harbison, Edinburgh BioQuarter When the University of Edinburgh joined forces with Scottish Enterprise and NHS Lothian to create the BioQuarter, the partners identified three core aims for the new organisation: to foster deeper links with industry through collaborative
www.investedinburgh.com
research; to create new companies based on Edinburgh’s research base, and to encourage a culture of commercialisation in the NHS and among academic researchers. With our long experience of company creation the commercialisation team can work with researchers and clinicians here to build business plans that are investor-ready. A part of our efforts to build greater engagement in commercialisation is our seminar and conference programme, and the BioQuarter also runs an annual innovation competition. To date, this has been a resounding success, with 100 entries in its first two years and four new companies set up among the winners.
Marc Moens, Fanduel Fanduel basically invented the sector of daily fantasy sports here in Edinburgh, despite the fact that our target market is almost entirely in the US. We began less than five years ago, but we are already a strong Scottish company, and remain a market leader in the US. Edinburgh has a good supply of graduates from its universities. In addition, there is a range of key technology employers here, ranging from companies like Fanduel and Skyscanner, to Amazon’s development centre. Because so many good companies are already here, Edinburgh has an excellent pool of engineers and can continue to attract new people. It’s easy to convince people to come to and stay in Edinburgh, both younger recruits and those with families. The entrepreneurial environment has been developing for several years and the start-ups of today can find a lot of support in our local environment: there’s a network
“BECAUSE GOOD COMPANIES ARE ALREADY HERE, EDINBURGH HAS AN EXCELLENT POOL OF ENGINEERS AND A GOOD SUPPLY OF GRADUATES FROM THE UNIVERSITIES.”
of entrepreneurial expertise ranging from fundraising and recruitment to overseas expansion; there are investors who have been there and done it themselves; and there is good additional support from the public sector. We invest across the UK, but we find there are plenty of good opportunities on our doorstep: being based in Scotland ourselves, we’re closer to these opportunities, and can get in earlier. You know that if you support a company in Edinburgh, that company will be able to attract global talent, can reach its market in the UK and overseas, and can become a world leader.
Colin Adams, School of Informatics The School of Informatics is the largest single research centre in its field in Europe. We have 500+ researchers in one building and the best research in the UK – that’s ranked by the UK Research Assessment Exercise. We draw talent from more than 60 nationalities and that background spills through in ideas. It’s a healthy catalyst that has seen 60 start ups – more than any other UK academic school – and in six years they’ve attracted more than £17 million in seed money and attention from all over the world.
“WE DRAW TALENT FROM MORE THAN 60 NATIONALITIES AND THAT BACKGROUND SPILLS THROUGH IN IDEAS.” Appleton Tower is our launch space, but the start-ups graduate to TechCube and other sites locally. Skyscanner are close to the School, and with many other slightly older spin-outs still close by, this area of town is now referred to as ‘Digital Southside’. Skyscanner and Fanduel both work closely with the technology community and give back a lot, especially with their experience. We have the critical mass here now. It feels really exciting and better now than it’s ever been.
| OCTOBER TO DECEMBER 2013 | INVEST EDINBURGH 15
<MAKINGITHAPPEN
BACKING FOR CITY CENTRE VISION “It’s the best of Edinburgh, but it feels like I’m overseas.” That was how one local described the atmosphere in George Street this August. Edinburgh’s premium shopping destination was pedestrianised for three weeks during the Festival Fringe, with al fresco drinking and dining, iconic festival venue the Spiegeltent, and live music performances all combining to create a unique festival feature. This dramatic transformation was masterminded by Essential Edinburgh, which has just begun its second five-year term running the city centre business improvement district (BID). “The BID vote, in May, saw 58% of all businesses in the city centre participate, and 78% backed our vision for the next five years,” says Andy Neal, chief executive of Essential Edinburgh. Coordinating the licence applications and planning approvals for the transformation of George Street is one example of how BIDs such as Essential Edinburgh are adding value.
“We measure the impact of all our initiatives and events,” explains Andy. “Many of the restaurants and bars on George Street already report their best ever trading figures.” The success of the initiative is being watched closely, with city planners considering future planning regulations on Princes Street. “George Street has become one of the top retail streets in the UK,” explains Andy, “but it also hosts venues such as Tigerlily, an internationally-renowned night club and restaurant within a hotel that CondeNast Traveller lists as ‘One of the coolest 65 hotels in the world’.
“WE AIM TO RECONNECT RESIDENTS WITH THE CITY CENTRE AND IMPROVE SIGNAGE TO MAKE IT AS EASY AS POSSIBLE FOR VISITORS TO NAVIGATE. ”
78%
businesses backed Essential
Edinburgh’s vision for the next five years.
“Relaxing planning regulations for Princes Street could create a very special street for the future,” adds Andy, “but our role is to make the city centre great for the businesses that are already here. We focus on what we can achieve.” Loss prevention initiatives such as ‘Check Out’ and BID-funded CCTV have helped cut retail crime by a third in three years, while Essential Edinburgh’s Clean Team inspect steps, doorways and basements of every BID business by 8am each morning to ensure the city centre looks its best. The focus for the next five years is on promoting the city centre and ensuring the city centre is clean and attractive for all businesses. “There’s an increased expectation around the quality of public realm, and our work there complements the Council. “Edinburgh’s city centre undoubtedly benefits from the city’s tourism appeal but, inevitably, recent disruption to traffic during construction work for the trams did impact on footfall. While the BID district significantly outperforms both UK and Scottish average footfall, we’re determined to build on that.” The run-up to Christmas, which will see St Andrew Square become a central part of the city’s Winter Festival, will also coincide with a campaign to promote the city centre. “We aim to reconnect residents with the city centre and improve signage to make it as easy as possible for visitors to navigate. There’s free parking on Sundays and world-class gems such as the nearby National Museum of Scotland and National Galleries to enjoy. People can come in, shop, eat and visit the attractions, spending the entire day in the city.” The BID has an annual budget of £1 million to build footfall and deliver on its commitments. It also secures savings for local businesses – from reduced crime and new combined utility contracts, which help many BID members reduce their operating costs. “We want to give levy payers good value for their money: we ask them what they want – and then we deliver it.”
www.essentialedinburgh.co.uk
16 INVEST EDINBURGH | OCTOBER TO DECEMBER 2013 |
THE ICONIC FOOTWEAR CHAIN DR. MARTENS HAS LAUNCHED A NEW STORE ON PRINCES STREET.
<ADDEDEXTRAS
THEATRE LEADS THE CHARGE
War Horse – coming to the Festival Theatre in January.
The 2013 Edinburgh Fringe Festival was officially the world’s single biggest arts event. Figures released in August showed that more than 1.9 million tickets were issued, for a total of 45,464 performances packed into the space of three weeks, across 273 venues in the city.
Rodin’s The Kiss.
www.investedinburgh.com
But just because world-renowned events such as Edinburgh’s International Festival and the Fringe are finished for another year, the city’s cultural life does not go into hibernation. Far from it, Edinburgh’s stages, screens and streets will be full of exuberant life each and every day until 1 August 2014, when the Fringe next springs into life. It’s an enchanting tale that would itself be fit for telling at the Scottish International Storytelling Festival, staged in Edinburgh each October. Many of the exhibitions launched in the Edinburgh International Festival run through the autumn, including Mary Queen of Scots at the National Museum of Scotland (itself voted the UK’s most popular museum in 2013), which runs to 17 November; Peter Doig’s No Foreign Lands at the National Academy, which runs until 3 November; or Man Ray’s Portraits at the Scottish National Portrait Gallery, which finished on 22 September. And if that’s not enticing enough, the National Galleries of Scotland have a permanent collection of more than 96,000 works. One cultural icon on display until August 2014, is Rodin’s The Kiss, surely one of the most famous sculptures in the world. Edinburgh has dozens of cinemas ranging from IMAX to art house, and four major theatres staging year-round
productions. As well as opera, ballet and every conceivable type of live music, the city hosts regular touring productions from London’s West End. The National Theatre’s award-winning production of War Horse comes to the Festival Theatre from 22 January to 15 February 2014, while the Edinburgh Playhouse – the UK’s largest theatre with more than 3,000 seats – will be hosting the West End production of The Lion King from October to January. At the same time, the Lyceum Theatre will stage four world premieres in its autumn schedule. Edinburgh’s 2013 Christmas season will this year feature the beautiful Paradiso Spiegeltent in St Andrew’s Square, staging shows by the international circus hit LIMBO, plus popular family plays Captain Flinn and the Pirate Dinosaurs and Little Red Riding Hood. Other attractions will include a Scottish market showcasing the best of the nation’s food and drink, an extensive German market and a Christmas Tree Maze in Princes Street Gardens. With all this entertainment on hand year-round, the challenge is knowing which way to turn next.
www.eventsedinburgh.org.uk
| OCTOBER TO DECEMBER 2013 | INVEST EDINBURGH 17
ANNUAL STATISTICAL OVERVIEW JOBS IN EDINBURGH BY SECTOR (2011)
POPULATION OF EDINBURGH BY AGE BAND (2012)
Manufacturing (7,300) Primary industries (3,300)
Construction (9,000)
85+
3
Male
75–84
10
65–74 Age (years)
7
16.6
55–64
Information and communication (12,400)
19.4
24.8
45–54
32
34.2
25–34
Other service and household activities (15,500)
25.6
31.7
35–44
32.8
42.5
44
20–24
23.2
25.3
16–19
10.9
Public administration, education, health (93,200)
Hospitality (26,800)
10.8
37.7
0–15
Transport and storage (10,200)
Female
14.6
35.7
50 40 30 20 10 0 10 20 30 40 50
Financial services (34,600)
Population (‘000s)
Wholesale and retail (36,400)
Business services (53,400)
Source: Office for National Statistics
Source: National Records of Scotland
WORKING AGE POPULATION OF EDINBURGH BY HIGHEST QUALIFICATION (2012)
BUSINESSES IN EDINBURGH BY EMPLOYEE SIZE BAND (2012) 50–99 (170)
100–249 (115)
No qualifications (19,100) Other qualifications (18,600)
20–49 (490)
250+ (105)
10–19 (1,085)
Standard Grade (42,600)
5–9 (2,060) Degree or above (154,600)
Higher/ Advanced Higher (71,600)
0–4 (10,875)
Higher National Certificate/ Diploma (40,400)
Source: Office for National Statistics
Source: Office for National Statistics
FOREIGN LANGUAGES SPOKEN FLUENTLY BY RESIDENTS OF EDINBURGH (2012)
JOBS IN EDINBURGH BY OCCUPATION (2012) Elementary (7%)
5% ) i( 2.
Sales and customer service (8%)
rd
6% )
% )
bi ja
(1 .8 an
Language Source: The City of Edinburgh Council
18 INVEST EDINBURGH | OCTOBER TO DECEMBER 2013 |
3% )
Professional (30%)
2% )
(0 .
(0 .
Skilled trades (8%)
Ar
ab
ic
(0 .
e es
on
r in Ca
nt
da
i( 0. ab
an
nj M
Pa
0
4% )
6% )
(1 .0
an
is h
(1 .2 n
Sp
lia It a
1
Caring, leisure and other services (8%)
% )
% )
rm Ge
2
Managers, directors and senior officials (8%)
Process, plant and machine operatives (3%)
-U
(2 . h nc
Pu n
3
Fr e
Percentage (%)
4
Polish (4.8%)
5
Administrative/ secretarial (11%)
Associate professional and technical (16%)
Source: Office for National Statistics
NESPRESSO IS TO OPEN A NEW COFFEE ACCESSORIES BOUTIQUE ON MULTREES WALK, EDINBURGH’S LUXURY SHOPPING STREET, THIS WINTER.
<THESTATISTICS
KEY DATA
Indicator
JOHN MENZIES PLC Number Date Source
Population
482,600
2012 National Records of Scotland
Households
224,300
2012 National Records of Scotland
Working age population
338,300
2012 National Records of Scotland
Average annual wage of workers
£24,700
2012 Office for National Statistics
Average annual disposable income
£24,600
2012 Office for National Statistics
Annual output per worker
£57,600
2011 Office for National Statistics
Average annual office rent
£290 per m
Average residential property selling price Annual airport passengers Annual rail passengers
2
£217,000
2012 Ryden 2012 Registers of Scotland
9.2 million
2012 Civil Aviation Authority
26.6 million
2012 Office of Rail Regulation
Annual tourist visits
3.7 million
2011 VisitScotland
Annual tourist expenditure
£1.2 billion
2011 VisitScotland
John Menzies has significantly expanded the market presence of its cargo and baggage handling division by acquiring two of its peers. The company has paid a total of £14 million for the Columbian firm DESACOL and the Australian firm Skystar. The acquisitions give John Menzies a footprint in Latin America and Oceania, as well as new business with major airlines such as LATAM and Qantas. FIND OUT MORE: www.johnmenzies.com
SAINSBURY’S BANK PLC
EDINBURGH’S TOP COMPANIES BY PRE-TAX PROFITS (2011)*
Pre-tax profits (£million)
Company
Sector
Scottish Widows Group Limited
Insurance and pensions
£684.0
Diageo Scotland Limited
Distilling
£627.0
Standard Life PLC
Insurance and pensions
£595.0
Heineken UK Limited
Brewing
£350.9
Tesco Personal Finance PLC
Banking
£159.6
Lloyds TSB Scotland PLC
Banking
£134.0
Walter Scott & Partners Limited
Fund management
£94.1
Wood Mackenzie Limited
Consultancy
£66.1
Marine Harvest (Scotland) Limited
Seafood
£57.2
AEGON UK PLC
Insurance and pensions
£49.9
John Menzies PLC
Logistics
£48.5
Concept Systems Holdings Limited
Software development
£48.1
First State Investment Management (UK) Limited
Fund management
£45.9
Sainsbury’s Bank PLC
Banking
£39.7
Scottish Water Business Stream Limited
Water and sewage
£32.8
Edinburgh Partners Limited
Fund management
£25.9
Artemis Asset Management Limited
Fund management
£24.4
Edinburgh Airport Limited
Airport operation
£22.7
Hunter Boot Ltd
Footwear
£22.1
Petroleum Experts Limited
Software development
£18.2
Forth Ports Limited
Port operation
£15.6
Macfarlan Smith Limited
Pharmaceuticals
£14.8
BlackRock International Limited
Fund management
£14.4
The Glenmorangie Company Limited
Distilling
£10.8
The Scottish Salmon Company Limited
Seafood
£10.8
Sainsbury’s Bank has recorded strong growth, with customer accounts rising by 8% in 2012/13. The firm has leased a 7,400m2 office building in Edinburgh Park to serve as its new headquarters. Sainsbury’s Bank plans to grow staff numbers by approximately 20% over the following year and has already made a key appointment in Mark Mullington of ING as its new chief risk officer. FIND OUT MORE: www.sainsburysbank.co.uk
THE GLENMORANGIE COMPANY LIMITED The Glenmorangie Company has reported strong sales of its two flagship Scotch malt whiskies, Ardberg and Glenmorangie, with increased demand from both established and emerging markets. The company has announced plans to grow sales further using the distribution network of its parent company, the luxury consumer goods giant LVMH. FIND OUT MORE: www.theglenmorangiecompany.com
* Excludes trusts
www.investedinburgh.com
| OCTOBER TO DECEMBER 2013 | INVEST EDINBURGH 19
PRIME HOTEL DEVELOPMENT OPPORTUNITY EDINBURGH CITY CENTRE: 6-8 MARKET STREET, EDINBURGH, EH1 1DE On the instructions of The EDI Group Limited, Jones Lang LaSalle is pleased to announce an exemplary hotel development opportunity in the heart of Edinburgh.
• A rare opportunity for a landmark hotel development in world famous surroundings with outstanding heritage. • An exceptionally strong tourism market with some of the highest occupancy rates in Europe. • A prime location within easy walking distance of the National Museum of Scotland and Edinburgh Castle, Scotland’s most popular visitor attractions. • Strategically located across from Edinburgh Waverley rail station, used by more than 22 million passengers each year.
The EDI Group Limited will shortly be submitting a planning application for the development of a 100 bedroom hotel on the site. Interested parties are invited to submit joint proposals with their preferred operators or to submit a lease proposal for presentation to investors. FIND OUT MORE: Keith McBain / Mark Hannah Hotels & Hospitality Group +44 (0) 131 225 8344 keith.mcbain@eu.jll.com
• Heritable (freehold) tenure.
ALL RIGHTS RESERVED. MATERIAL CONTAINED IN THIS PUBLICATION MAY NOT BE REPRODUCED, IN WHOLE OR IN PART, WITHOUT PRIOR PERMISSION OF THE CITY OF EDINBURGH COUNCIL (OR OTHER COPYRIGHT OWNERS). WHILST EVERY EFFORT IS MADE TO ENSURE THAT THE INFORMATION GIVEN HEREIN IS ACCURATE, NO LEGAL RESPONSIBILITY IS ACCEPTED FOR ANY ERRORS, OMISSIONS OR MISLEADING STATEMENTS.