With the launch of Birmingham Tech Week - the biggest festival of technology and innovation outside of London - Midlands Business Insider editor Kurt Jacobs speaks to Peter Kyle, the new Science & Innovation Secretary. He tells us about the need to attract more international investment in tech opportunities outside of London; how more start-up businesses in the Midlands need help in getting to scale-up mode. And what does it take to convince a Silicon Valley tech mogul to invest $10bn in the UK?
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00:00Hi, I'm Kurt Jacobs, the editor of Midlands Business Insider, and welcome to Birmingham
00:16Tech Week, which, with 8,000 delegates, is now the biggest tech festival outside of London.
00:23We've got lots of entrepreneurs, businesses, government ministers, investors coming to
00:28the city over the next few days to talk about things like AI, women in tech, investment,
00:34international investment. But we've also got an interview today with Peter Kyle, the Secretary
00:39of State for Science, Innovation and Technology, and I've been talking to him about how we
00:44get more international investment to UK intertech, but particularly to the regions, how we get
00:50more investments outside of London. I've been talking to him about how we get more businesses
00:56to go from start-up to scale-up. And also, what's a $10 billion question that you'd pose
01:03to a tech giant on why they should invest in the UK?
01:07So tell me about how you're going to get more investment in tech, particularly AI, international
01:14investment, from outside of London to the regions.
01:17Well, the first thing to say about the West Midlands is you have the best thing to sell
01:23in the first place, and that is talent. It is innovation that's being spun out, it's
01:28being upscaled, it's being recognised. And you have these clusters, these groups of organisations
01:34from investors to the regional authority through to universities, companies, all working together
01:41in really steadfast ways. That makes it a really easy sell. So I don't want to make
01:47out that you need somebody to go out there and be a great salesman, because good sales
01:52relies on great product. And here in the West Midlands, you have so much which is attractive.
01:57But we are in an environment where there are parts of the country that are hugely attractive
02:03to outside investors, simply because it's easy to understand. It means that we as a
02:08government need to make sure that we fully exploit everything you have and you're achieving
02:12here and get it onto everybody's radar. These things aren't always easy. What we're doing
02:17is making sure when it comes to planning, for example, that locally, your regional mayor
02:21will have the ability to shape communities and make sure that the planning reflects the
02:26priorities you have, so he can shape the economy. Once that starts happening, of course, it
02:30becomes easier to invest. In central government, when we are in these negotiations with global
02:35companies about investment, that we're always here to ensure that the talents you have here,
02:41the opportunities you have in different parts of the country are fully recognised, and we'll
02:45do everything we can do to make sure that those investors come to parts of the country
02:50like the West Midlands and see all the great activity that's happening here.
02:53You've mentioned inward investments and so forth, but how are you going to encourage
02:57at a lower level? Because one of the challenges we've got is lots of innovation, but moving
03:02from start-up to scale-up has been a real challenge. We've only got two unicorns in
03:06this part of the world, and I think we need more. How are you going to help the base level?
03:11We are an under-capitalised economy right now when it comes to investment, so we've
03:15already started the review led by Emma Reynolds in government to try and unlock the pensions
03:20capital which is being pent up at the moment. The US and other countries are very good at
03:25taking these big investment pots and making it more investment-ready for different parts
03:31of the economy. We need to learn from that experience, always make sure that pensions
03:35are cast iron and they are there to do their core business, but they are big, big sources
03:41of potential capital that we need to put to work for our economy to get growth into
03:45it and make sure that all parts of the country benefit from it. That's just one thing that
03:48we're doing, to try and get more capital into the economy so that investors, whether
03:54institutional investors or private investors, can have far more access to bits of the country
03:59like this, so that where there is an innovation, they are spun out, but they don't have to
04:03go to the US or other countries to fully exploit their potential as a business. They can have
04:08that realised here with domestic investment as well.
04:10Last question, this is a genuine last one. Tell me more about that question you put to
04:15potential investors. What's it going to take you to invest £10 billion in the UK? What
04:18are the three issues you say they keep raising?
04:21So I've been around, when I go around the world asking about investors here, I ask these
04:25questions about what it would take for another £10 billion. One of the things is the price
04:29of electricity and also they want sustainable electricity because all these companies like
04:33Google and Microsoft and others, they have their own global commitments as well to sustainable
04:37electricity. Planning is a big issue. They're not going to invest a lot of money if it's
04:41going to take 10 years to get through planning and actually have connection to the grid.
04:45And then regulation. They want to know that innovation is going to get through the regulatory
04:50landscape swiftly so they can start commercialising it, upscaling it and investing in it. These
04:55are the things that speak to a dynamic economy, a dynamic society, a dynamic government that
05:01we aspire to be. We've been working on it incredibly hard. All of these things we've
05:04spoken about, our government is already actioning in the first three months of the government.
05:09That's why last week you saw this investment summit where £64, £63 billion was committed
05:15to our economy simply because we're answering those key questions that were always put to
05:19us in opposition. We're now showing that action from government and it's unlocking investment
05:23that we need.