At the end of the Six Nations, I have been struck by the parallel between Scottish rugby and the growth of the tech sector.
Over the last few years, Scotland have been a rugby team demonstrably capable of beating anyone in the world. Before the Six Nations began, Scotland supporters were very optimistic – despite it being 20 years since we last won the title. This optimism was tempered, though, by the accompanying commentary of Scotland’s success being dependent on keeping our best players fit. “Does the Scotland squad have the strength in depth” was the almost inevitable question put to the pundits throughout the tournament. A disappointing fifth place and a single win, amidst injuries to key players, continues that trend.
The parallel with Scotland’s tech sector is uncanny. We have proven experience of growing globally successful tech businesses of all sizes. Despite this, and the exceptional people that have built them, the biggest challenge is whether we have the depth of talent pool to accelerate more such organisations in the near term. Recent Tech Nation figures suggested that there are more than 70,000 people employed in the IT sector in Scotland. Yet there is significantly growing demand for that talent with possibly thousands of permanent roles to be filled.
Unlike the more sporadic successes of the national rugby team, the professional club game in Scotland is thriving. For the first time, both Edinburgh and Glasgow featured in the quarter finals of the European Champions Cup. We could attribute this success to the strength of home-grown players. However, many suggest that it is the result of an influx of experienced, world-class talent from outside Scotland. These diverse, international players and coaches, including South Africans, Kiwis and Fijians, are having a big impact both in what they bring directly and, more importantly, in how they influence and improve those around them.
We need to do more to compete globally with other technology hubs for experienced talent to the same effect. Yet, there are some significant headwinds of our own making. Brexit is the obvious one – impacting our existing teams and our ability to attract talent from the EU. It is not the only challenge, though. The new Scottish Government budget puts knowledge workers at a further disadvantage compared with their peers elsewhere in the UK. For example, a software engineer or digital marketer earning £55,000 a year will be paying about £1,500 more in income tax in Scotland than in England.
We may also not be retaining the talent we develop. Data from the Destinations of Leavers from Higher Education survey provided by the University of Edinburgh suggests that of the 2016/17 graduates from its School of Informatics, less than 30 per cent of those who entered the workplace did so in Scotland. And a graduate survey from Be-IT Recruitment suggests a third may drop out of the sector altogether.
It is therefore understandable that talent attraction is a top challenge for those scaling in Scotland. It is still possible to recruit and attract talented people but it requires much more effort. A simple premise for leaders is to consider your company as the product and your employees (past, present and future) as your customers and act accordingly. Louis Schena, founder of Glasgow scale-up Swipii, suggests: “Hiring is a full time job for everyone in the company. There is great talent out there but they don’t know you exist.” And there needs to be a more concerted effort in the sector to address the wider challenge. Organisations like CodeClan are highly successful in bringing great new talent into the sector, but remain focused on entry-level expertise. The attraction of experienced talent requires similar considerations. Without this, Scotland’s tech sector will struggle to sustain its ascent.
Richard Lennox, a former senior director at Skyscanner, founded Original Angle to support start-ups and scale-ups across Scotland.