With its wide range of skills, high educational standards and a long history of commerce, the city is attracting global business interest
Giant pink billboards in Scotland’s largest city boldly declare ‘People Make Glasgow’, flagging up the self-confidence of a city which has made a successful transition from former industrial powerhouse to a diverse modern economy which is attracting a new influx of ambitious global companies.
One of the newest arrivals is Spire Global, a US satellite-powered data company which has established a European headquarters in Skypark business park. Spire sets its recruitment bar exceedingly high – targeting only the top 1% of the global talent pool – and the caliber of recruit in Glasgow was a major attraction, according to Chris Wake, Spire’s Head of Business Operations.
Spire, headquartered in San Francisco, designs and manufactures powerful mini space satellites which can cover more data points on the earth than normal satellites, providing detailed timely updates on weather patterns to governments, meteorologists and businesses. Spire was introduced to Glasgow via business partner Clyde Space, a home-grown start-up that supplies small spacecraft and is now Spire’s Skypark neighbor.
Spire, which also has a base in Singapore, assesses three critical factors for locations: availability of risk capital; human talent; infrastructure (including digital and physical infrastructure and business partners) and human talent. Glasgow scored well, particularly on talent, says Wake: “We’re incredibly pleased with our hiring success. Glasgow has really great candidates and there is all of Europe to pull from.”
Wake is not alone in recognizing the importance of a vibrant business eco-system. Calum Paterson, Managing Partner of Glasgow-headquartered Scottish Equity Partners (SEP), says Scotland’s biggest city has much to offer in terms of available finance, business acumen, entrepreneurial talent and quality of life to Scottish businesses with global ambitions as well as global businesses seeking a European base.
Paterson has led SEP from start-up in 2000 to Europe’s leading venture capital investor with a portfolio of 35 high-growth companies. He is also non-executive director of portfolio company Skyscanner, the world’s fastest-growing travel search company and a Scottish ‘unicorn’ start-up with a $1 billion plus valuation.
SEP has offices in Glasgow and London and a remit to invest across the UK and beyond. In the past year it made investments totaling $15.5 million and its portfolio companies generated $1.3 million in revenues. “Scotland benefits from having a venture capital investor that is not just big in Scottish terms but prominent at a European level. Scotland is a great place to build a business from and a great place to live and work,” Paterson says.
The talent pool has benefited SEP and its portfolio companies. “Glasgow has a very high quality of talent, exceptional universities and significant expertise in micro-electronics and life sciences as well as a good business support network. Lots of Scots have worked in the States and bring back that experience and international perspective.”
Dynamic transatlantic partnerships can result in long-term investment. One example is SAS, a US-headquartered global leader in business analytics, software and services which has a thriving research and development operation in Glasgow headed by David Carrick, Managing Director, SAS R&D Scotland.
The Glasgow operation was set up following the 2010 acquisition by SAS of Memex, a Scottish company formerly headed by Carrick which became a world leader in intelligence management solutions for law enforcement and national security.
SAS, whose global headquarters is in North Carolina has more than 13,000 employees, including 140 in Glasgow. Carrick says SAS was impressed with the city’s graduates. “The talent in the software development industry in Glasgow is excellent with great universities. Students here mature quickly and you can grow and retain really good teams.”
When US executives visit Glasgow for the first time, Carrick says what surprises them most is that they are in a metropolitan city yet just half an hour’s drive to spectacular countryside. “We took US visitors to Loch Lomond and they could not believe what we have on our doorstep,” Carrick comments.
Anne Murray, Head of Invest Glasgow (Glasgow City Council’s inward investment arm), says Glasgow is a good foothold in Europe for US businesses, with no language barriers, good transport links, a competitive cost base and a well-educated workforce: more than 40% of adults are qualified to degree level.
“Glasgow has a rich artistic and cultural life – we have one of the best civic art collections in Europe and impressive Victorian and Art Nouveau architecture. We also have three international airports within an hour’s drive with direct flights to the US and other global business destinations, and direct rail connections to London,” says Murray.
The city’s diverse economy includes creative industries, renewable energy and low-carbon and financial and business services. The International Financial Services District (IFSD) includes long-term tenants JP Morgan and Morgan Stanley, both of which have more than 1,000 employees. JP Morgan established a European Technology Centre in Glasgow 15 years ago and plans to add 500 new jobs. BNP Paribas, Santander and Arthur J Gallagher also have substantial Glasgow operations.
“In a 45 minute drive you have access to a workforce of 1.2 million and in an hour you can access 2 million so it is easy to recruit and retain good people,” says Murray. She adds that labor costs can be 33% lower than in London. Property also represents good value, with Grade A and Grade B commercial property up to 75% cheaper than in London and a good development pipeline.
Glasgow is also strong in scientific research and development – particularly in life sciences. It forms part of a BioCorridor with companies including pharma giant GlaxoSmithKline linking to hospitals for research into fields such as stratified or personalized medicine.
The city’s 130,000 students include specialists in the fast-growing field of photonics. That proved a major attraction for Fraunhofer Gesellschaft, Europe’s largest provider of applied research and development services which established Fraunhofer UK Research and the Fraunhofer Centre for Applied Photonics (CAP) in Glasgow in 2012. It has 21 staff and 13 PhD students and plans further expansion.
Simon Andrews, Executive Director of Fraunhofer UK Research Ltd said: “The location is ideal, partnering with the excellent applied science and engineering of the University of Strathclyde, state of the art facilities in the Technology and Innovation Centre, excellent communications links with the rest of the UK, and access to a highly skilled and educated workforce.”
However, it’s not all high-brow business activity: Glasgow’s status as the second biggest and most successful UK shopping center outside London has attracted major US retailers including Forever 21, Hollister and American Apparel to the fashion-conscious city.
Glasgow ranked as the top Scottish city in the Mercer 2015 global Quality of Living survey and Invest Glasgow’s Murray said international newcomers are struck by the warmth of the Glasgow welcome – affirming that essentially, ‘People Make Glasgow.’