Discussing the UK’s growth infrastructure
In October 2024, Barclays Eagle Labs, in partnership with Beauhurst, published Exploring the UK’s Growth infrastructure potential, a report examining the status of the UK’s infrastructure, specifically office and lab spaces, computing resources, and energy. Exploring the UK’s growth infrastructure potential is part of a series of thought leadership reports from Barclays Eagle Labs, funded by the UK Government.
28 March 2025
Date of webinar: 3 March, 2025
Panel: Ayaan Mohamed Ali (CEO and Co-founder of Digitech Oasis), John Spindler (Twin Path Ventures) and Henry Whorwood (Beauhurst)
A webinar was held to discuss different viewpoints of the report’s findings, featuring an investor and a founder with experience into how the UK’s infrastructure affects businesses. Ayaan Mohamed Ali, CEO and Co-founder of Digitech Oasis, shared her thoughts on the role of local government in encouraging patient capital, while John Spindler from Twin Path Ventures provided an investor’s view on the impact of growth infrastructure when looking for investment opportunities. Henry Whorwood from Beauhurst also outlined key trends from the report.
For a more detailed look at the data and insights, please read the full report.
Presentation highlights
- The UK's innovation economy remains highly concentrated, with only a small proportion of businesses securing equity investment, grants, or patents.
- Growth infrastructure plays a crucial role in shaping sectoral development, influencing everything from office space to AI compute capacity.
- Manchester has emerged as a key hub for technology and innovation, benefiting from strong public-private partnerships and university collaboration.
- AI and Life Sciences continue to attract investment, but access to high-performance computing and lab space remains an area for further development.
The role of growth infrastructure
Infrastructure goes beyond access to finance and talent—it also includes office space, lab facilities, and high-performance computing capacity. As Henry Whorwood explains, "Under this heading of growth infrastructure, we're effectively including everything else in the real environment".
In the UK, growth infrastructure shapes which sectors thrive. For example, the availability of lab space significantly impacts life sciences. John Spindler notes, "We've seen a lot more wet labs come on stream across the country, which is encouraging". However, cost remains an issue, and some companies are choosing to locate in research hubs where facilities are more accessible. Spindler goes on to explain how infrastructure can lead inventors to find companies to invest in, “If you’re a VC and you’re hunting for companies, if there’s not the facilities, you can’t hunt in those areas”. He goes on to explain that a recent investment in Norwich came from the presence of the John Innes Centre, a centre for plant science and microbiology.
Regional hubs and investment trends
Manchester has established itself as a leading tech hub outside London, thanks in part to strategic investment in infrastructure. Ayaan Mohamed Ali highlights Manchester’s appeal: "What better place to start a tech company than where the first computer came from?". She also cites the city’s expanding data centre market and strong university ecosystem as key factors in Digitech Oasis' decision to establish itself there.
Despite regional strengths, securing investment remains challenging. Spindler points out a key issue: "There’s a shortage of midsize funds that will do a Series A, which makes it harder for companies to scale". This gap is driving some companies to seek funding from US investors, where larger cheque sizes are more common.
The challenge of AI compute and energy costs
The UK's AI sector is growing, but access to compute and affordable energy remains an area where founders identify room for growth. Spindler notes, "The government is worried that we may not have the data centres we need because we’ll need considerably more than we have now". He highlights that it is positive the Government have identified the issue around the need for investments, stating it will be needed in order for the UK to keep pace with other parts of the world when it comes to AI computing power. While AI businesses often operate on high margins, energy-intensive sectors such as manufacturing face greater constraints.
Bridging the investment gap
There is broad agreement that the UK needs to encourage patient capital. Mohamed Ali emphasises the role of long-term funding: "Government could explore tax incentives or regulatory frameworks to encourage private investors to adopt a patient capital approach". She highlights the effectiveness of grant funding schemes in the UK—specifically mentioning the work of Innovate UK in this space—but says that longer-term funding is what is needed for scaling businesses. Spindler adds that pension funds should play a bigger role at the earlier funding stages: "They really want to compete at the Series B, C, and D level, but the real gap is at Series A".
Lessons from other countries
The UK can learn from international examples, particularly in government-backed investment strategies. Mohamed Ali cites the US Inflation Reduction Act (IRA) as a model: "The IRA has massively incentivised investment in Climate Tech, and we need similar initiatives here". France, too, has taken a proactive approach, with Spindler observing: "Paris has multiple government-backed accelerators linked to universities, attracting talent from all over the world".
The role of accelerators and networks
Accelerators can be a powerful tool for startups, providing access to networks and expertise. Mohamed Ali shares her experience with Barclays Eagle Labs: "The biggest benefit was access to networks—industry experts, mentors, and fellow entrepreneurs". She notes that while many accelerators exist in the UK, it is important for entrepreneurs to apply for accelerators that best suit the needs of their business to ensure they are most effective. When speaking on how accelerators in the UK could be improved, she states, "Many US accelerators come with funding, whereas in the UK, in comparison to the UK".
Conclusion
The UK’s growth infrastructure is evolving, but significant challenges remain. Investors and policymakers must work together to address funding gaps, improve access to critical resources, and ensure the UK remains competitive in key sectors. “We have amazing advantages in the UK: the English language, culture, entrepreneurial talent, and our legal system. We can be a big player in tech and have proven in the past that we are,” Spindler says, before concluding, “If we want to be a major player in the 21st century, we need to make these investments now.”
Article
Exploring the UK’s growth infrastructure potential
We’ve examined the current state of the UK’s growth infrastructure, exploring the availability of office and laboratory spaces. As well as compute: hardware, software and data systems in addition to energy infrastructure.
Event replay: Exploring the UK’s growth infrastructure potential
A replay of the live discussion on the UK’s growth infrastructure potential moderated by Henry Whorwood, MD for Research and Consultancy at Beauhurst.
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