Among the fledgeling groups that Klein is involved with are the much-hyped London-based web start-ups Songkick, a gigs listing site, and AlertMe, a home-energy monitoring service. But while he believes that Britain’s tech scene is thriving in many ways, fast becoming a world leader in internet innovation, there is one place where the digital revolution is not breaking through: Britain’s biggest businesses.
He argues that major corporations are not taking the rise of new technologies seriously enough — as shown by the lack of chief technology officers in the upper echelons of some of this country’s most established companies. “When you look at the FTSE 100, we have a real problem,” says Klein, before rattling off the numbers to back up his argument.
“We have more than £1 trillion of market cap in the FTSE 100. They employ 6.5 million people. And yet there are only four CTOs on the board of FTSE 100 companies. What I would be worried about on the board of a FTSE 100, or as a shareholder, is why these companies do not proactively use new technologies and the internet to grow, be more productive and competitive?”
Klein passionately puts forward his thesis that, while small businesses and start-ups are roaring along on the internet superhighway, the UK’s largest companies are squandering a unique opportunity.
Recent figures from the Boston Consulting Group show that the UK is the most “internet-based” economy among the world’s developed nations. Those figures suggest that, in 2010, the internet contributed 8.3 per cent of the UK’s GDP, a larger share than in any of the other G20 economies.
“That objectively puts London and the UK at the top of the internet league table,” he says.
Klein suggests one of the factors that has allowed Britain to take this lead — internet-savvy consumers. “We’ve turned from a nation of shopkeepers into a nation of digital shoppers,” he says.
“Why are we number one? Because we spend more money on the internet than any other country in the G20. We go to Amazon, we buy cinema tickets online at Odeon. In terms of e-commerce, we are the world leaders. We spend a lot of time online. It’s no surprise that the No 1 English-speaking city in the world on Facebook is London.”
According to official figures, new and small businesses are responsible for more than half the jobs created in this country. These are organisations that are typically more advanced than more established companies in their use of technology. This gives them an advantage in exporting — using their ability to use the net to look abroad and tap into the world’s markets.
“These are small businesses selling bicycle parts to Stockport and, through Amazon or eBay, to Johannesburg and Lisbon as well,” he says.
All this means that, in Silicon Valley parlance, the “ecosystem” is thriving in Britain. An increasing number of technology businesses with revenues of up to £1 billion have been created in the UK in the past decade, companies such as Asos, King.com, Lovefilm, Just Eat, Zoopla and Graze. Many of these are fast becoming international brands and significant global players.
Klein suggests that this is a successful bandwagon that Britain’s leading companies should jump on — a process that begins by getting digital and technical executives into jobs at the top of their businesses.
“Here’s a question for the CEO summit,” he suggests. “This is the biggest economic story of the 21st century. Start-ups in Stockport, in Cambridge, in London’s tech city get it. Even the Government gets it. So what’s going on?”