TechCube: how to hack an incubator

Summerhall squats on the eastern edge of Edinburgh’s Meadows park, a tangled mish-mash of beautiful Victorian architecture and bland, grey mid-century extensions, including a thoroughly unremarkable tower block which vies with the University of Edinburgh’s nearby Appleton Tower to be the ugliest building in sight.

It is within this uninspiring eight-storey hive of steel and concrete that TechCube, an incubator-in-incubation which seeks to become a new hub for Edinburgh’s rapidly-expanding startup scene, is rapidly taking shape. But TechCube isn’t another startup factory led by veteran venture capitalists or incubation experts – rather, it’s a grand experiment in what happens when startup entrepreneurs hack together an incubator.

TechCube’s origin myth is a tale of opportunism. For many years the home of the university’s veterinary school, the complex on whose fringes the Cube looms was mothballed and sold off with a multi-million pound price-tag last year. Doomsayers in the local community prophesied that Summerhall would share the fate of the nearby Royal Infirmary, and undergo a crude transformation into high-end flats.

But then the new owner, Robert McDowell, threw the entire city a curve-ball, announcing that the site would instead be transformed into Europe’s second largest arts campus, in what was seen as a full-throated riposte to a perceived stagnation of culture in Edinburgh in recent years. But while the quirky warren of labs, dissection rooms and lecture theatres in the main complex slotted neatly into this vision, the utilitarian tower block presented a quandary.

Enter Olly Treadway, a boyish 42-year-old entrepreneur who had relocated to Edinburgh from his native London two years previously to launch his secretive startup, Sphere. (Treadway is notoriously tight-lipped about what Sphere does, exactly, but when pressed he’s often heard to promise breezily that it’s going to “change the web”.) For Treadway, the building represented an opportunity. A designer by trade, he saw something that ugly concrete cube: a potential solution to the frustratingly disparate nature of Edinburgh’s startup scene. While the university’s well-regarded School of Informatics operates an incubator in Appleton Tower, space is limited and most of Edinburgh’s tech companies are to be found huddled in serviced office buildings scattered around the city.

One evening in September 2011, after a chance meeting with university incubation evangelist Michael Clouser, Treadway texted McDowell from the monthly TechMeetUp event at Appleton Tower. “Are you interested in your tower being a serious tech hub, incubator, startup machine for Edinburgh?” he asked.

The reply came quickly, and pithily. “Yes.”

Everything moved quickly after that. Within weeks, Clouser was in Silicon Valley preaching the gospel of TechCube to contacts from his days as a VC there, while Treadway was mulling where to start with the long road to converting a dour lab building into a hip new home for the capital’s technorati.

Four months later, with the TechCube renovation less than two months from its scheduled completion date, Treadway comes across as both ebullient and completely exhausted. He speaks in stream-of-consciousness soliloquies; rapid-fire exhortations of the progress TechCube has made, and the great things it hopes to achieve.

TechCube as Treadway envisions it is a magnet for talent, ideas and, most importantly, money. As he sees it, Edinburgh is a city full of bright people doing interesting things, but without the necessary investment capital to support them — especially at the crucial early stages. “There’s world-class life sciences and robotics and machine-learning, AI stuff happening in Edinburgh,” he observes. “Those people want money, and the money’s not here. Or at least, it’s not accessible, and so what happens is they shoot off to California and other places around the world because they want to be taken seriously.”

Therein lies the niche he wants to fill with TechCube. “The tech scene is about to explode. The business of trade, and social, and film, and retail and all these things are going to be driven by and accessed via the internet,” says Treadway, excitedly. “You’re going to need businesses to build that future, and a lot of that’s happening in America.

“But startups in Europe and the rest of the world find it very difficult to get the early money — the seed money, which is much more important that the stuff when you’ve got traction; the VC money. So the idea of the incubator is to deal with that.”

But if Treadway views Edinburgh as a dry commercial well right now, he seems fascinated by its potential as a backdrop for innovation. “Edinburgh is a stunning space,” he says. “It’s inspirational — topographically, visually.”

And in more practical terms, “because Amazon and IBM and others are actually here, and there are a whole bunch of world-class university bods, I think there the ingredients — even if it’s touch and go — to maybe, potentially have a presence in the world that is taken seriously for its ability to get web businesses up and running.”

His immediate mission, he says, is “to put something right in the heart of the city, that gets that whole community together.”

TechCube’s path to this point, from SMS inception to almost-completion, can be likened in some ways to Facebook’s development philosophy: ‘move fast and break things’. In fact, in the early days, that inspiration took on physical form, as a swarm of entrepreneurs, geek allies and tech-sector affiliates descended on the site to help demolish seven labyrinthine floors of labs and academic offices.

It was crowd-sourced carnage, and a clever buzz-building strategy. Every weekend from mid-February to the end of April, dozens of the capital’s technology professionals put down their iPads, picked up sledgehammers, and adjourned to the pub at the eight hours later caked in dust and relishing a rare sense of accomplishment which can be derived only from hard manual labour. Meanwhile, the tower shed its fixtures and fittings without the need for expensive demolition contractors — Treadway estimates they saved over £25,000 — and the project’s founders got the opportunity to woo the startups and preach stentorian their vision for TechCube.

But more importantly, the rip-out weekends started to nurture the sense of a TechCube community that is central to Treadway’s vision for the incubator. The moment startups took up tools at TechCube, they started to feel that they were personally invested in the project — not financially, but morally. Suddenly, dozens of companies had skin in the game: this wasn’t just another ‘coming soon’ redevelopment where they might consider moving their operations at some point. Instead, it was something that the community was coming together to build; an idea that played to their sense of agility and ambition, and which promised great things.

But Treadway’s plan extends far beyond just a nicely done-up building full of startups. Cheap office space for interesting, innovative companies is just phase one. Ultimately, Treadway wants TechCube not only to act as a lightning rod for investors, but to develop its own in-house ventures fund, currently codenamed ‘StockCube’. Moreover, he doesn’t see the incubator as a one-off. In five years time, if all goes to plan, he says, TechCube “has a really strong fund, there are two or three TechCubes around the world… and it’s really leading the way, and it’ll have success stories coming out of it, one after the other.”

The founders’ near-pathological obsession with agility and scalability — the art of doing big things fast — plays neatly into the industry’s mindset. The TechCube experiment, with its DIY ethic and stellar ambitions, seems to have arrived at the right time. In some ways, the community which is increasingly rallying around TechCube could be seen as part of a wider rebellion of the Scottish technology industry against the received wisdom that startups north of the border quickly outgrow Scotland, and are left with few options but to decamp to London or the Valley.

This insurgency is backed by the Scottish Government, which under SNP first minister Alex Salmond has been doggedly determined to grow Scotland’s high-tech sector, and fuelled by an ever-increasing stream of top-quality tech talent from Scotland’s prestigious research universities.

One prominent figure in the Scottish technology sector notes that the web sector “presents a unique set of challenges. Capital investment costs are minimal in comparison to the old factory model of innovation. Startups can scale far more rapidly than in any other industry, moving from tens to millions of users in tiny timeframes. Ideas can be rapidly deployed and failure is far less destructive than in other business sectors.”

The TechCube model could work because it is “driven by the passion and entrepreneurial flair of tech developers themselves. The groundswell of support and goodwill from across the Scottish tech sector has been impressive.”

And Coleman isn’t alone: Gareth Williams, CEO of flight comparison site Skyscanner — now widely regarded as one of Scotland’s pre-eminent tech companies — has also been an outspoken supporter of the TechCube vision, calling it “perfectly-timed.”

“Skyscanner started in the embers of the dotcom bust,” he says. “We felt isolated and it’s taken us a long time to achieve our modest success. However, by creating and adding to a network of co-located business with shared lessons, energy and ideas, this process can be accelerated and lead to a positive feedback loop where success breeds more success.

“Several really good companies in Edinburgh five years ago failed to become all that they could have in impact, jobs and contribution… TechCube has a great chance of being a big part of not repeating those mistakes.”

Early successes have buoyed TechCube evangelists’ hopes for the incubator, and for Edinburgh’s place as a viable centre for the global tech industry. In late June, Treadway closed a deal to bring the Edinburgh-based development hub of American fantasy sports giant FanDuel to TechCube. And in mid-July, after less than six months in business, Edinburgh startup ShopForCloud were acquired by Californian cloud computing firm RightScale for an undisclosed sum. The previous month, as they were finalising the RightScale deal, the startup had moved into TechCube, and are now, in their new incarnation as a semi-autonomous product unit within their new parent company, set to remain as tenants.

The twenty-something founders of the newly-rebranded PlanForCloud, brothers Ali and Hassan Khajeh-Hosseini, seem to have bought into Treadway’s vision of a community of geeks coming together to do something awesome. Other Edinburgh office spaces they viewed, says product and marketing manager Hassan, “are just people in suits walking around, and everyone’s kind of isolated.”

Ali, a Ph.D candidate at the University of St Andrews and PlanForCloud’s technical lead, elaborates: “Even though we’re now part of this big RightScale team, and they have over 200 employees, they’re trying very hard to keep that startup culture, because that’s what keeps it exciting and fun… it’s better for the whole company if you do that.

“We essentially thought, when we were making our decision, ‘if we’re at TechCube, it’s going to be very easy for us to grow that culture, because everyone’s doing similar things, everyone wants similar things.’”

But for Treadway, the TechCube formula is an even simpler equation: “Young, vibrant people with good ideas enjoy being together, and that creates interest, and that’ll be the start of things to come.”

Image courtesy of David Selby