The impending revaluation of London’s commercial property has been making headlines recently, for all the wrong reasons as far as startups are concerned. The Evening Standard’s editorial on 10 October described how the move will have “inevitable, disastrous consequences.” Here is one small example.
Launch22 is a startup that helps other startups start up. We are a registered charity and our mission is to provide free and affordable office space, mentoring and events for early stage entrepreneurs, regardless of their background or means. Our entrepreneurs have gone on to create dozens of jobs and added to the wealth of our society. The unemployed volunteers, whom we train in the many facets of entrepreneurship, almost always go on to obtain well paid, full time employment in some of London’s leading startups, such as Fixflo and GoCardless.
One of the reasons our services have been utilised by hundreds of entrepreneurs over the past two and a half years is because Hackney’s business rates make short term, flexible workspace so expensive. Entrepreneurs already find themselves priced out of this area, and our pricing is very attractive – or indeed free.
Now our rates are going up by 46%. Talk about an inflation busting increase!
Not only is such an increase clearly extortionate profiteering but it comes hot on the heels of Hackney’s refusal to grant us discretionary rates relief, which would reduce our rates bill to zero. This is a relief that is available to any charity but whether you qualify comes down to the magnanimity of the Council to grant it (or not, in our case!).
In stark contrast, Liverpool City Council understands the value of our services to the development of the local start-up ecosystem, and have granted our Centre there full discretionary relief.
So, what does it mean for us? Simply put, we may well go out of business. That means the jobs that we create for our own team will be lost and it means one of London’s vital support networks of mentoring and educational events will be disbanded.
Fewer successful startups means fewer jobs created and a reduction in social mobility. That’s “inevitable and disastrous” for our country.