Startup founders have many concerns to contend with, from extending runway to attracting customers and getting product-market fit right. But some companies have an extra worry on their minds: securing suitable lab space at a price that won’t make their CFOs tear up.
Climate tech companies with a scientific product to develop and test are battling for lab space in London. Spaces that are affordable, conveniently located and fit for purpose are few and far between.
But an ambitious new project from real estate investment and development company British Land and Australia’s largest superannuation (pension) fund, AustralianSuper is looking to solve that issue — and in doing so, create a burgeoning new climate tech hub in an as-of-yet overlooked area of Central London.
The lab space issue
Early-stage climate tech founders commonly come from one of three starting points, says Dr Gyen Ming Angel, director of venture building at Prosemino: university spinouts, corporate spinouts or building in a garage. In all three cases, scalable lab space quickly becomes a problem.
“If you are at formation stage or pre-seed stage, maybe you've got a few hundred thousand pounds in the bank, maybe a million if you're lucky. And so you're thinking, ‘okay, I've got 12 to 18 months of runway and need to find some lab space,’” Angel says. “There aren’t many offerings in the country that do buy the bench rent — and if they do, you still have all of the challenges of having to put all of your equipment in yourself.”
Prosemino, a venture builder, which invests in and builds up to five climate tech startups every year, is one of the first tenants in British Land’s new lab and office space at The Paper Yard, alongside startups CheMastery and The Engineering & Design Institute London (TEDI).
There aren’t many offerings in the country that do buy the bench rent — and if they do, you still have all of the challenges of having to put all of your equipment in yourself.
Located in Canada Water, The Paper Yard is a purpose-built science and technology building, which has fitted labs and write-up space available to rent now. Prosemino has recently moved into a unit on the ground floor with three startups in its cohort — and is hoping to add a fourth to make the most of the space.
“At The Paper Yard, you can take the space and have it fully serviced by British Land. And for startups joining Prosemino, we also handle the admin essentials that come with running a startup and maintain the necessary equipment — alongside offering investment, support and expertise for company building and product development," says Angel.
“[British Land] helped us design and fit out the entire lab space, so at the same time as negotiating the lease, we were planning the fit out,” he says. “It meant that I signed the lease and the fit out work started — I wasn't the one chasing around benches, for example, or furniture and desks and all the rest of it, they had all of that sorted.”
That eliminates a major bottleneck of the process of finding and setting up a lab space. “If you're a repeat founder, you know how hard that is — and if you're a first time founder, you don't even know where to start,” he adds.
The new Canada Water
In response to the squeeze for space, some startups are moving out of the Golden Triangle of Cambridge, Oxford and London and putting down roots in other areas of the UK — but it’s not an ideal fix, says Angel.
“The rent can be a lot cheaper, but you end up paying for it in fit-out [costs]. It also depends on where the talent is prepared to move to and where the technology and the IP is coming from,” he says.
It's green, and we know we're on the edge of something that's evolving and is new.
The talent pipeline is partly why British Land has focused on this area: there are more people under the age of 35 living within a 45-minute commute of the area than any other major transport hub in the city, says Alex Maclean, head of marketing at Canada Water. It’s also home to TEDI and British Land has struck partnerships with King's College London and University College London to tap into the potential talent pools.
“Crucially, Canada Water will encompass a completely different vibe to Canary Wharf, which is just one stop further on the Jubilee line,” says Maclean.
The Paper Yard is just one small part of British Land and Australian Super’s plans for Canada Water: The area is busy with development, which will soon deliver the first phase of the masterplan in early 2025 — including two office buildings, a new Asif Khan designed boardwalk crossing the rejuvenated Canada Dock, outstanding new food and beverage offers, a new culture hub with event space and a state-of-the-art leisure centre.
The area will eventually host up to two million square feet of modern office space, between 2,000 and 4,000 net-zero homes and up to one million square feet of leisure, retail and F&B — all surrounded by green spaces and tranquil areas of restored docklands.
“Canada Water is London’s newest forming cluster of climate tech businesses. A need-to-know location, if you are looking for R&D space in a budding hub for net-zero tech," says Amy Hockley, head of innovation leasing at British Land. "Our development, set against a backdrop of green and blue open spaces and an exciting mix of bars, restaurants and cultural venues offers a different perspective on Central London, whilst also being two stops from London Bridge and one stop from the Elizabeth Line.”
Alongside the creation of new working spaces and professional venues, British Land is also developing a new town centre to add to the neighbourhood. It’s set to revamp the area’s retail and social scene with new restaurants, shops — and in good news for London Printworks fans — there are plans for its creators, Broadwick live, to return to Canada Water with a new cultural and events venue.
“Though the project is now in full flow, after a decade of preparation, being an early adopter of the space has been an exciting sign of the good things to come,” says Angel.
“It's green, and we know we're on the edge of something that's evolving and is new. So, within the timeframe of our own lease, we know that the space will develop around us and the permanent scientific buildings are going up — we want to be a part of the longer term vision.”
Are you looking for space in London’s new climate tech hub? The Paper Yard has fitted labs and write-up space available, with units ranging from 1,000 - 30,000 sq ft. To find out more, click here.
