29 July, 2013 - 11:22 By Tony Quested

Cambridge creating Billionaires Row

It’s hardly in the realms of the Asters and Vanderbilts but business executives in Cambridge are gradually steering the UK’s science and technology cluster into its own Gilded Age with more and more companies set to walk down Billionaire’s Row.

 The 2020 Cambridge landscape will be dominated by luxury maisonettes rather than the ‘summer cottage’ mansions that were the hallmark of New England’s megarich business barons – but in context the change is nonetheless transformational.

Judges of the MacRobert Award so prized in engineering felt that RealVNC would be Cambridge’s next billion dollar technology company. But there is a much higher benchmark to which Cambridge companies should aspire – a multi-billion market cap.

This is why AstraZeneca’s decision to relocate its corporate headquarters to Cambridge is so important; not just because of the 2,000 jobs that come with it – or the research collaborations that will follow.

AstraZeneca’s arrival in the cluster will, at a stroke, more than double the market cap of all the current top 20 Cambridge businesses combined (£41.32bn for AZ, £19.8bn for the ‘Rest of Quoted Cambridge’).

The figure will vary daily, sometimes hourly, as markets ebb and flow but at a median point taken before the UK stockmarket closed last Friday, AstraZeneca’s market cap (quoting GBP) of £41.32 billion was more than triple that of the nearest competitor ARM (£11.96bn) and seven times higher than Johnson Matthey (£5.7bn).

The gap then yawns before the likes of AVEVA and CSR weigh in at a respective £1.6bn and £1.07bn. Domino Printing and Abcam were hovering just under the £1bn mark.

In the development of a cluster with global ambitions this overnight hike in market cap is significant. It demonstrates scale and therefore puts down a marker in corporate terms, not just in science & technology credibility.

The UK government is convinced that it will lead to other corporate giants relocating to Cambridge. Behind-scenes moves to attract more big hitters are ongoing at the highest government level and could bring a spectacular result come the autumn.

There are a number of elements vital to these decisions falling Cambridge’s way but by far the most important is establishing credibility as a place where corporates can thrive. This often has as much to do with infrastructure, lifestyle and availability of new recruits as with tax deals or other incentives.

Where once any US company moving into the UK automatically looked at Thames Valley or the London hinterland for its HQ and to Cambridge for a research hub, the pendulum is swinging.

News today from KPMG that more London companies than ever are looking to expand – but plan to do so outside of the capital, chiefly because of cost issues – drops another huge hint to the mandarins at Westminster.

Say goodbye to the ‘Silly Con’ Roundabout. Say hello to the silicon highway as Cambridge adds balance sheet brawn to its brainpower.

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