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The burgeoning ‘Flat White Economy’ is likely to play a vital role in the future of the post-Brexit UK economy. Now the second largest business sector in the UK, it accounts for 8.7 per cent of GDP.

The term, originally penned to capture the explosion of digital businesses in London’s EC1V postal district, is spreading its caffeine-infused influence northwards, according to new research conducted by the Centre for Economic and Business Research (CEBR) in 2016.

Edinburgh, with its highly educated workforce, booming tech sector, renowned quality of life and unmatched cultural offer, acts as an increasingly powerful magnet on young, talented and creative individuals from across the globe.

A disparate collection of coders, marketing gurus and creatives would appear at first glance to have little in common, barring a predilection for espresso and steamed milk. Yet their mutually complementary skill-sets are delivering disruptive technologies and life hacks that are having a profound impact on the business ecosystem. The CEBR has boldly predicted that by 2025, around one-third of the UK’s output will depend in some way on the digital economy.

More than 6,000 new businesses were incorporated in Edinburgh in 2015, up 19% on the previous year. That figure is reflected in Edinburgh’s emergence as the largest technology cluster outside London in terms of productivity.

It’s a success story that proves that the Flat White Economy, with its multifarious spin-offs – research and development, software development and coding, ecommerce and consultancy, TV and film production, analytics and resource optimisation, online advertising, design and marketing – is thriving in Edinburgh.

The UK’s leading tech incubator

The success and growth of creative communities across the city speaks volumes about the potential of Edinburgh’s digital economy, with its many rising stars. One such example can be found at CodeBase, Edinburgh’s renowned tech incubator and home to more than 60 of the country’s most exciting businesses.

GetCommerce celebrated its fourth birthday in early 2016. They were among the first wave of CodeBase tenants in early 2014. Founded by web developers Andrew Baker and Ross Knight in 2012, the business has established itself as one of Scotland’s preeminent developers of Magento eCommerce websites.

Ross Knight, Founder, GetCommerce:

To grow and stretch ourselves in terms of the types of development we wanted to deliver for our clients, we decided to focus on Magento development as it’s an incredibly powerful, versatile eCommerce platform capable of supporting business from start up to multi million turnovers

“We quickly realised we needed to be in Edinburgh,” adds Andrew. “In order to target the type of client we wanted, and attract the right level of talent, we needed to be city centre-based.”

“CodeBase gives us a real sense of community. In Edinburgh, there’s such a good mix of everything you need for success: an exceptional talent pool from the universities; high profile success stories such as Fanduel, FreeAgent and Skyscanner to create a buzz around the city; and facilities like CodeBase with its creative mix of tenants forging a real ecosystem of innovation,” concludes Andrew.

GetCommerce’s success has been repeated by numerous other technology-led businesses across Edinburgh. Administrate, widely tipped as Scotland’s next tech unicorn, is revolutionising training and development through its cloud-based learning management and online course booking systems. The business has just opened its first overseas office in Bozeman, Montana and looks set to capitalise on a market valued at US$107bn. Then there’s Intelligent Point of Sale – its cloud-based application allows bars, restaurants and clubs to control and track sales and stock in real time. Having achieved sales grow of more than 300% in 2015, and securing more than 1,000 customers – including the UK’s largest festivals operator, Underbelly – it has just been acquired by Swedish mobile payments giant iZettle.

Beneath the surface

Delve beneath the high profile, creamy surface of Edinburgh’s tech scene and you begin to discover a richer, complex aroma to the city’s Flat White Economy. It is here that you uncover the true scale of the digital economy, in particular an incredible diversity of small, independent creative businesses. Many of these are members of Creative Edinburgh, which was formed in 2011 to bring together Edinburgh’s creative entrepreneurs through networking and events.

In 2015, Creative Edinburgh, Festivals Edinburgh and CodeBase collaborated on the launch of Innovate UK’s Digital Media Launchpad – an opportunity for innovative digital media businesses across the city to secure investment of up to £1 million in support of commercialisation.

Janine Matheson, Director, Creative Edinburgh:

I see a creative network and community in Edinburgh, sharing a strong sense of optimism about the future. Creative minds tend to see opportunities and take risks. The boundary between the tech scene and creative scene is increasingly blurred – today’s businesses and individuals are less concerned by failure. You learn from it and move on

For cities such as Edinburgh, with its multi-cultural, global appeal, strong economic track record and vibrant talent pool, the emergence of a creative tech cluster at the heart of a Flat White Economy looks set to continue. That has to be good news for a diverse, forward-looking regional economy and good news for Edinburgh’s many artisan coffee shops.

Find out why Edinburgh is a great place for tech