Barrie Hensby column.

Byline: By Barrie Hensby

Forty years ago, Cambridge and its environs were little more than a graceful backwater.

It obviously had a world-class university, but, that aside, the area was relatively inward-looking and unexciting, and was famous for little more than its scholars, rowers and rolling miles of flat fenland.

Today, it's a radically different story. Cambridge has been transformed into a major regional centre, boasting the full range of business and consumer service activities, a rapidly-expanding population, a vastly improved (if rather congested) transport infrastructure and a worldwide reputation for its thriving hi-tech business sector.

This evolution and its outcomes have been analysed and named as the 'Cambridge Phenomenon' ( and my view is that the North-East, with its increasingly well-regarded universities and hi-tech sector, could learn many lessons.

The Cambridge Phenomenon research, conducted by analysts SQW, showed the 'myriad interconnections' between tech firms and universities.

Many of the hi-tech firms in and around Cambridge work as an active 'cluster.' A mixture of established and new spin-out firms drove and benefited from this cluster's business success, with the quality of start-up companies improving.

This success story did not go unnoticed by the professional services community and major legal, property, financial and venture capital firms established themselves in the area.

So what has all this got to do with us? Well, the North-East has many of the raw ingredients to hand which combined to create the Cambridge success story ( innovative research teams at thriving universities, a raft of well-established and successful technology firms, strengthening business networks and a newly-growing population.

Making the most of these ingredients, I believe, could be the key to our sustained economic success.

We're doing pretty well so far, but we're perhaps still a little short in some areas, especially within the professional services community.

This is especially true in my own field of venture capital, with the leadership gap left by the closure of 3i's North-East office and others being only partially-filled by firms like NEL and by 'business angels.'

Cambridge's success didn't happen overnight, and they experienced problems along the way ( the North-East has the same kind of raw material available, and may go through the same growing pains, but with the support of the right kind of individuals and firms, I can see no reason why we can't follow their lead to economic success.

Barrie Hensby is chief executive of Newcastle-based venture capital firm NEL