The UK Government has taken promising steps to bolster the creative industries as part of its modern Industrial Strategy. A recent summit unveiled a £60 million package of support for the creative sector, including funding for startup video game studios, grassroots music venues, and British music and film exports. This marks the first phase of a Sector Plan for the creative industries and highlights the sector’s growth potential as a driver of economic transformation.

To fully unlock this potential however, the UK must close its connectivity and compute gap. Having driven £40 million of investment into createch SMEs over the last decade, at Digital Catapult we recognise that failing to address these infrastructure challenges will hinder pioneering startups across the UK. This is particularly the case for AI-first SMEs in the createch space, which rely on robust infrastructure to transition from promise to impact.

The dawn of the AI-first startup

When I refer to an "AI-first startup," I am describing businesses developing deeptech innovations that are rooted in artificial intelligence (AI). These startups have AI embedded in their DNA and are driving advancements in fields as diverse as digital content creation, gaming, film production, and music. They are of immense value to the UK’s industrial landscape, representing an £550 billion opportunity over the next decade.  

In createch, these AI-first startups are reshaping workflows, enabling generative design, and creating more immersive experiences for audiences. The UK Government’s investment in creative businesses coupled with its commitment to regional growth underscores the importance of ensuring these startups can thrive nationwide, particularly given their economic value. Last year, UK startups in AI received 25% of all venture capital funding, marking the second-best year on record for AI investment. 

At Digital Catapult, we enable AI-first startups to scale by providing investment-readiness support, introductions to industry partners, and innovation consultancy. In the createch sector, this means helping startups to leverage AI to reimagine creative processes and to unlock new opportunities for growth, having supported 189 createch startups across various projects and programmes including the Innovate UK BridgeAI Programme. Yet, these efforts are only as effective as the infrastructure that supports them. Access to compute and connectivity is critical for these startups to test, iterate, and refine their solutions, and without it, their potential remains untapped.

Considering access to compute

AI-first startups in createch require significant compute power to train AI models, process vast data sets, and deliver personalised, real-time user experiences. Currently, many of these startups depend on expensive cloud services or compute credits from Big Tech companies, which creates a barrier to both entry and scaling. The UK Government has recognised the importance of addressing this challenge with a £1.5 billion investment in publicly owned cloud compute, known as GB Cloud, which will support UK-based AI startups by providing affordable access to essential infrastructure. Digital Catapult has also delivered innovation and accelerator programmes that have granted AI-first createch companies with compute credits to support their solution, aligning with the UK Government’s Industrial Strategy. 

Combined with funding targeted at creative businesses, this investment and support positions the UK to become a global leader in createch innovation. Compute alone is not enough however, and the ability to experiment, test, and co-create in real-world industrial settings is just as important. This is why access to testbeds and future networks including 5G, 6G and Open RAN are essential for unlocking the full potential of AI-first startups.

Closing the connectivity and compute gap for createch

Connectivity is equally critical for the success of AI-first startups. Many createch innovations, such as virtual production platforms, immersive gaming environments, and real-time music collaboration tools, rely on low-latency data transfer and real-time processing. Without robust connectivity infrastructure, these innovations cannot reach their full potential.  

Testbeds provide a solution, enabling startups to explore and refine their ideas in an independent and commercially neutral environment. Digital Catapult operates eight interconnected, 5G-enabled testbeds across the UK that provide startups with access to cutting-edge connectivity and compute infrastructure. These facilities are particularly valuable for createch startups, allowing them to simulate real-world conditions and bring their innovations to market faster. Consequently, by aligning investments in connectivity and compute with the Government’s Sector Plan for the creative industries, the UK can create an environment where createch startups can thrive. 

Powering a creative and technological revolution

AI-first startups hold immense potential to transform the UK’s industrial and creative landscapes, enhancing the country’s global reputation for creative innovation. Initiatives such as the Soft Power Council, the British Business Bank’s increased support for creative businesses, Digital Catapult’s innovation and accelerator programmes in the creative industries, and the forthcoming Creative Industries Sector Plan underscore the Government’s recognition of this opportunity.

To realise this potential however, the UK must close the compute and connectivity gap. With the right infrastructure in place, AI-first createch startups will be empowered to scale, commercialise their solutions, and drive economic growth across the nation. Moreover, access to independent testbeds allow for qualified and conservative counsel on the strategic benefit of AI, recognising limitations as well as opportunities of the technology, and where alternative solutions might be more suitable to address market challenges. 

By addressing these challenges now, the UK can lay the groundwork for a new generation of startups that will redefine creativity and technology. At Digital Catapult, we have been supporting createch pioneers for a decade, and support this vision, identifying where pioneers could also achieve ‘creative spillover,’ deploying creative deep tech innovation to support other sectors including manufacturing, defence, and energy too.

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