THE Bournemouth area has been named a “hotspot” for the setting-up of new tech businesses.

The number of new firms in the sector rose by eight per cent across the South West last year, research suggests.

There were 578 new software development and programming business incorporated in the region, up from 534 in 2017.

Analysis by audit, tax and consulting firm RSM identified “clusters” around Bournemouth, Bristol, Bath and Exeter as hotspots.

Anthony Story, director of Silicon South – the not-for-profit organisation charged with boosting the area’s digital economy – said: “We have companies who are beginning to so some really interesting things.”

Companies Silicon South has worked with include Kurch, which is developing artificial intelligence to sift computer evidence for overstretched police officers; People Matter, whose software will help flag up when a worker is overwhelmed by work; and Cudo Ventures, which uses spare computing power to mine digital currencies for profit or charity.

Mr Story added: “We’re beginning to see some strong, practical examples. That’s something we can support and help capitalise on for Bournemouth.”

He said the number of tech start-ups was not huge, but added: “I think it’s good and it’s real but there’s room for improvement and that’s what we’re trying to help achieve.”

Andy Brown, portfolio chief financial officer for several tech and digital companies – including Salad, We Are Base and Passenger – said the research rang true. But he added: “Whilst the volume of businesses setting up has increased, the total number of people working in the industry may not have grown by the same volume.

“It could be a reflection on the mix of business sizes evolving; including freelancers and one-man bands incorporating for tax planning/invoicing reasons as much as a reflection that the industry is growing in total. I think the shape is evolving, with a number of contractors, specialists and small teams entering the market.”

Ben Bilsland, technology specialist at RSM in Bristol, said: “Given the current economic uncertainty, it’s fantastic to see that tech start-ups across the South West have continued their upward trajectory. Particular hotspots include the clusters around Bristol, Bath, Bournemouth and Exeter. “These numbers show that entrepreneurs are continuing to innovate and venture capital, private equity and traditional funders are still lining up to commit funds to the right projects.

“Tax incentives such as the Enterprise Investment Scheme, R&D tax credits, video games tax relief and the Patent Box regime are all playing their part in helping to fuel this growth.

“‘The challenge for start-ups, particularly in the tech space is to develop at speed and to scale-up fast. There can be a high rate of failures as projects can often get overtaken by new technological innovations or better resourced competitors.”