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Britain sprouts its own Silicon Valley

Cambridge, a township of 100,000 people and the home of one of England's oldest universities, has become this country's version of California's Silicon Valley.

Over the last five years some 200 high-technology enterprises have sprung up, in addition to 50 older technology companies, to produce products in several categories - computer hardware and software, lasers, instrumentation, biotechnology, and general engineering.

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The growth rate of the past few years is continuing, according to Walter Herriot, a Cambridge bank manager. Each week sees the formation of two new high-technology companies, he estimates.

An underlying reason for the success of the area is the large output of technically skilled people from the university.

''What we have in Cambridge is a snowball effect,'' says Richard Cutting of the computer firm Sinclair Research, which has its base here. ''The more people who start businesses, the greater are the numbers of others who recognize that they may be able to do something similar themselves. This helps to overcome the inertial barrier that often prevents people from starting their own firms.''

John Chalmers, who established a two-man company, Independent Product Engineering, last spring, emphasizes the point. ''I've been in the city ever since I was at college. The fact that so many of my friends have started companies has encouraged me to do the same.''

Another impetus to the growth of high-tech here has been the computer club established in 1978 by Barclays, one of Britain's big banks. According to Mr. Herriot, who is the club's first secretary, Barclays decided it was missing out on business by ignoring the special problems of small high-technology firms and founded the club to do something about it.

Many of Cambridge's most successful firms have emerged from the club, including Sinclair Research and Acorn Computers, which started fewer than six years ago and whose combined annual sales now amount to some (STR)100 million ($ 150 million).

A third reason behind the growth is simply that Cambridge, like the San Francisco Bay Area, is a pleasant place. There are plenty of bookshops, restaurants, and medieval architecture to enjoy. ''A lot of people arrive in Cambridge to go to university and find they don't want to leave,'' says Ed Hoskins, who did just that. He founded a company called Applied Research of Cambridge, which specializes in providing computer-aided design software for the construction and engineering industries.

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Another well-established firm is Cambridge Consultants, started by footloose graduates of the university in 1960. The ambition of the company, which is now owned by US consulting firm Arthur D. Little, was to bring advanced technology to bear on the problems of British industry. About 20 new firms have since spun off from Cambridge Consultants. Another fixture in Cambridge is the Computer-aided Design Center, established as a government research laboratory in 1969. Much of the technology used at the center came from the computer labs of Cambridge University.

The prize for the Cambridge entrepreneur with the most interesting background in the field must go to Barry Muncaster, who started working life as a telecommunications engineer with the British post office. Later Muncaster was the chief engineer for a firm called Laser-Scan. Since then Muncaster has formed , in rapid succession, an electronics research and development consultancy, an enterprise that makes taxi meters, a computer company called Tangerine, and now Oric Products, which makes the Oric personal computer. In a little over a year, Oric Products has sold 110,000 computers and has set up subsidiaries in Japan and Singapore. Says Muncaster: ''Each of us has a skill, and mine is making the most of opportunities in new technologies.''

It is a skill he shares with many people here in the high-tech world of Cambridge.

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