The UK’s tech industry is in limbo as the UK government continues to offer scant details about what June 2016’s vote to leave the EU will mean for immigration laws. At the TechCrunch Disrupt conference held in London on December 5, investors and entrepreneurs expressed their frustrations over the lack of certainty on Brexit.
“We’re in ‘deer in headlights mode’,” Sonali de Rycker, partner at London-based venture capital firm Accel Partners, told the audience. “We do not have a clue what's happening.” Prime minister Theresa May’s government has refused to reveal any substantive details on its strategy, saying that doing so could weaken its negotiating hand with the EU.
The top concern of conference attendees was access to talent. Brexit poses a dual threat of jeopardising both funding and access to human talent through immigration restrictions. London venture capital firm Balderton Capital said more than 40% of tech companies set up in the city last year had at least one non-British founder.
Hard Brexit fears
Funding is also dependent on the outcome of the Brexit negotiations: a “hard Brexit” could turn international venture capital firms away from investing in UK businesses, leading them to take their money elsewhere.
Six months after the EU referendum, London is still Europe’s premier tech hub. In October, London & Partners reported: “London’s tech companies attracted $425m across 33 deals since the Brexit vote – more than Dublin, Paris and Amsterdam combined.” Google recently reiterated its plans to build a new UK headquarters in London that will create 3000 jobs, and software developer Adobe is building new offices in London to cover Europe, the Middle East and Asia, saying it “did not blink” after the Brexit vote.
Still, the lack of certainty over the future leaves tech investors – especially in the start-up and small business area – in the dark. If the UK does not remain open to the best talent the world has to offer, many investors say it could lose its position as the top destination for start-ups in Europe.