Is the UK too ‘stuffy’ for tech?
In a speech last month, Nadine Dorries, the new minister for digital, culture, media & sport, noted that amongst tech entrepreneurs, the UK can still be seen as a bit “stuffy”.
The minister’s words echo the comments of James Anderson of Baillie Gifford to the FT over the summer. Mr Anderson has been one of the leading investors in the tech sector, but blamed the lack of entrepreneurial spirit in general and support for the fund management world in particular for the UK’s failure to grow giant companies. In his view the issue had led the FTSE being an index for the “19th century and not even a 20th century index” .
Sir James Dyson, one of our best known entrepreneurs has been similarly downbeat on the issue: “UK culture doesn’t celebrate the entrepreneur”.
There is clearly a lot of work to do, but in my view there are causes for optimism.
For one, the government does seem to be trying to move things in the right direction. During the pandemic its Future Fund provided £1bn in funding to early stage start-ups, with an overhaul to the UK Listings rules looking increasingly likely in a move to make the LSE more attractive to tech firms. The Kalifa Review of UK Fintech also put forward a number of sensible proposals for improvement.
The success of early UK tech unicorns like Revolut is helping to grow an ecosystem to support newer firms. In some cases the link is very direct – for instance co-founders of insuretech unicorn Zego met while working at Deliveroo.
We also reportedly had our 100th unicorn in June, with start-ups and scaleups raising a record breaking £13.5bn in the first six months alone, suggesting at least some investors are seeing positives in the UK tech scene.
Culture is still an issue, but for me things are moving the right direction. In my own practice I have found it heartening to see how even some of our ‘old money’ investors have been increasingly interested in angel investment or larger bets on tech companies. For my contemporaries going to work for a tech start-up is also no longer the left-field choice it was not that long ago.
More needs to be done, but for me the UK is remarkably less stuffy in its attitude to tech than it was even five years ago.
Charlie Hewlett is an Associate in the Corporate team at Boodle Hatfield and a member of the firm’s specialist Entrepreneurs Group.