Posted on November 7, 2016 by staff

Tech sector staying positive amid hard Brexit headlines


The question of hard versus soft Brexit is barely out of the headlines at the moment.

At its basic level, the European Union will insist on free movement of people if the UK is to remain in the single market when it leaves.

But a lot of voters voted to Brexit on the basis that they wanted to restrict the number of people able to come to live in this country.

A soft Brexit would give tech firms easier access to international talent – and there are concerns that a harder exit from the EU would harm the tech and digital sector.

“Free movement of people is at the top of people’s minds,” Rory Stirling, partner and co-founder of BGF Ventures, the UK’s largest fund dedicated to backing early stage technology companies, told BusinessCloud.

“A large chunk of the venture capital industry as it stands today has raised money from the European Investment Fund (EIF).

“Our relationship with the EIF outside Europe is unknown at the moment. The question is how attractive will the UK be to invest in and a lot depends on the general economic landscape and the deal that is struck.

“One thing we have got going for us as an industry is that we are vocal and opinionated and we recognise that innovation is a really important part of the economy.

“Let’s focus on the type of talent this industry needs; highly trained, highly skilled engineering talent and leadership. Let’s find a way for the UK to be able to attract that kind of talent.

“The UK has got the opportunity, even outside Europe, and if we get it right this could be an amazing place for really highly-qualified and talented people to come to live and work.”

The UK economy has grown by 0.5 per cent since the Brexit vote – thanks to technology.

But Carlos Espinal, partner at Shoreditch-based early stage investment fund Seedcamp, also has concerns.

Speaking to BusinessCloud before the recent news on the economy, he said: “We are continuing our pace of investment and remain committed to investing in the fastest-growing and most ambitious founders.

“Concerns range from immigration and the freedom of movement of the labour force; to what kind of trade deals and tariffs will be in place long-term as part of a negotiated post-Brexit deal.”

Amid all this, however, he remains positive about Britain’s prospects.

“Through organisations and initiatives such as Tech City, the UK has done an amazing job of incentivising investment by spearheading immigration and tax innovations, to name a few,” he added.

“I think these innovations will continue to attract founders and investment in the near and long-term.”