The TechCrunch Disrupt London Brexit Sentiment Survey — Uncertainty sucks!
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What is going to be the impact of Brexit on UK startups and the wider European tech ecosystem as a whole? TechCrunch wanted to find out.
So, in the last 3 weeks TechCrunch has polled 300 members of the startup community in London and the wider UK, 150 startups and 150 investors. The survey has been sent out three times in the last four weeks asking the same questions weekly, but adding any relevant questions based on developments.
But there’s more.
Next week, during TechCrunch Disrupt London, we will unveil the key recommendations of a panel of UK tech thought leaders to ensure Britain’s ‘Post-Brexit’ tech future, based on our survey. We will unveil their recommendations on 10 major themes and will be aimed at the UK government.
The recommendations will be made by:
Bernard Liautaud, General Partner, Balderton Capital
Brent Hoberman CBE, Founders Forum
Dale Murray CBE, co-founder Omega Logic
Edward Wray, Co-founder of Betfair
Niklas Zennström, CEO and Founding Partner, Atomico
Richard Reed, Co-founder Innocent Drinks / JamJar Investments
Sherry Coutu CBE, Founder, founders4schools
Sonali De Rycker, General Partner, Accel Partners
Below is a summary of our findings from our survey.
Week 1, Oct. 24
Our respondents included people who were on both the Leave and Remain side of the initiative.
At this early point, a few of our Leave respondents expressed voter’s remorse, while others still felt bullish about Brexit’s potential benefits for startups. Several expressed confidence that the City of London and Mayor Sadiq Khan will come through with measures to help the startup community. They were less positive about Prime Minister Theresa May’s government.
20% of founders indicated they had already had employees leave the UK on account of Brexit.
We asked “To preserve a thriving startup community in London, what is the single most important initiative authorities could take?”). Here’s a selection of representative responses:
“Safeguard non-UK employees. We’re a global company, not a parochial one, and we need staff from all over the world.”
“Keeping access to EU talent is the biggest thing and would be a cast iron commitment from the UK government to maintain the 2015 level of LP investment that UK based VC’s receive directly or indirectly (via the BBB) from the European Investment Fund. Without that commitment there will be a massive shortage of VC money in London in 12-18 months time.”
“Stop this immigration and hard Brexit scare mongering.”
Week 2, 31 October
The main headline during this week was that founders and investors have next to no faith in the government’s ideas, expressed at the Conservative Party annual conference
100% of respondents replied that they had NO support for Home Secretary Amber Rudd’s call for businesses to register foreign nationals helpful to their operations.
75%: Felt no better after the Home Secretary withdrew the statement.
80%: Rejected India as a source to make up for post-Brexit gaps in talent.
What do UK founders and investor want? By far the number one concern was a provision in the law permitting EU talent in the UK to remain and providing UK-based founders a way to recruit and bring to the UK talent in the EU.
Some open ended feedback responses to this question: “If so, how do you think we get ‘Brand Britain’ back?”
“By staying in Europe and show unity! -and by educating people of the benefits so that we can establish harmony back in the UK.”
“By stating publicly that Britain welcomes entrepreneurs and wants to continue building on the success.”
“It has been damaged in so many ways. One item, is it needs to build up relationships with other European countries, and make all foreigners to feel welcome in the UK again.”
“Remind the world we are open to people, which is the engine of the otherwise stale notion of just ‘business’. We need to stop our government from taking actions that validate racist and xenophobic sentiment that hurt people and embarrass the country.”
Week 3, 14 November
By this week, sentiment was shifting:
• 8% of respondents over the past two weeks said they were feeling BETTER about the post-Brexit prospects for the London/UK startup scene today vs. one week ago. That week it jumped to 37% “feeling better”
So we asked: “Please describe your level of confidence in Theresa May’s Conservative government ability to protect the startup community from negative impacts of Brexit?”
Two weeks prior to this point, 68% had ‘low to no confidence’ in the government. By Week 3 the numbers expressing ‘low to no confidence’ had risen to 83%.
We asked: “Do you think the U.K. Government should challenge the High Court Ruling on Article 50?” The answer was No: 63%, Yes: 37%.
This clearly reflected the concern over the de-stabilising effects of Brexit negotiations.
Some open ended feedback responses to the above Article 50 question were:
“The Supreme Court will rule the same as the High Court but it’s better to leave no doubt about the law of the land to give the decision as much legitimacy as possible. So the government should challenge it, as this is a democratic society and this will probably make more of the population feel at rest [if the due process of law if followed].”
“A supreme court ruling should cement the role of Parliament in the Brexit process. I am doubtful the government would then refer it to the EU courts.”
Next week we will unveil the recommendations made by our Panel. So grab tickets to Disrupt!
TECHCRUNCH DISRUPT LONDON
The two-day Disrupt conference runs December 5 to 6 in the Olympic Village’s Copper Box Arena and features Startup Alley and Startup Battlefield where one startup will take home £30,000. You can buy early bird tickets for Disrupt London here.
You want to display your company? Then go for a booth in the Startup Alley. For startups there is also the brand new CrunchMatch program where we match startups to investors. Check it all out here.
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