- British entrepreneurs and investors in Silicon Valley are watching Brexit unfold back home with shock and horror.
- Business Insider spoke to UK techies in the US about their thoughts on Britain leaving the European Union.
- There were widespread concerns it would make it harder for British firms to attract talent and make the country a less attractive place to work.
- Brexit is now just weeks away, and will finally happen on March 29, 2019 — unless it’s delayed.
Brexit is right around the corner — and people are starting to freak out.
The tech industry has asked for more clarity over the form of Britain’s exit of the European Union for the past two years. But now, with just two months to go, there’s still no clear answer over how it will look, and that uncertainty is starting to impact decision-making.
Business Insider spoke to British entrepreneurs and investors in Silicon Valley about how they view Brexit, and if it’s affecting their business — and the response was one of overwhelming fear and sadness.
Their answers provide a window into how some expat Brits, divorced from day-to-day life back in the UK, are reacting to the political turmoil roiling their homeland.
"The downside case is obviously that the UK becomes a lowly, irrelevant island in the North Sea, with very limited relationships and limited asset, and there’s an enormous brain drain … into countries where they have great, stronger trade agreements, and stronger future prospects," said Pete Flint, the cofounder of Trulia who now works as a venture capital investor at NFX.
It’s little surprise that Silicon Valley is concerned about Brexit.
The American tech industry is famously liberal. Back in the UK, one poll of the tech sector prior to the referendum found that almost 90% of respondents were pro-Remain. It threatens to damage a range of industry interests, from the availability of international talent to access to funding, respondents said.
Some techies expressed concern on a personal level about what’s going on.
"I’m horrified," Josh Browder, the founder of legal startup DoNotPay, who has been in the US for four years, said bluntly. "I think if there was a hard Brexit … incomes would go down, prices would go up, and it would be a lower quality of life for people like my mother who lives in north-west London."
Nicky Goulimis, cofounder and COO of Nova Credit, an international credit bureau, compared it to a Shakespearean tragedy.
"I guess I’m fairly heartbroken by what’s going on, independent of any rational perspective," she said. "My family’s from Greece, I grew up in London, and I think just seeing the uncertainty, and the EU is such a force for good in the UK as well as in the entirety of Europe."
Uncertainty causes caution
The uncertainty is already impacting business decisions, some say.
Andy McLoughlin, a cofounder of Huddle who now works as an investor for Uncork Capital, said: "We do have a bunch of British entrepreneurs in the portfolio and would absolutely consider looking at UK businesses in the future but until we understand what how this all plays out, I can’t see us doing anything."
McLoughlin is also co-chair of GBx, an exclusive group of entrepreneurs, investors, and other assorted techies in Silicon Valley. Of the group, he added: "There are a few [members of GBx] who have some operations in the UK and are wondering whether it will make sense to keep teams and their non-US center of gravity in the country."
NFX’s Flint also said it was making his investment firm more "cautious."
"As investors, we’re primarily focused on the US market. I think we are more nervous about investing in EU or UK businesses … as a result of Brexit. Brexit is probably anticipated to be a big negative on the UK economy, and a slight negative on the European economy," he said. "It’s made us increasingly cautious."
It’ll make access to talent far harder for startups in the UK, Browder said — though he predicts it could stand to benefit him and DoNotPay personally if it creates more immigration and bureaucratic hoops for people to jump through. "But that’s a conflict of interest, as a person I think it’s really bad for the country," he added.
London "has this history of reinventing itself"
Others argue there’s less cause for pessimism.
London & Partners, a non-profit organisation backed by the mayor of London, points to significant investments from tech giants like Google, Facebook, and Apple in London since the 2016 referendum, as well as smaller expansions and investments from Silicon Valley startups like shoe firm Allbirds, Credit Karma, and analytics service Mix Panel.
"We see London very much as this thriving global magnet, that is this centre of global energy," said Penny Hardwood, the organisation’s SVP of business development. "It’s incredibly dynamic, over the last 2,000 years it has this history of reinventing itself."
Fundamentally, there’s still a vast amount of uncertainty and unknowns: Will the UK crash out of the EU without a deal on March 29, 2019. Will the negotiations be extended? Will the ultimate agreement be favourable to the UK economy? Might there be a second referendum? How would it even turn out?
For now, more than two years into the process, the answers still aren’t clear, and Britain is fast approaching the brink. Brexit may ultimately prove the doubters wrong, but for Brits in the Bay Area at present, the future back home looks gloomy.
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Source: Business Insider