What does Brexit mean for the UK’s tech scene?

Can Silicon Roundabout survive?

Keep Calm and Code On

Now that the British have voted to leave the EU, the internet-enabled world won’t be looking to the official Leave campaign website to find out what Brexit will mean – almost its entire website has been wiped in the last day.

Is their website a harbinger for bigger changes in Britain’s tech scene?

Before the vote, 87% of technology industry firms were against leaving, 70% worried it would damage London’s reputation as a technology hub. (And the race to replace London as Europe’s startup capital is already underway.)

Hiring is one major cause for concern. Much like in the US, there aren’t enough job applicants with math and science degrees to fill all those development and engineering positions, with many London startups looking to EU member states to hire. Leaving the EU could add significant barriers.

When they’re not hiring, startups are looking for funding. A Brexit could make that harder as well. Uncertainty may lead investors to delay or forgo investing in UK startups. And funding from the European Investment Fund, which backs 41% of venture capital investments in the EU, could dry up as well.

Data protection is another worry, as the US and EU finalize their latest data privacy agreement. “In order to continue to move data freely between the UK and Europe, the UK will have to prove it offers equivalent levels of protection,” Bloomberg wrote.

Britain also acts as a counterweight against “privacy-heavy countries” like Germany and France. Now the EU balance will shift toward more restrictions on personal data.

Speaking of data, according to Google Trends, searches for “what is the eu” and “what is brexit” began climbing on Thursday, the day of the vote, but only after the polls closed.

Perhaps the best advice for the UK tech sector can be read in a blog post on Atomico’s website, the London-based VC firm was London established by Niklas Zennström, a co-founder of Skype:

“For UK tech, now is not the time to make rash decisions or pack our bags. We have companies to build and customers to serve, regardless of the situation…despite Brexit, we believe that great companies will continue to be founded and significant capital will continue to flow throughout Europe and to the UK. Entrepreneurs are resilient.”

They titled the piece, “Keep calm and code on.”


More Posts