IT heads think Brexit has already damaged the reputation of the London tech sector.
One in three tech firms say international hires have fallen through because of the Brexit result, according to a survey from industry body Tech London Advocates.
More than half (55%) of tech founders felt the biggest threat to their sector is Brexit’s impact on access to talent. As a result, almost two-thirds (61%) of London’s tech entrepreneurs believe Brexit has already damaged the international reputation of the city’s tech sector.
In light of the results, Russ Shaw, who founded the private sector group in 2013, said, “Slowing down access to European talent will make growing a tech company harder, but London is focused on strengthening its relationship with tech hubs across Europe and around the world.”
Nevertheless, Mr Shaw characterised the sentiment of London’s tech sector as “one of determination, conviction and ambition.”
On the other hand, a report from London & Partners found the UK tech sector gained record-breaking venture capital investment after the Brexit vote, despite swirling concerns. In the period January to June 2017, London tech attracted £1.1bn in venture capital investments – four times greater than figures for the same period in 2013. London currently brings in more than double the amount of investment of any other European city.
UK fintech boomed after the Brexit result, raising more than twice the amount of investment in quarter one to three in 2017 compared with 2016.
Tech London Advocates also found 60% of British tech entrepreneurs believe London is still the best place in Europe to start and scale a tech company. The capital’s tech community believe future investment will come from North America (32%) and East Asia (25%) as opposed to (14%). These international markets are driving substantial deals, including SoftBank’s recent $502 million investment in Improbable and $31.4 billion acquisition of ARM Holdings.
The results are based on a survey of 113 out of Tech London Advocates 5,400 members between October and November 2017.