I spoke to an investor recently who is extremely bullish on the UK. Here is his refreshing view on the future of the UK startup scene: 1) He thinks we’re primed and that the challenges of the last 5-6 years are in the past 2) A lot of Europe is still to fully recover from these issues and the UK is now a really good place to invest 3) He compared now to the period between 2010-2015 when a lot of great companies were built and thinks the next 5 years will be very similar. We’re often so negative in the country and think the grass is greener elsewhere (it rarely is). Hearing this is extremely exciting for us and affirms everything we think at Founder and Lightning. Compared to the doom and gloom, this is the attitude we need ! Investors/Founders, what do you think? Do you agree/disagree? ----- If you liked this post, I also have a newsletter where I speak about topics like this in more depth. You can subscribe in the comments below. Thanks ! #investment #ukstartups #ukbusiness
We have been active in the UK market for several years now. The founders we work with found it more challenging to raise money than, let's say, 5 years ago. It's not impossible, though: network and track records matter. Everything is slower than it used to be, according to them.
The only way to stay sane while investing is to believe that the next 5 years will be better.
This is certainly reassuring to hear. And also exciting if the UK has a flourish of new and exciting startups.
I think there are a lot of positives about the scene at the moment that he has highlighted. I think the big negative is the war for talent. Brexit has made it much harder to attract the best people and that will hamstring us until we can fix it
I'm hearing a fair bit of optimism. With inflation coming down, interest rate cut on the horizon, consumer confidence on the up. It could be a good time.
Any specific niches?.. I believe fintech, legaltech, etc
I'd very much debate "challenges of the last 5-6 years are in the past". H2 '20 to H1 '22 was the best time in the UK for equity funding full stop. The best quarter ever was just 2 years ago. What problem has spanned the last 5 years? 🤔 I'm all for being glass half full, but I see no evidence (UK / global / US) that we've turned the corner quite yet and I've provided information to the contrary from my post a day or two ago: There is lots of talk about ‘green shoot’s in the startup space, but the stats being released last week don’t speak to this. 📉 Carta data from the US showing that down rounds in Q1 hit 23%, a Carta record. Also reporting that Q1 had a higher share of deals with liquidation preference over 1x than any quarter in the last 5 years. ⬇️ Morgan Stanley and PitchBook data show that the number of venture firms has halved in two years and ‘dry power’ globally is back to 2019 levels. ➡️ Beauhurst Q1 24 figures look flat, at best and back to 2018 levels.
I love his optimism but doesn't feel in line with the reality on the ground. Hoping a new government can help UK become a serious place again but hard to see how the past 8 years have made this place in any way attractive for investors
I agree and that is why we as a country got most investment last year in Europe. We have a great innovative culture and it should be celebrated and promoted. If only our politicians had this "get go and do attitude" and inspire confidence
Investing in and building tech companies, and digitising offline businesses | Founder & CEO @ Founder + Lightning.
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