The issue of commercializing technology businesses globally is a significant challenge that the U.K. is currently facing. According to Warren East, former CEO of British chip design firm Arm, there is a need for a mindset shift in the investor community to ensure that the U.K. can compete on the world stage. East highlighted the criticisms surrounding lackluster growth and poor rates of GDP per head in the country, labeling it as a source of national embarrassment. One of the main concerns raised by East is the tendency for firms that achieve scale in Britain to either relocate or list abroad in countries like the U.S. due to difficulties in achieving global relevance from the U.K.
East emphasized the importance of getting commercialization right in the U.K. He pointed out that while there is a lot of innovative technology being developed in the country, much of it is exported elsewhere for commercialization. This scenario leads to a loss of potential economic benefits for the U.K. East suggested that the country needs to encourage more risk appetite to support high-growth tech firms and retain them within its borders. While there is no one-size-fits-all solution to this issue, East believes that increasing investor risk appetite and attracting more investments from pension funds into startups could stimulate growth in the U.K.
There have been efforts within the British entrepreneurial community and venture capital firms to advocate for changes to capital market rules that would facilitate more investments in startups. The goal is to stimulate risk appetite among investors in the U.K. and create a more supportive environment for tech businesses to flourish. East expressed optimism about the prospects for these changes in the coming years, but he also cautioned that businesses cannot solely rely on regulatory changes to drive growth. Companies must be proactive in seeking out investment opportunities and expanding their global footprint.
Last year, Arm, a British chip design firm known for its chip architectures in smartphones, listed on the Nasdaq in the U.S. This move came as a disappointment to U.K. officials and the London Stock Exchange, who had hoped to see more tech debuts in Britain. The decision to list in the U.S. highlights the challenges that tech companies face in achieving global recognition and attracting sufficient investment in the U.K. While Arm remains majority-owned by SoftBank, a Japanese tech giant, the listing on the Nasdaq underscores the need for the U.K. to address its commercialization and investment challenges to retain successful tech companies within its borders.
The U.K. has significant opportunities for global technology business expansion, but it must address the current challenges in commercialization and investor appetite. By fostering a more supportive environment for high-growth tech firms and attracting more investments, the U.K. can position itself as a leading player in the global tech industry. It is crucial for the country to leverage its innovative capabilities and create a conducive ecosystem for tech businesses to thrive and contribute to the national economy.