Brexit fallout: London To Become Most Business Friendly City?
We’re just a month out from the Brexit referendum. Following a market shock and a Mexican wave of raised eyebrows undulating across the globe, some exciting patterns are starting to surface from the perspective of a tech business aiming for growth. These are still early days, but we think there are reasons to be positive.
Welcoming new business to Britain
Britain is Open for Business. As the dust settles from the explosive result of the EU vote, that’s possibly the only consistent message heard clearly from all sides. The Conservative government have created an entire new department for international trade, and the Labour Mayor of London is campaigning at pace to attract new businesses into the Capital with his #LondonIsOpen campaign.
The new Chancellor, Philip Hammond – on his recent trade-focused trip to China – raised expectations for a cut in corporation tax and even VAT, as a move to encourage businesses into a Britain positioned as throwing off the shackles of trading as a block of countries bound together by European red tape.
If he decided to follow the post-referendum plans of his cautious predecessor in lowering the rates from 20% to 15%, as reported by the BBC that would give the UK the lowest corporation tax of any major economy.
Keeping the business here
So the UK is attracting business. But won’t Europe see Brexit as an opportunity to coax companies across the Channel? Frankly it doesn’t look like it.
We aren’t hearing major political voices in Berlin or Paris reaching out, and as Fortune noted, it’s those same core EU countries that have been leading the crackdown on the big tech firms such as Google over their tax affairs.
London as a centre of gravity for marketing tech
Which brings us to the businesses we partner with – technology firms specialising in marketing and looking to scale. We think the signs are strong.
Technology is at the forefront of the start-up world, and of businesses entering the UK market. Failure rates among start-ups are relatively low for tech businesses, and at the other end of the scale, the UK dominates the market within the European continent. Over 1/3 of Europe’s so-called ‘Unicorns’ (pre-IPO tech firms worth over $1bn) originate in the UK – more than any other country.
And marketing and advertising has long been at home in London as a European and global hub, with both agency and media expertise and infrastructure unrivalled outside of New York, severely unlikely to be overtaken.
On this Venn diagram of two of London’s biggest business strengths for successful incoming businesses, the sweet-spot in the overlap is ad / marketing technology.
So if the UK is about to make a push to attract new business, we’re hopeful we’ll see marketing tech businesses right at the front of the orderly British queue.