One in five startups is planning to set up in another county in Europe because of Brexit, but the majority intend to keep their headquarters in the UK, new figures reveal.
Just one per cent of the startups surveyed by Silicon Valley Bank said they will move their HQ to somewhere else in Europe, and five per cent to somewhere outside both the UK and Europe.
A further 11 per cent said they are mulling over whether to relocate or not, while 21 per cent said they would set up an outpost in Europe but keep their headquarters in the UK.
The majority however – 62 per cent – are not considering setting up even a base outside the UK, allaying some concern in the tech industry that Brexit would cause a large exodus of startups.
Several countries, including Ireland, Germany and France, are increasing their efforts to attract innovative tech companies as the UK’s Brexit plans become clearer.
“The Brexit findings in our survey this year are compelling and we are pleased to bring some data to a conversation that has been largely anecdotal,” said SVB UK branch president and head of Europe, Middle East and Africa, Phil Cox.
“While 21 per cent of innovators say they will be opening European outposts, the majority will continue to back Britain as the home for their headquarters.”
Snapchat parent company Snap, which is soon to go public in a multi-billion dollar IPO, gave post-Brexit Britain a boost at the start of the year when it announced plans to open its international headquarters in London.
The bank’s Startup Outlook 2017 report which gauges the sentiment of startups for the year ahead found confidence has fallen 10 percentage points from the same time last year to 48 per cent and four in five pegged the fundraising environment as “somewhat or extremely challenging”. But, 89 per cent plan to grow their workforce and that compares to 79 per cent of entrepreneurs in the US who said the same.
“Businesses are seeing more opportunity than fear, which can only be a good thing,” said Cox.
“Though startups are feeling less optimistic about 2017 than they were about 2016, even more are looking to grow their workforce this year. Not without challenges, but the British technology industry is not slowing down.”
An earlier survey of entrepreneurs indicated their outlook for the year ahead had picked up since the immediate aftermath of the EU referendum in which the majority of the tech industry supported remain.
André Beukes is an EU Management Consultant to international companies doing business in Europe. He provides clients with practical business support that makes a real difference doing business in the EU. “Put simply, I am here to help you meet your challenges. I believe in the importance of doing things correctly, meaning risks are reduced and problems are avoided.”