As announced in the Autumn Statement, the Government will put £400 million into stimulating UK tech growth.
Commenting on the announcement in the Autumn Statement that the Government will encourage private investment with £400 million from the British Business Bank to unlock £1 billion of new investment in innovative firms planning to scale up, Patrick Imbach, co-head of KPMG’s Tech Growth practice, said:
“This announcement was a timely acknowledgment that our long-term investment culture in the UK, as far as tech start-ups are concerned at least, is lagging behind the likes of the US and China.
“Do we think it’s a game-changer? No, we don’t. The reality is £400m is a drop in the ocean when you look at historic levels of investment into the UK start-up community. Indeed, our own recent Venture Capital Insights survey highlighted a total of $4,336 million of investment by VCs in UK businesses over the last four quarters.
“Will it make UK entrepreneurs sell-out later? Again, I’m afraid the answer is no. £400 million on its own will not be sufficient to bridge any later-stage funding gap and does not address other reasons for companies not going all the way in the UK, such as the lack of experienced entrepreneurs with a proven track record of scaling businesses beyond the early growth stages.
“That said, it was a nice gesture in uncertain times, and does have the potential to unlock further private investment needed to grow the next generation of world-class technology firms in the UK. Additionally, it could go some way to plugging the potential gap that is created by the question mark hanging over UK firms’ access to the European Investment Fund.”
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Katy Broomhead, KPMG Corporate Communications
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