The commercialization of technology businesses is a critical aspect of economic growth and innovation. However, according to Warren East, former CEO of British chip design firm Arm, the UK is facing challenges in successfully commercializing technology businesses on a global scale. In a keynote speech at Cambridge Tech Week, East highlighted the need for a mindset shift within the investor community to address these challenges and compete effectively on the world stage.
One of the key issues identified by East is the lackluster growth and poor rates of GDP per head in the UK, which he describes as a source of national embarrassment. He pointed out that while the UK has a lot to offer in terms of innovative technology, firms that achieve scale often tend to change locations or list abroad in countries like the US due to difficulties in achieving global relevance from the UK. This trend results in a loss of potential global businesses that could have been nurtured within the country.
East highlighted the unfortunate reality of a common story where innovative technology created in the UK is exported and commercialized elsewhere around the world. He emphasized the need for the UK to develop a better system for commercialization to prevent the loss of valuable intellectual property and economic potential. While there is a wealth of innovation in the UK, the challenge lies in retaining and growing these businesses within the country.
To address the issue of limited commercialization and global scale-up of technology businesses in the UK, East proposed the need for more risk appetite within the investor community. He noted that the US has deeper pools of capital and higher investor risk appetite compared to the UK, which hinders the growth of high-growth tech firms in the country. East suggested that encouraging more risk-taking and investment in startups is crucial to fostering a thriving technology ecosystem in the UK.
East mentioned the importance of policy changes and investment environment in supporting the growth of technology businesses. He highlighted the need for capital market rules that allow more investments from pension funds into startups, as well as stimulate risk appetite among investors in the UK. While there have been efforts within the British entrepreneurial community and VCs to push for these changes, East emphasized the urgency for businesses to take proactive steps rather than wait for regulatory changes to occur.
The challenges facing the commercialization of technology businesses in the UK require a concerted effort from the investor community, policymakers, and businesses to drive innovation and growth. By fostering a culture of risk-taking, encouraging investment in startups, and retaining intellectual property within the country, the UK can position itself as a global leader in technology commercialization. While there are obstacles to overcome, the opportunities for growth and success in the technology sector remain promising for the UK.