Editor’s note: This post was republished with permission from the Ewing Marion Kauffman Foundation’s Policy Dialogue blog.
The world was a very different place when Britain was last as “independent” as it will be post-Brexit, making the next chapter in its history all the more unpredictable and interesting. Brexit heralds a new game. And it will not just be the political leaders playing musical chairs.
Entrepreneurs setting out to disrupt the next generation of traditional industries have been dealt a fast-track pass. While the political chaos is settling down with Prime Minister Theresa May putting her cabinet and exit plans in place, older firms less adept at dealing with uncertainty and new rules are now more vulnerable to new competition, and are anxious for a quick resolution and clarity. They need a longer on-ramp to adapt to new games from the new untucked shirts on the block.
While old firms struggle with unknowns, startups thrive on it. Disruptive entrepreneurs already working to reinvent their market by providing a solution that is better, faster and cheaper are already busy figuring out which innovations can now be more easily implemented in a post-EU world.
Much is being written about Brexit this month, but here are two of my optimistic observations.
Number 1: New startup hubs for Europe
As Forbes contributor Philip Salter puts it, “entrepreneurs aren’t a loyal bunch – if the next generation can build a bigger, better business elsewhere, they probably will.” Just as in the United States, we see the rise of new regional centers of innovation and entrepreneurship, so in Europe we are likely to see substantial changes in where the heavyweight startup cities emerge.
National and city governments and startup communities are already working on how to lure people with ideas and talent and make themselves as appealing as possible to those who can still work wherever they choose in Europe. EU countries will benefit from a bigger talent pool.
For example, for sectors like fintech, Ireland has an opportunity to poach some of London’s startups seeking a launch-pad location into the European market. Entrepreneurs won’t wait until the new Prime Minister settles in, develops a timetable for “divorce” negotiations and issues clear new rules. For most startups, that wait would be a lifetime, and their higher tolerance for risk gives them a competitive advantage alongside less nimble established large firms.
“Ireland’s position as one of the last English-speaking countries in the EU could play into the nation’s hands, making it a magnet for tech talent keen to work in the country’s growing tech, biotech and financial services industries”, many thought leaders speculate as reported by Siliconrepublic.com.
Leaders from entrepreneurial ecosystems are rapidly re-organizing. When the world celebrates entrepreneurs during the annual Global Entrepreneurship Week this November, the Irish Prime Minister has announced that Ireland will be putting on a big show for Europe and the world. For example, policy thinkers from across the globe will gather in Cork for the Startup Nations Summit (SNS) to discuss the latest actionable policy steps in front of governments trying to empower their entrepreneurs – including how to map the way forward for a post-Brexit entrepreneurship strategy. Hosting the SNS in Ireland will attract a variety of other efforts that week, including an EU meeting and a gathering of academic researchers in the field aimed at reminding the world that one part of the British Isles anyway is still in the EU and open for business.
Number 2: Global horizons for the UK
My second reason for optimism concerns the UK itself. Startup communities in the UK are very strong and they are supported by many government policies and programs backing the new disrupted industries of the future, particularly the digital economy. For example, through Tech City UK, the David Cameron government supported digital entrepreneurs in London. Expect these and other startup communities to engage in intense and intelligent dialogue in the road ahead as the new government designs a post-Brexit entrepreneurship strategy.
A key part of this concerns the rest of the world. It is understandable that we forget that Britain once had an empire and led the globe in trade. It was a long time ago during another era. However, Britishers have not forgotten they are still part of the 53-nation British Commonwealth – led by the Queen. It is important when we assess the prospects for British entrepreneurs – now less focused on Europe and more focused on the world – that Britain has plenty of cultural affinity, language, experience and history operating as a global power. There are dozens of British entrepreneurs like Sir Richard Branson or Sir James Dyson who know how to scale British brands globally. And Whitehall knows this.
The Parliamentary Snapshot 2015 survey results for example, released exactly a year ago, sought to reveal how Members of Parliament (MPs) perceive entrepreneurship in the UK. The most positive policy direction across the House of Commons was “spending more on improving the skills of the domestic workforce,” which was seen as positive for 90 percent of MPs. The second most popular policy direction was “making it easier for entrepreneurs to move to the UK.” This survey result came somewhat as a surprise to many who had been hearing opposite opinions in government, including those of Prime Minister Theresa May, who last year said she wanted non-EU students to be sent home after finishing studying in Britain’s universities.
Entrepreneurs in the United Kingdom are already working on a fresh global playbook to remain a magnet for entrepreneurial talent. As UK leaders help them focus on a new game plan, we will see lots of initiatives and activities building global connections via non-European bridges. There are plans, for example, to announce GEN’s entrance into the UK on October 4 in London. This bodes well for startup communities outside Europe and offers a fresh boost for London’s blossoming startup scene now looking more often to the world beyond Europe.
While the financial markets have yet to see the light in Europe, history will show that shaking up the rules that Europe has been piling up for these past 20 years will bring new growth for both the UK and Europe. Sometimes it takes an emergency to get things done. The nations that win from this will be those that use the momentum of Brexit to fast-track smart adjustments to their regulatory environments. The winners will be those that make changes now to their ecosystem in preparation for the enormous digital disruption forecast for the world’s most regulated industries in energy, health care, transportation, and education.
Who knows, it may be the best thing that has happened to Europeans in decades.
Jonathan Ortmans serves as president of the Public Forum Institute, an independent, nonpartisan, not-for-profit organization dedicated to creating the most advanced and effective means of fostering public discourse on major issues of the day.