Tech entrepreneurs in London are wading in uncharted waters as Brexit looms. Steve Ranger, the UK editor in chief of ZDNet and TechRepublic, discussed with me how the tech startups are responding to Brexit. The following is an edited transcript of the interview.
Read Steve's full TechRepublic cover story, The Brexit dilemma: Will London's start-ups stay or go, for the latest on Brexit and it's anticipated impact on the tech industry in the UK.
Steve Ranger: It's still nearly six months until Brexit happens, but a lot of people are getting ... A little bit confused, a little bit uncertain about what's happening, largely because of the larger political situation which is we don't really know how Brexit is actually going to happen. So, for small startups, they are looking at their supply chains. They're looking at staffing. They're looking at investment, and really a whole bunch of things will ... It depends on a whole bunch of things whether you are preparing to make big changes, or really just holding tight and seeing what happens next.
Karen Roby: Any impact on jobs? Do we know how those will be affected, Steve?
Steve Ranger: So, in its early days, it looks like from the people I've been speaking to, and I've certainly been speaking to quite a lot of companies recently, there has been some impact on jobs. So, a few European nationals have decided that since the vote to leave the European Union ... The UK has become a little bit less welcoming to them, so they have moved home, for example. Moved back to France or to Germany. Other companies are ... Some companies are finding it harder to recruit from Europe now because the status of people moving from Europe isn't entirely clear. Other people are finding that there's still quite a rich market because London is still a great place to work and if you're a software developer, you will work with big companies doing exciting things and London is still a great place for that. So it really is a mixed situation.
Steve Ranger: Again, if we have a no-deal Brexit, which means we leave the European Union without any agreement for what we do in the future, that could have a much bigger impact on jobs, but that's still a few months away, yet.
Karen Roby: Okay, what about as far as investment is concerned?
Steve Ranger: It's a similar picture with investment. I think the people I've been talking to have been saying that maybe investment is now being split, so whereas say a big investment might have gone just to the UK a couple of years ago. Now, investors are looking to split that risk, so maybe a significant chunk will go to London, but maybe they'll spend a little bit of money in Paris, or in Berlin instead. It's also possible that venture capitalists are holding fire to see what happens with Brexit. You might find that after March next year, there is actually an uptick in investment in the UK because that money which VCs are keeping in their pocket right now might be spent once they understand what the landscape looks like post Brexit in the UK and in London.
Karen Roby: You've talked a little bit about some of the negatives here. What about upside to Brexit?
Steve Ranger: So the people I'm talking to which are tech entrepreneurs, VCs, industry groups, they kind of scratch their heads a little bit when you talk about the optimistic side of Brexit, largely because it depends on the deal. So, if something in the deal means there are better regulations around, say, data protection or selling on the internet, that might mean a few upsides of the UK. A few people have said to me that what entrepreneurs really like is uncertainty, because that means they can see kind of where the opportunities are, and take advantage of them. Some of the other entrepreneurs I spoke to said what businesses really hate is uncertainty because that creates all sorts of stresses and strains in their business, which they could really do without. It is possible that there will be some upsides in Brexit. It will be possible that there will be some regulation changes that will benefit some companies, but mostly it's not looking like it's gonna be a hugely ... Good piece of news for tech companies in the UK.
Karen Roby: Steve, to wrap up here, where do we go next?
Steve Ranger: Well, in terms of the UK and Brexit, we've got another six months of working out exactly what the final deal looks like. The problem is, for many tech companies, they're gonna have to start making decisions quite soon about things like staffing and investment, which means they need an answer sooner rather than later.
- 10 illegal interview questions that could get you sued (free PDF) (TechRepublic)
- Brexit deal could leave UK businesses out in the cold (ZDNet)
- With Brexit lurking, are French startups benefiting as US bets on France? (ZDNet)
- Brexit: A cheat sheet (TechRepublic)
- Why Silicon Valley CEOs now have France on their to-do lists (CNET)
Karen Roby is a reporter for TechRepublic. Prior to joining CBS Interactive, Karen worked as an anchor and reporter for several CBS affiliate stations owned by Hearst Communications and Gray Television.