The Brexit catastrophe? Maybe not so much.
by Alice Gallop
Supporter of the Creative Industry and Founder of Toucan, Rasha Khawaja, believes that, “There is no better time for British start-ups to rise to the challenge ahead and do what they do best – innovate.”
DISASTER HAS STRUCK- well, according to the 18-25 demographic on social media, that is. So, if anyone happened to miss it, some 73% of British voters turned out to have their say in the EU referendum (the other 27% were playing Sims, trying to decide between an Italian meatball or pulled pork Subway, or battling against the ferocious floods).
Whilst the economy has taken a jolt, David Cameron has thrown his toys out of the pram and called it a day and Nigel Farage endured a humiliating interview on ‘Good Morning Britain’ that saw his ‘promises’ of £350 million to the fund NHS fall apart (is anyone actually surprised?), the world has kept on turning.
This reassuring continuation of life – the sun coming up even if the Pound is going down – hasn’t stopped some small business owners fretting over the loss of the single European market and access to European talent. Angus Dent, chief executive of start-up ArchOver lamented ‘this country, which was on course to become the world’s fourth largest economy, will now go backwards. What a waste of all the hard work’, ‘the outcome is a disaster … you can expect foreign businesses, institutions and other investors to start pulling out of the UK’.
It hasn’t even been the duration of an 18-30 ‘lads on tour’ Ibiza smash-up since 23rd June yet. Truth is, it is way too early to predict what the future holds. Dent’s gloomy appraisal might be bunkum, although if enough people agree then it might also become self-fulfilling.
The worst thing to do now is dwell on the result and fall into a sluggish post-Brexit despondency. Entrepreneurs are, by their very nature, optimists. Rolling up their sleeves and making the best of the moment is at the heart of their job description, and that has got to be the case now. It is up to the entrepreneurs to show the rest of the world that the UK will continue to be a competitive, entrepreneurial and dynamic hub and resist Dent’s predictions of economic decline.
The level-headed response has already been embraced by some industry leaders such as Saul Klein, Atomico, Seedcamp and Index Ventures. Venture capital firm, Atomico, reasoned ‘we’ve seen this over and over again. Microsoft and FedEx started out in the 1973-1975 oil crisis and US recession. Skype was founded in 2002, during what was still the dotcom nuclear winter. Airbnb, Spotify and Uber were born during the 2008-2009 financial crisis. This, if it turns out to be a crisis, will be no different’.
Brexit may even be an entrepreneurial boon relieving our forward thinkers of the EU’s encumbering directives and regulations. The Centre of Economic and Business Research calculated that SMEs are forced to waste 28 hours a week (just think about over a day’s worth of wasted productivity) on EU red tape, costing the small business economy nearly £5 billion every year. Christian Faes, chief executive of LendInvest, a peer-to-peer mortgage lender, celebrated ‘Europe is a big bureaucracy and some of the laws and directives you see coming out of Europe do seem like nonsense and we will not be burdened by that in the future’. Whilst these ill-thought-out regulations might just be a mere nuisance for larger firms used to spanning continents, for a number of small businesses compliance may be the difference between profit or loss, success or failure.
There are other positives around; the pound has indeed fallen (makes our exports more competitive abroad); and Mark Carney has hinted heavily that interest rates will fall which is pretty nice for those of us with business overdrafts.
Only time will tell how this momentous decision will impact businesses but, being both optimistic and opportunistic, it is unlikely that entrepreneurs will wait around for the macroeconomic data. True entrepreneurs are opportunity hungry and they will be ploughing on regardless. Technology entrepreneur, Saul Klein, summed it up: ‘if you’ve got lemons you make lemonade, that’s what entrepreneurs do.’ There is absolutely no doubt that the entrepreneurial community makes the finest lemonade – so come on, have a seat and try a glass … that’ll be £3.50 please.