According to a new industry study, UK competition regulators are fooling domestic tech investors with the implicit threat of cracking down on startup M & A.
When the British Minister of Finance was involved with the tech industry at today’s “Chatham House” style event, the Digital Economic Union (Coadec) Think tanks have released a study that found startup investors ready to draw capital into their outlook. Competition and Markets Authority (CMA) New Digital market unit (DMU) Become a “regulator of the entire economy by chance”. Investors are concerned after the CMA recommends giving the DMU “extended authority” to investigate M & A transactions.
Controversy over DMUs is emerging, with increasing likelihood of blocking the acquisition of tech startups, especially for national security reasons, especially by US companies.
In a Coadec study, half of investors said they would significantly reduce their investment in UK start-ups if their ability to withdraw was limited, with an additional 22.5% of UK start-ups under tighter regulatory conditions. He said he would stop investing in the UK altogether.
In addition, 60% of the investors surveyed felt that UK regulators had only a “basic understanding” of the startup market, and 22.2% said they had no understanding of the tech startup market. I feel it.
Coadec said conservative estimates indicate that the UK government’s DMU proposal could reduce venture capital to the UK by £ 2.2 billion and UK economic growth by £ 770m. I did.
Dom Hallas, Executive Director of Coadec, said of the report: But nurturing an ecosystem means knowing where to intervene and when not to intervene. The data show that the current proposal may not only miss some bad behavior in some areas like the B2B market, but also risks creating unnecessary barriers in other areas like M & A. Is shown. Equally critical, there is not much confidence in the fact that regulators are proposing them, frankly. “
Findings revealed when Prime Minister Rishi Sunak held the Treasury Connect conference in London today to bring together the CEOs of Britain’s largest tech companies and VCs in a “listening process” aimed at reaching out to the industry. became.
However, at a post-event press conference, Sunak pushed back the findings, citing a study by Professor Jason Furman, chair of the Digital Competition Expert Panel. And so far, there is no false positive in the decision making. “The system is considering this to get the right balance,” Snack said.
In addition, more than one-fifth of the UK’s big cities are employed in the technology sector, with £ 11.2 billion invested last year, setting a new investment record, according to a statement released today by the Treasury. Insisted.
Snack also said Future fundAssisted UK-based tech companies with convertible bonds during a pandemic and handed over 150 high-growth companies’ shares to UK taxpayers.
These include: Vaccitech PLCCo-invented the COVID-19 vaccine with the University of Oxford and is well known as the AstraZeneca vaccine inoculated to 170 countries around the world.I also invested in the future fund Century Tech, An EdTEch startup that uses AI to personalize learning for kids.
British Government £ 375mFuture Fund: Breakthrough‘The initiative has continued since July this year and aims to be a high-growth, R & D-intensive company.
A Coadec study also found that 70% of investors feel that UK regulators are “thinking only about large existing companies” when designing competition rules, not startups or future innovations. understood.
However, according to research, London is still as highly regarded as California and is an attractive destination for startups and investors.
As UK Gov reaches out to tech, investors threaten to ‘pull capital’ over M&A regulator over-reach – TechCrunch Source link As UK Gov reaches out to tech, investors threaten to ‘pull capital’ over M&A regulator over-reach – TechCrunch