At the weekend, UK Prime Minister Theresa May gave her strongest signal to date that Brexit is likely to mean leaving the European Union Single Market, a hint that gave the Pound another wobble on the currency exchanges.
So it’s hardly surprising that the government will be cheered by another ‘Life after Brexit’ story today as Snapchat announces it has chosen to open its first international HQ in London, a decision taken after the Brexit vote.
The US firm cited the strength of the UK’s creative industries as reason to use the country as a base to “build a global business”. Claire Valoti, general manager of Snap Group in the UK, said:
We believe in the UK creative industries. The UK is where our advertising clients are, where more than 10 million daily Snapchatters are, and where we've already begun to hire talent.
The firm will open a new site near to its existing office in London's Soho and hire more staff, including a small number of engineers. There’s already been some investment in the UK, with staff headcount now totaling 75, up from six a year ago.
The company will create a new UK-based holding company through which all non-US royalties will be routed and will pay UK corporation tax on its international profits. The government has indicated that a post ‘Hard Brexit’ regulatory regime in the UK would involve significant reductions in corporation tax at a time when European Union officials are clamping down on tech firms tax arrangements.
Inevitably the UK government is keen to position this decision as a vote of confidence in a post-Brexit Britain. Matt Hancock, the digital minister, said it was "another vote of confidence in our tech economy." It follows a decision by IBM in November to set up four new cloud data centres in the UK, while Apple is expanding its London operations in Battersea Power Station from 2021. Google will also open a new London building that could create up to 3,000 jobs and Facebook plans to create an extra 500 jobs in the UK when it opens its London HQ in 2017.
In another bit of good news for Brexit supporters, the latest research from Tech City UK, suggests that tech workers and entrepreneurs are now more optimistic about what lies ahead. Nearly half (49%) of the more than 2,000 people working in tech and digital surveyed say they are positive about business for the year ahead. That compares to around 8% polled in June immediately after the vote.
Meanwhile O2’s Business Barometer survey also revealed 64% of UK businesses plan to expand into new markets, and 69% intend to bring new products or services to market this year. 80% of businesses expect technology to be a significant driver of commercial gain in 2017.