It’s the start of a week in which the Brexit vote might change the course of the UK forever; it’s also the start of London Technology Week which seeks to promote the capital city as “a global powerhouse for tech”.
The crossover between the two was highlighted today as a number of leading UK tech industry leaders finally stuck their heads over the parapet and declared for Remain in the European Union (EU) in Thursday’s referendum.
To date, the tech industry hasn’t been particularly high-profile in the debate. US firms operating in Europe have played a carefully neutral card. Salesforce, for example, has an official party-line that the decision should be left to the British electorate - although some board members are more frank in their personal views! SAP in Germany did come out in favor of Remain some months ago, standing alongside a number of other German companies, such as Siemens.
But in a letter to The Times newspaper today, 34 UK-based tech CEOs - including heads of country or region of US global operations - have made the strongest statement to date, arguing that Brexit could stall the UK’s tech growth engine. The signatories include the UK heads of Microsoft, Hewlett Packard Enterprise, CSC, IBM and SAP as well as indigenous UK firms such as Skyscape and BT.
The letter reads:
Tech companies are not starry eyed about the European Union, but repeated surveys of start-ups, SMEs, investors and corporates make it clear that the overwhelming majority would vote to stay in.
Why? Because we believe staying in the EU is the best choice for the UK economy. According to techUK members, most of whom are small businesses, being part of the EU makes it easier for them to trade and do business across Europe. It makes the UK more attractive to international investment and makes Britain more globally competitive. A decision to exit the EU would leave tech firms and their customers, facing significant and prolonged uncertainty and leave the UK side-lined on key decisions that will shape a digital market of 500 million consumers.
The UK’s tech sector is a global success. It is growing faster than the rest of the UK economy and creating new businesses and jobs across the country. EU membership has underpinned that success. A vote to leave would undermine it.
Kazuo Abe, MD, Hitachi Europe; Tobias Alpern, CEO, iPlato Healthcare; Justin Anderson, CEO, Flexeye Group; Sarah Atkinson, VP, Communications, CA Technologies; Michel van der Bel, UK CEO, Microsoft; Olly Benzecry, Chairman, Managing Director, UK & Ireland, Accenture; Susan Bowen, VP & General Manager EMEA, Cogeco Peer1; Victor Chavez, Chief Executive, Thales UK; Virginia Choy, CEO, PretaGov Ltd; Julian David, Chief Executive Officer, techUK; Nick Denning, CEO, Diegesis; Paul Green, Creative Director of Iotic Labs Ltd.; Nicola Hall, Managing Director, Ingenica Solutions; Simon Hansford, CEO, Skyscape; Andrew Hartshorn, Managing Director, Methods Advisory Limited; Andy Isherwood, Managing Director, UK and Ireland, Hewlett Packard Enterprise; Paul Kaye, Managing Director, Intelliqa; Michael Keegan, Senior Vice President, Head of EMEA Product Business and Chairman UK & Ireland, Fujitsu; Tom Mockridge, Chief Executive Officer, Virgin Media; Kim Nilsson, CEO, Pivigo; Carlos Oliveira, CEO & Founder, Shaping Cloud; Yoge Patel, CEO, Blue Bear System Research; Gavin Patterson, Chief Executive Officer, BT; Rupert Pearce, Chief Executive Officer, Inmarsat; James Rigby, Chief Executive Officer, SCC; Peter Rodgers, Chief Executive Officer, 1060 Research; Ben Roome, CEO, at800 ; Philip Sheldrake, Managing Partner, Euler Partners ; Francis Toye, CEO & Founder, Unilink; Elizabeth Vega, Chief Executive Officer, Informed Solutions; Cormac Watters, Managing Director, UK, SAP; Craig Wilson, Regional General Manager, CSC; Sarah Windrum, CEO, The Emerald Group; David Stokes, CEO, IBM UK.
Most of these have not taken a position publicly before now, although BT has been vocal in its support for Remain, going so far as to write to all its employees urging them to vote to stay in the EU.
The TechUK reference in the letter relates to a poll of 277 UK tech business leaders conducted back in March, which found that 70% of respondents favored Remain, 15% Leave and 15% were undecided.
Those in the Remain camp said that EU membership makes the UK more attractive to international investment (76%); gives companies a better deal on trading relationships within the EU (75%); and makes the UK more globally competitive (71%). 42% believe the UK would create more jobs within the EU.
The Remain respondents said that a vote to leave would create more risk and uncertainty for their business (73%); make the UK less attractive to foreign investment (65%); give the UK less influence on the issues that impact their business (58%); and that the UK would have to trade internationally on less favourable terms (55%).
The 15% in the Leave camp said the UK would have more flexibility in a global economy (91%); be more globally competitive (64%); and give the UK a better deal in its relationships with the rest of the world (58%). 24% believe the UK would create more jobs outside the EU. They felt the main drawback of remaining in the EU is that the UK does not have sufficient influence in the EU (64%) with 54% citing the regulatory burdens imposed by the EU.
The publication of the letter coincides with the launch of the 2016 London Technology Week, a showcase event intended to highlight UK success stories and stimulate inward investment. This year’s event was kicked off by Ed Vaizey, the UK Digital Economy Minister, who warned:
The digital single market is a massive opportunity in the UK for businesses and start-ups to spread their wings. We can't put that at risk. We have had massive success stories from the talent pool coming in from Europe, but if we vote to leave on Thursday we put that at risk, and that talent could start going elsewhere.
He was backed up by London Mayor Sadiq Khan in an opinion article for City AM newspaper in which he wrote:
With just three days to go until the EU referendum, we can’t ignore that the biggest potential barrier to the continued growth of the tech sector in London is the prospect of Britain leaving Europe.
I helped to run a business before entering politics so I know how important it is that we are part of the biggest single market in the world – with access to 500m customers. Staying in the EU will not only mean our tech companies in London, and across the country, will benefit from the EU single market, but also the completion of the digital single market, which will bring new jobs and investment to London.
Not a single one of Britain’s unicorns – the tech firms valued above $1 billion - is publicly in favour of a vote to leave.
As the US tech providers with skin in the game in Europe have said, it is down to the British electorate to make its view heard on Thursday. That said, it's good to see a number of UK tech leaders putting their position on record.
Whatever camp you're in, it's unlikely that there are many, Remain or Leave, who won't be glad to see the end of one of the most unpleasant periods of political rhetoric and hyperbole in UK electoral history. It's going to be a long week.
It's nice timing in a way to have London Technology Week to provide a positive focus for the next few days, celebrating the potential of UK tech start-ups in a global, not just national or regional, market.
What comes next, we shall deal with on Friday.