
The Brexit hangover has left UK startups drained – Are the brains next? - ognevvv
https://techcrunch.com/2016/07/09/the-brexit-hangover-has-left-uk-startups-drained-are-the-brains-next/
======
gregdoesit
I work in London. Since the referendum, all my European, non British
colleagues -including myself - have started to discuss places we could
potentially move to, "just in case". Amsterdam, Barcelona, Berlin are the most
popular ones - and I've found myself thinking much more seriously that it
might be time to prepare. Perhaps some of my colleagues are on the same page.

Yes, there are 2 or 2.5 years when nothing will change theoretically. But do I
really want to commit to a country, with uncertainty as to what will happen
after this 2.5 years?

I suggest everyone affected do their research on the options available.
Luckily, there are plenty. Just in case.

~~~
planetjones
I fail to see what the panic is about. Britain will not want to lose access to
the single market, so it is inevitable that nothing will materially change
regarding immigration. Look at Switzerland whose citizens voted to control EU
immigration and are now being told it is impossible. Even implementing a
policy which says Switzerland can limit immigration to job sectors where the
unemployment level is high is meeting resistance. And why is immigration such
a worry anyhow. It is not like Britain would never have immigration. Last time
I looked the USA startup scene does not seem to struggle even though they do
not have an open borders policy with nearby countries.

~~~
50CNT
AFAIK all the treaties Switzerland has with the European Union include a
guillotine clause that cancels all treaties when one is broken. This is due to
the difficulty getting the required number of member countries into agreement
on treaties. This mean that if Switzerland instituted policies infringing on
the free movement treaties, it'd need to renegotiate every single other
treaty, potentially with less favorable terms, and long negotiation periods,
during which Switzerland is effectively cut off from the rest of the EU. It's
not impossible, but doesn't seem worth the cost for something that size.

~~~
mike_hearn
I have written an analysis of what might happen next year in Switzerland and
elsewhere:

[https://medium.com/@octskyward/ok-what-
now-e3f64d38f7#.q4vch...](https://medium.com/@octskyward/ok-what-
now-e3f64d38f7#.q4vchepw1)

It is almost without question that the Swiss will hold another referendum in
the coming months, as their deadline for implementing the previous
referendum's legislation (which they are legally bound to do) will expire in
February. However due to the latency on getting new laws through Parliament
they really have to start now.

There is no way to renegotiate with the EU because the EU sees any
geographically European population that chooses to defy the EU as some kind of
terrorist, with whom negotiation is unthinkable. They refused to negotiate
with the Swiss and are now demanding the Swiss join the EU proper or else
there won't be any further negotiations (ever). The Swiss do not want to join
the EU. So the stage is set for a showdown.

The _best_ case outcome for the EU is a new vote in which the Swiss choose to
continue the status quo for a little while longer.

------
ThomPete
EUs trade with each other represents only 16% of all trade in the world and
this number is declining. The EU has no fintech/startups center beside the UK
and thats not going to change (Berlin doesn't have the money)

EU is killing, not fostering startups. If anything startups thrive where there
is complexity because it means there are problems to solve.

The EU is politically trying to solve a lot of problems but they have nothing
but technocratic reasons to do so. I.e. they aren’t actually very good at
allocating resources to the right problems for europeans because they have no
feedback mechanism allowing for a better insight into what are the EU citizens
problems.

Instead they are solving problems with the very bureacracy they helped create
themselves to begin with.

If anything the EU should stop trying to solve politically what can be solved
through technology and via startups.

The UK's fintech sector is going to be just fine and most probably boosted
because it's not the problems of the EU that makes UK's fintech successful
it's the world.

Technology does and can make up for any legislative complexity and it's going
to foster a whole new slew of startups.

So the UK is going to benefit greatly for this and can now make trade deals
that benefit the UK while continuing to do fintech without any problems what
so ever.

EU isn't some economic powerhouse which one should only be so lucky to be part
of. It's primarily catered towards supporting old industries and trade
barriers. More countries should reverse back to the common market.

The fact is no one knows whats going to happen. But if history is any
indication the UK is going to come out stronger not weaker from this.

~~~
pbhjpbhj
>they aren’t actually very good at allocating resources to the right problems
for europeans because they have no feedback mechanism //

Do you have something in mind here, some examples. One of the big things at
the moment is how well EU money was targeted to poor areas in need of social
support. All these poor areas seem to have voted to remove vital EU subsidies;
there no way the Tories are going to reinstate any of it (nor spend any saved
capitation on the NHS, IMO, not without first privatising it).

Doesn't a collapse pound make it much harder for businesses that import or use
overseas factories at all. It may be a small effect but if it's as easy to
startup something in the EU, then surely even a little advantage is good?

~~~
ThomPete
Giving money to poor areas isn't actually proof of anything besides money is
taken from some other regions and given to others. Who gets what in the EU is
purely based on the various countries and organizations ability to make the
most out of it.

Denmark had an area which spend billions subsidizing various efforts with EU
money without any success.

So while that might be great for the local community getting money from the EU
isn't a sign of anything besides the EU gives out money based on your ability
to get money of out the EU. It's not based on some system of fairness or
priority.

The pound is not going to collapse just as little as the Danish krone did when
we decided not to be part of the Euro. Back then the amount of scaremongering
about what would happen to Danish economy was insane, yet Denmark is one of
the countries who fared best after 2008 and still have tripple a rating.

The EUs funds are largely there for the taking. If you can make a case based
on some vague notions you can get money from the EU. That can easily be solved
by the individual countries instead.

------
poooogles
Having just had one developer decide not to join our UK based company due to
this, then yes I feel brains will be next.

I'm certainly thinking about my continued residency in the UK. Berlin looks
pretty interesting for me, however the tech seem definitely doesn't seem as
vibrant as that of London at a quick glance.

~~~
cs02rm0
One swallow does not make a summer.

There's going to be a period of uncertainty where there may be an effect, but
if they hurry up and get on with it then some stability should return. If the
15% rate of corporation tax comes in or other measures it could well encourage
investment.

In the meantime, I suspect Brexit will be a convenient excuse for anyone
wishing to decline a job offer regardless of whether that's really their
reason.

~~~
tkyjonathan
Hiring in the UK tech sector has largely stopped. There are no positions,
unless you are a devop - in which case, there are tons of positions. If people
are so interested in saving the UK tech scene, why not hire people already
living in the UK? Those people will not be able to survive until consumer and
investor confidence returns and they will be the first to head out to other EU
countries.

~~~
ZenoArrow
> "Hiring in the UK tech sector has largely stopped."

You're basing this on what exactly? I got a new job this week and there was
plenty of people hiring tech talent (I had interviews lined up with 5
different companies within 2 weeks of starting to look).

~~~
tkyjonathan
Lucky you. I've been out of work for a while and there is also the matter of
700,000 less job ads from before the referendum.

~~~
ZenoArrow
What sort of work are you looking for?

------
dazc
"European staff suddenly have no idea how long they will be able to work in
Britain."

Well, after 5 years they can stay indefinitely.

[https://www.gov.uk/apply-for-a-uk-residence-
card/permanent-r...](https://www.gov.uk/apply-for-a-uk-residence-
card/permanent-residence-card)

You can apply for a permanent residence card after you’ve lived in the UK for
5 years. This will prove your right to live in the UK permanently.

~~~
solidangle
Those rules might change, one of the Conservative candidates announced that
she'll kick out all EU immigrants that enter the UK after she becomes the
prime minister.

Edit: source:
[https://twitter.com/samcoatestimes/status/751682424405430272](https://twitter.com/samcoatestimes/status/751682424405430272)

~~~
formula1
To put it bluntly, Im confident the UK doesnt want ti self destruct. The
immigration issue that spurred this delema was syrian, middle east abd north
african immigrants. Saying "those rules may change" seems to be more fear
mongering to the point of hoping for a worst possible outcome.

~~~
BjoernKW
> The immigration issue that spurred this delema was syrian, middle east abd
> north african immigrants.

Not entirely, the common argument is also about cheap workers from Eastern
Europe. Ironically, recent accession of countries like Poland, Romania and
Bulgaria was specifically and emphatically supported by the UK.

------
afarrell
American software engineer who is leaving the US in 35 hours to work for a
startup in the UK here. I feel like even for non-EU immigrants, the brexit
makes Britain in general less attractive. Part of the reason I'm joining the
company is getting to work alongside folks from across the EU and, while I
strongly suspect they'll ultimately be alright, I wouldn't be surprised if
they were more anxious. Another reason is that my wife loves to travel, we are
going to use London as a base, and this does hurt the value of my salary for
traveling in the EU.

~~~
afarrell
Aside from the impact on myself, I'd strongly suspect that non-white
immigrants feel less welcome due to the uptick in racist incidents (or at
least the media reports thereof) which has accompanied this.

hmmm.... It just occurs to me that I've been assuming I'm still white in the
UK. I think that is a safe assumption, but race is weird so I suppose there is
a slight possibility that my skin is dark enough that I'm not. huh.

~~~
switch007
Please put away the tar brush. 52% of voters is not the majority of the UK
population. I doubt even a majority of the 52% have deep-rooted hatred of
foreigners. Extrapolating public feeling based on reporting of recent, horrid,
despicable events is not fair nor scientific.

Even if on a shallow level someone is anti-foreigner, I believe their
discontent comes from somewhere else (if they had a well-paying, secure job, a
house with a low mortgage payment, excellent prospects for their children
etc... they'd forget about foreigners).

~~~
afarrell
I'm stating a suspicion about the perceptions held by non-UK citizens. I'm not
making a claim about the mindset of UK citizens. In fact, I'm not making any
claims at all about the racial angle because:

1) I don't live in the UK yet

2) Race is weird

~~~
switch007
I was born here, lived here 97% of my life. Perhaps it would be prudent to
listen to those that live here to confirm/deny suspicions? Your choice
obviously.

~~~
afarrell
Right, but I'm not saying anything about the people who've lived here. In my
first sentence, I'm suspecting things about the perceptions of people outside
the UK (or possibly recent arrivals).

In my second, I'm speculating wildly about how race works in the UK but
stating that I really don't know.

By the way, as an actual concrete statement: Your border force is absolutely
grand and made me feel so welcomed. I should be going to sleep to stave off
jet lag, but I am just really excited to finally be here after many years of
planning and working toward this.

------
ZenoArrow
For all those reading this article and agreeing with it, I'd like to point out
that it follows the classic scaremongering approach... suggests the worst case
scenario based on an uncertain future, and explores no possible solutions. The
only people it holds value for are those that seek to gain from dividing us.

From what I can see, the central claim the article makes is that hiring tech
talent is going to be harder post-Brexit. There are a number of issues with
this claim. For one, the perceived issue with immigration was pretty much
never with those who were filling a skills shortage. I've never heard anyone
complaining about doctors and nurses being brought over to work in the NHS,
for example. The perceived issue was with low-skilled workers and/or people
who were resistant to integration with Western values. I personally don't have
an issue with immigration (and believe the problems are hugely exaggerated by
the media), but to be fair to those that do have concerns about immigration,
it should be pointed out that their misgivings weren't really directed at
high-tech workers.

Secondly, there's the issue that talented individuals from EU countries may be
less interested in coming to the UK. There is likely to be some people who
perceive the situation this way, but there's plenty of tech talent all across
the world, and the UK will remain a destination that people from less
economically developed countries are interested in coming to, especially as
the English language is widespread across the world.

I hope that the new Conservative leader will lay out a plan that makes it
clear the people who are currently living in the UK can continue to do so,
regardless of the state of our EU membership. I think it'd be a great help in
putting immigration speculation to bed.

------
mianos
There are lots of reasonable arguments to investing in the UK first. They now
have the opportunity to innovate without having to work on with committees
with thousands of people on them (cookie laws, wtf). As an investor I have
more trust in the UK than the rest of Europe. The employment argument is
reasonable except, there is still plenty of Eastern European talent that was
never in the EU.

~~~
matt4077
\- The UK will end up still following EU regulations because anything else
would risk their access to the common market

\- Even now, EU regulations affect non-EU companies. No way to avoid the
"cookie law" if you want to serve EU customers.

\- The list of regulations that affect startups, especially in the
web/software space is rather small. The impact of regulation on the startup
scene in Europe is almost zero.

~~~
UVB-76
_> The list of regulations that affect startups, especially in the
web/software space is rather small. The impact of regulation on the startup
scene in Europe is almost zero._

Complete and utter nonsense.

If you're planning on establishing a start-up in the UK/Europe, and you
believe this to be the case, you need a lawyer to give you a reality check
sharpish.

~~~
matt4077
I've been running a successful startup in Germany for 5 years and I feel the
impact of bureaucracy is negligible in the scheme of things.

One exception may be employment law, but that's not made by the EU and
generally, once you figure it out for your first employee, it becomes much
easier for any 1+n.

------
DrNuke
I'm afraid no one in my EU high-skilled network is going to stay in New Little
England long term after Brexit: there is simply too much resurfacing from
under the elitist carpet of multiculturalism and cosmopolitanism, nothing of
our strict business really.

------
mychaelangelo
"Given that the UK had been part of a single market which allowed for enormous
freedom of movement, its access to all that talent in Europe is now in
jeopardy."

I don't think UK Govt will jeopardise access to talent with unprogressive
immigration reform. UK tech startups need not worry on this front. And just
look at USA as an example. Despite VISA issues for foreigners, Silicon Valley
still thrives and still has reasonable access to a global pool of talent.

~~~
insulanian
Silicon Valley has acces to US talent pool, which is significantly higher than
the UK one.

------
throwaway991132
> European staff suddenly have no idea how long they will be able to work in
> Britain.

I've heard a number of politicians say that those who are here will be able to
remain. It would be such a mistake to suddenly tell people to leave. It's not
going to happen.

Also a number of points about he article.

> Although Europe’s 500 million citizens dwarfs the 323 million in the US

So what. They all speak different languages, not one. So there are some
hurdles there to selling to them.

In addition. Only about 4? countries in the EU are rich enough to be trading
with. The rest aren't really worth a mention.

I'd easily take the 323 in the US, as I have only 1 language to deal with and
immediate results in setting up a business for the US.

> “Long term I think I will have to relocate my business to the USA as the
> market in the UK is just too small to justify staying here,” she told me.
> What’s that? A market of 65 million too small? Well, yes, when just a
> fortnight ago it was 500 million.

This is laughable. I have a business in both the UK and the US. Even if I was
just operating in the UK. I'd still have access to the US. How this article is
sounding like the UK cannot trade with the EU is again laughable.

This article smacks of scare-mongering.

Finally one thing, follow the money.

> Look for talented British entrepreneurs suddenly turning up in Berlin,
> Stockholm, Lisbon and Barcelona.

Wasn't there an article on HN saying that Barcelona couldnt find enough tech
workers? The evidence pointed to compensation.

I doubt there will be much of a brain drain, when British tech workers balk at
how much they'd be losing in salary working anywhere apart from the UK or US.

~~~
NetStrikeForce
> Wasn't there an article on HN saying that Barcelona couldnt find enough tech
> workers? The evidence pointed to compensation

Because there's no shortage at all. That's the yearly "we need to keep wages
low, so push people to study It by promising jobs" article sponsored by the
big companies.

There's a shortage of entrepreneurs, VC money and in general management talent
that learned to manage a company after the 80s.

------
keithpeter
[http://blogs.lse.ac.uk/politicsandpolicy/politics-is-too-
com...](http://blogs.lse.ac.uk/politicsandpolicy/politics-is-too-complex-to-
be-understood-as-just-either-left-or-right/)

Above link might help understanding of the politics behind our vote. I had a
bad feeling when I saw how very close the opinion polls were. Once Farage did
the immigration poster it was game over. Our first political assassination
this century seemed to polarise the situation as well.

Using the orthogonal scales explained in the link above, you guys are neo-
liberal economically and have a cosmopolitan outlook. Many - not a majority,
just _enough_ \- people in England have a communitarian outlook and are left
wing economically.

What you have going for you is that the government is also right wing
economically. The leadership may move slightly to the communitarian end - it
only has to move _enough_ to make it work.

The new leader and her government will need to dance like anything - they will
have to conduct a complex set of negotiations (remember UK has not negotiated
a trade deal for 40 years) that will involve the usual performance you do when
making deals - but at the same time they will have to keep public opinion
reassured (or at least bored - i.e. avoid upsetting it). Not an easy trick.
One candidate seems to be on a bit of a learning curve from this morning's
news.

Remember that those of us who ticked the 'remain' box basically all wanted the
same thing - status quo. What did those who ticked the 'leave' box want? Quite
a few incompatible things from my conversations over the last few weeks. The
new Prime Minister will be making _more than half the people_ unhappy - this
last idea comes from an Irish Times columnist whose name escapes me right now.

You need to hedge for uncertainty in any way you can.

PS: If you think London has problems, think about how things look from
Belfast.

~~~
wcummings
This has a picture of the poster for those interested:
[http://www.theguardian.com/politics/2016/jun/16/nigel-
farage...](http://www.theguardian.com/politics/2016/jun/16/nigel-farage-
defends-ukip-breaking-point-poster-queue-of-migrants)

------
tkyjonathan
I think there is a much stronger point that is being ignored. No one is
currently hiring in London. There are 700,000 less jobs ads then before the
referendum. If EU hubs actively pick up those who are unemployed in London, it
would be enough of a 'brain-drain' for London start-ups to notice.

------
andy_boot
It is definitely going to be a problem. And people are already pushing see:
Truck Drives Around London Urging Move To Berlin: [http://www.lbc.co.uk/truck-
drives-around-london-urging-move-...](http://www.lbc.co.uk/truck-drives-
around-london-urging-move-to-berlin-133339)

~~~
andy_boot
I don't understand the downvotes here.

I work in a London startup where about 90% or our engineers are not British.
They tell me that they are already seeing adverts saying 'move to
berlin/dublin' on their facebook feed. There is a real danger that as well as
not being able to recruit people, the people that are already here will simply
leave.

------
philliphaydon
Too much speculation and scare mongering.

