Not a single one of Britain’s fintech unicorns backs Brexit

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Not a single one of the 14 British tech unicorns, private companies with a valuation of more than $1 billion, supports Britain leaving the EU, according to a new report.

 

‘Crazy to leave’

High profile companies such as TransferWise, Funding Circle and Just Eat have explicitly come out against the potential British exit at next month’s referendum. Property search website Zoopla and Ve, an e-commerce technology company have also vocally adopted the same stance, according to the Guardian.

The remaining nine companies told the paper that they were officially neutral or declined to comment.

“We believe it would be crazy for the UK to leave the EU, both for businesses and consumers,” Taavet Hinrikus, the co-founder of the financial technology (fintech) startup TransferWise, told the paper.

Funding Circle said a successful, well-functioning Europe is crucial to fintech companies like itself and such a Europe must have the UK in it.

 

Economic and political uncertainty

Leaving the EU would lead to economic and political uncertainty, said Alex Chesterman, co-founder of Zoopla.

“We have benefited from access to both capital and talent as part of the EU and leaving would create both economic and political uncertainty, which could have a material impact on our currency, borrowing rates, house prices and wider consumer prices,” he explained.

David Brown, the CEO of of e-commerce technology company Ve, said the UK leaving the EU would be a senseless decision from the point of tech businesses in London. In fact, he adds that rather than thinking about leaving, we should actually forge even closer ties with the EU on a trade and economic basis.

He went further to say that a Brexit would undermine the UK’s business standing in relation to the US even further.

“From an industry perspective, Europe has always played the poor relative to the US because there is very low liquidity in public markets and, as a result, less capital in Europe for the tech industry. A Brexit would also reduce the likelihood of IPOs being conducted in Europe, with those that do happen unlikely to see success on the scale of the US. This would be very damaging for the tech industry today and is playing into the hands of the American capital market and tech industry.”

This line of thought has recently been fleshed out by an EPA report a Britain out of Europe would lead to a very uncertain future, especially for London which has successfully positioned itself as the leading financial services capital not only in Europe but also the world.

Moving out?

TransferWise’s Taavet Hinrikus actually told the Guardian that if Britain does vote to leave Europe, TransferWise may leave Britain.

Like many businesses in London we chose to headquarter here because of the access to global talent and global markets. If the UK leaves the EU, we’ll have to consider whether it makes business sense to stay headquartered here. It’s a decision we don’t want to make but one that we’re having to consider. This year we’re setting up offices in Australia and Asia, and the fact is that countries and cities all around the world are in competition when it comes to attracting businesses. London is a great place to set up a business today but other cities are fast catching up.

 

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Unicorns such as AO (formerly Appliances Online) Asos and Farfetch all declined to comment with AO saying that any decision would have little impact on its operations. However, it did add that there would be an increased level of uncertainty for the UK economy.

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