Public & Academic/Government/News/ UK tech leaders call on government to act now to save startups Save our Startups campaign warns that many of the 30,000 startups in the UK could collapse. By Michael Stothard 5 April 2020 Save our Startups Save our Startups \Venture Capital EU deeptech fund speeds up investments but many startups still left waiting for funding By Zosia Wanat 17 November 2022 Public & Academic/Government/News/ UK tech leaders call on government to act now to save startups Save our Startups campaign warns that many of the 30,000 startups in the UK could collapse. By Michael Stothard 5 April 2020 Some of the most influential figures in UK tech have backed a campaign to push the government to follow France and Germany in announcing a support package for startups to deal with the Covid-19 crisis. The Save Our Startups (SOS) campaign, launched on Sunday, has warned that many of the 30,000 startups and high-growth businesses in the UK, who employ nearly 330,000 people, do not qualify for existing support measures and so could collapse unless new policies are put in place to support them. In an open letter to British prime minister Boris Johnson, the high-level group warned that, as a result, the country could “lose a generation of startups and high growth businesses to Covid-19” and fall behind the rest of Europe in terms of innovation. The campaign — launched by crowdfunding platform Crowdcube — is being supported by figures such as Brent Hoberman, the cofounder of Lastminute.com; Alex Chesterman, the cofounder of Zoopla, LoveFilm and Cazoo; and Arnaud Massenet, cofounder of Net-a-Porter. Over 20 industry bodies and organisations have also joined the campaign — including The Entrepreneurs Network, Draper Esprit, Virgin Startups, Vala Capital, Innovate Finance, Runway East, UK Business Angels Association (UKBAA), EISA, Tech London Advocates, Capital Enterprise, Seedrs and Coadec. The open letter contrasts the actions of the UK government with that of those of France and Germany, which have “raced to the rescue” of its startups and tech communities by committing billions in funding. In the last two weeks, the French and German governments have become the poster children of the European startup community, respectively committing €4bn and €2bn in specific relief for the sector. Many in the UK tech community now want something similar. The Save Our Startups group says that while the UK government’s Coronavirus Business Interruption Loan Scheme (CBILS), which was introduced to provide financial support for small and medium-sized enterprises (SMEs) during the pandemic, is positive, in practice many startups will not be covered as they are loss-making. The campaign is, therefore, calling on the UK government to provide an equity-based liquidity package designed specifically for startups to save those at risk of collapse. Secondly, the group calls on the government to fast track payments to startups from public funding schemes — in particular, R&D tax credits and Innovate UK funding grants. The third call is for the government to change rules for the existing Enterprise Investment Scheme (EIS), Seed Enterprise Investment Scheme (SEIS) and Venture Capital Trust (VCT) schemes (which incentivise private investment into startups through tax breaks) to make them more advantageous for this difficult period. However, the call for more action has already proved controversial. Robin Klein, the cofounder of seed-stage venture capital firm Local Globe said that we should refrain from “knee jerk” responses to give away taxpayer money to startups. “Please don’t ‘knee jerk’ react to the call to ‘save our startups’ by deploying much needed Tax payers ££ directly,” he said in a Tweet. Other UK tech figures such as Matt Clifford, the cofounder of startup builder Entrepreneur First, and James Wise, a venture capitalist at Balderton Capital, have also called for caution in the government getting too involved in financially supporting startups. On Sunday, Wise said on Twitter: “Govt fund that ends up owning stakes only in those Cos where private investors will no longer act could be a disaster for the tech sector and public finances in the long run.” The full letter by Save Our Startups can be read here. And the list of signatories is below. For more on the various responses of European government to help startups amid coronavirus, see our resource here. And for more Sifted coronavirus coverage, see here. List of signatories: Darren Westlake — cofounder and chief executive, Crowdcube Luke Lang — cofounder, Crowdcube Brent Hoberman, Executive Chairman, Founders Forum; previously Co-Founder, Lastminute.com Alex Chesterman — founder and chief executive, Cazoo; previously cofounder, LoveFilm and Zoopla Arnaud Massenet — cofounder, Net-a-Porter Mike Muller — cofounder, ARM Anthony Fletcher — chief executive, Graze Tania Boler — founder, Elvie Doug Monro — cofounder and chief executive, Adzuna Jeff Lynn — cofounder and executive chairman, Seedrs Saurav Chopra — cofounder and chief executive, Perkbox Daniel Korski — founder and chief executive, PUBLIC David Dunn — chair, UK Tech Cluster Group Philip Salter — founder, The Entrepreneurs Network Andrew Tibbitts — chief operating officer, TechHub Charlotte Crosswell — chief executive, Innovate Finance Jenny Tooth OBE — chief executive, UKBAA Jonathan Sibilia — partner, Draper Esprit Dom Hallas — executive director, The Coalition for a Digital Economy (Coadec) John Spindler — cofounder and chief executive, Capital Enterprise Mark Brownridge — director general, EIS Association Natasha Guerra — cofounder, Runway East Andy Fishburn — managing director, Virgin Startup Russ Shaw — founder, Tech London Advocates Alex Davies — founder and chief executive, Wealth Club Bruce Davies — director, UK Crowdfunding Association Andrew Roughan — managing director, Plexal Jasper Smith — founder, Vala Capital Gaby Hersham — founder, Huckletree Carlos Silva — cofounder, Seedrs Robert Walsh — managing partner, Q Ventures Related Articles The brave new data-protected world By Carly Minsky Click here to read more Fintech, talent and IPOs: France’s plan to overtake London after Brexit By Marie Mawad in Paris Click here to read more Can tech for good be as profitable as plain old tech? 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