UK Diary: Thursday - A Visit To Accel Partners - UK Is Tough On Startups
Thursday morning the Traveling Geeks head to Accel Partners, one of the top European VC firms, to hear presentations from:
- Errol Damelin, founder and CEO of Wonga
- Kristian Segerstrale, founder and CEO of Playfish
- John Newton, founder, Chairman and CTO of Alfresco
- Joe Cohen, Founder and CEO of Seatwave
- Michael Smith , Founder and CEO of MindCandy
- Celia Francis, CEO of WeeWorld
Accel is still making investments, which is very rare among European VC firms (and Silicon Valley firms too).
I chat with John Newton, an American based in London and CEo of Alfresco, and also Joe Cohen from Seatwave, about the UK startup scene. Here are some highlights:
- It is much harder to found and run a startup in the UK.
- Government policies do not favor startups, there are unfavorable tax provisions for stock options. And the government doesn't get the digital economy.
- It is hard to find the right people with the right skills in the UK and they cost more.
- Government buys software from the large vendors, very little from startups, 85 per cent of government spending on IT goes to the top 8 US vendors.
- Large US companies headquartered in London tend to tie up much of the top local talent.
- Some UK startups are restructuring outside of the country to take advantage of more favorable tax and other conditions.
- London has a huge number of foreign nationals. You can run a foreign office from the UK by hiring any nationality, it reduces need for larger staffs in local regional offices.
- Risk taking in the UK is changing for the better.