Thanks to the Tory government, Brexit has been an awful prospect hanging over U.K. startups since this time last year — the vast majority of which strongly hoped to remain in the European Union.
But today founders in the U.K. have been grappling with the nightmare made real after the public voted in a national referendum by 52 percent to 48 percent to leave the EU.
Shock, disbelief and disappointment were common sentiments among the startups TechCrunch spoke to, many of which had scrambled emergency meetings to consider their immediate steps in the face of a seismic shift in the political and economic landscape of both the U.K. and the European region as a whole.
Uncertainty is the prevailing feeling, as you’d expect, but for earlier-stage startups, and those in certain sectors with lots of customers in European markets, there can also be real fear. Or at least a sense that their founding tie to the U.K. might just have been unpicked.
No U.K. founders were pretending they knew exactly what was going to happen as a result of Brexit, but concerns are plentiful in areas such as staffing and talent acquisition; how they will continue to serve European customers; and whether they’ll be able to effectively scale internationally from a British base.
And against a backdrop of concerns and questions, founders are having to make key business decisions in the face of rapidly descending political fog and a plunging pound sterling.
Welcome to Brexit-induced business blindness.
None of the startups I spoke to is considering relocating out of the U.K. at this early stage, but many are thinking about how they might need to restructure their businesses going forward — including several that said they might well be setting up bases in other European countries in the future.
Founder, Graham Parker, CEO of seed-funded online shipping platform U.K. startup Kontainers, which operates in the U.S. and U.K. markets and has offices in the North of England as well as in London, is definitely in Camp Fear where Brexit’s “prolonged period of massive uncertainty” (as he categorically put it) is concerned.
To date the business has ploughed most of its resources into the U.K. market. That might have to change, he said.
“After today, having been live a year and working closely with a lot of British exporters, we’re really thinking can we afford to focus on just the U.K.,” he told TechCrunch. “There’s so much uncertainty around shipping, with the borders that would reappear all over the EU — no one knows what kind of complications that will have. We have customers that have big contracts in Asia and South America and places and they’re wondering will they continue to buy from Great Britain when it’s not in the EU and they lose the protection of EU trade tariffs. So we’re really worried. And we’ve been looking to say do we really accelerate our plans for the U.S.?