Some policy ideas take a while to bear fruit. Take this week’s announcement of the AI Growth Lab, a regulatory sandbox in which innovators can safely test their AI products under adjusted or temporarily relaxed regulations.
This announcement puts a bit more meat on the bones of the AI Opportunities Action Plan, which, among many other things, called on the Government to “work with regulators to accelerate AI in priority sectors and implement pro-innovation initiatives like regulatory sandboxes.” However, this is an idea with a long history.
Success, of course, has many mothers and fathers, but it’s worth looking into the work of John Fingleton CBE, who, over the years, has created the conceptual framework and supplied the intellectual ballast for those making the case for the sort of pro-innovation regulation the UK needs. His advocacy for bounded regulatory discretion and competition-driven innovation not only influenced the creation of the FCA’s sandbox, but also this week’s announcement.
The most compelling aspect of the policy is the option to regulate across the economy, rather than relying on the coordination of existing regulators. This chimes with Fingleton’s idea for an ‘n+1 regulator’, which he explained in an interview I conducted with him earlier this year:
“The idea of the n+1 regulator goes back to about 2012, when I worked in the Cabinet Office and was advising on supply-side reforms. The essential idea was that new business models come along, and the existing regulatory framework doesn’t suit them. That could be because incumbents have captured it, or it could be because what they’re doing is just more risky or has a different profile of risk.”
The point here isn’t to write the history, but to shape the future. The Department for Science, Innovation and Technology has opened a consultation and would like to hear from individuals and organisations who are interested in using the AI Growth Lab; who are going to be affected by it; or who have expert views on implementing sandboxes.
Having spoken to the officials working on this policy, we highly recommend relevant entrepreneurs in our network consider responding. If you’d like to get in touch with us beforehand about that, my email is always open. We may also host a roundtable discussion with the government on this topic, so please get in touch to show early interest.
Anasta–see ya!
After a highly productive year and a half with us, our Head of Science and Technology, Anastasia Bektimirova, has left to join the Royal Academy of Engineering. Anastasia achieved a lot during her time at The Entrepreneurs Network, including authoring Governing in the Age of AI: Building Britain’s National Data Library, Towards a More Special Relationship and Full Speed Ahead, but perhaps her greatest legacy will be in moving our newsletter here – to Substack – which is proving to be a brilliant decision as our content and numbers continue to grow. Anastasia will be staying on as an Adviser – nobody ever really leaves The Entrepreneurs Network.
Network Intelligence
Anastasia also helped launch our new UK AI Fieldbook series, with her interview with Paul Patras, founder of Net AI, which looks into how AI is transforming mobile networks to prevent communications blackouts and optimise energy consumption.
It’s a cracking read with a lot of lessons for policymakers, including the need to design funding and policy around real startup experience, not top-down assumptions; to fix cash-flow pain by paying grants upfront rather than in arrears; to emulate ARIA’s speed, flexibility and minimal paperwork; and to bridge gaps between early-stage schemes like ICURe and follow-on support.
There’s also a clear case for modernising grant rules to suit globally distributed teams, tailoring evaluation criteria to company maturity, and, coincidentally enough, investing in AI sandboxes and better public compute tools so startups can safely develop and deploy innovations in critical sectors.
The UK AI Fieldbook series is kindly sponsored by OpenAI. This gives us the time and resources to really uncover the policy lessons from entrepreneurs at the cutting edge. We want to replicate this sort of deep policy dive with entrepreneurs across other areas of the ecosystem, so if you’re keen to partner with us on this, get in touch.