Poll Position

Westminster has spent much of this week focused on political survival. Moments like these tend to sharpen political attention around groups, voters and constituencies that parties believe they cannot afford to ignore. A core aim of ours is to ensure founders command more of that attention.

Entrepreneurs are economically important but politically diffuse. They’re often too busy building companies to organise as a bloc, despite the fact that the decisions made in Westminster often shape whether businesses start, scale or stay in the UK.

But founders have power — not least because they create jobs and wealth, but also because they’re often unusually mobile. A company can be incorporated in one country, funded in another and built across several more. Countries increasingly compete for them not just through tax rates or regulation, but through narrative and ambition. The question is whether the UK can convincingly present itself as a good place to build.

The new wave of our Entrepreneurs Survey is focused on exactly that question. We are asking you how the UK compares with rival hubs such as New York, Paris, Dubai and the Bay Area; whether Britain still communicates a compelling offer internationally; and what story you would tell someone deciding whether to build in the UK.

Previous waves have garnered serious media attention and shaped conversations in Westminster and beyond. We showed, for example, that seven in ten founders knew another entrepreneur considering leaving the UK over tax policy, and that employment taxes were viewed as a greater barrier to hiring than skills shortages or regulation. That’s the kind of evidence we can only produce when founders tell us.

Whether you have completed previous waves or this is your first time taking part, we would value your perspective. It takes around ten minutes to complete and you can do so anonymously or opt in so your comments feed into a short paper we’ll write on this topic.

Whoever is sitting in Number 10, completing this survey gives us the evidence to push for the changes entrepreneurs need.

Breakfast Club

No policy agenda; no panels; and definitely no pitches. Just coffee, pastries and a dozen or so entrepreneurs talking openly about what’s on their minds. That’s the idea behind our No Agenda Breakfasts.

This new format is inspired by the fact that some of the most useful things we hear come from unstructured conversation rather than formal research. It’s also a way for us to meet the growing demand from you, ensuring more entrepreneurs are able to attend an event during the year.

The first one takes place on Tuesday, 2 June at Forsters’ Baker Street offices, from 8.45am to 10am. Spaces are deliberately limited — request a place here.

We’ll be looking for four partners to host one breakfast a month over the course of a year. If your organisation works with founders and you’d like to support the series, get in touch.

Of Bourse

Our Adviser Juliet Gouldman has shared an opportunity for female founders considering public markets. The Aquis IPO Academy — created through a partnership between Aquis Stock Exchange and Barclays Eagle Labs — is a free, six-month programme starting in September to help UK growth companies get public-market ready. If you’re a female founder or co-founder running a business with £1 million+ turnover, applications are open until the end of May. Find out more here.

Source Material

We’re delighted to welcome Geeta Sidhu-Robb as an Adviser. Geeta is the founder and CEO of WCorp, which works with companies globally to improve workplace culture, leadership and retention for women. She founded her first business, Nosh Detox, in 2008 from a £2,000 overdraft, and since retraining as a coach has advised founders and CEOs through IPOs and exits — most recently, Mia Drennan of GLAS Agencies, through a private equity exit valued at over £1 billion.

On why she’s joined us, Geeta says: “The best policy comes from people who’ve actually built something. The Entrepreneurs Network takes entrepreneurial experience seriously — not as a backdrop, but as the source of real insight.” Welcome, Geeta.

Find out how you can join us as an Adviser here.

The King’s Speech 2026

What the Government’s legislative agenda means for Britain’s entrepreneurs.

Cloud Nein

As the local election results come in, it’s worth remembering what councils actually do once the campaigning stops: they spend money — a lot of it on technology, and a chunk of that through G-Cloud, the framework designed to give innovative British suppliers a clearer route into the public sector. That is the theory. The practice looks rather different.

Just this week, and not for the first time, I heard from the founder of a genuinely innovative British technology company that has been blocked from the next iteration of G-Cloud. The reason was not poor delivery, a weak product or lack of relevance to public-sector buyers. It was negative EBITDA and a lightly capitalised balance sheet, both of which are completely normal for growth-stage tech companies.

It goes without saying that the government should not be cavalier about supplier risk. But there is a difference between a company that is structurally insolvent and one that is investing in product, people and expansion. There is a difference between a supplier whose failure would bring down a critical public service and one offering a substitutable software or data product. This is precisely the kind of domestic scaleup ministers claim to want in the public-sector supply chain.

This ‘computer says no’ approach needs to be replaced with something smarter. If procurement rules cannot distinguish between those cases, they will select for the wrong things: incumbency, corporate backing and the ability to satisfy a bureaucratic risk model. They will not select for innovation, and competition will suffer.

This matters because public procurement is one of the largest levers government has. If the state wants more British scaleups, it needs to be a better customer to them. If it wants more competition in public services, it cannot design frameworks that only large incumbents can comfortably navigate. If it wants domestic technology companies to grow, it should not tolerate blunt financial tests that keep them out of public-sector markets.

Get in touch if you have experienced similar issues with procurement frameworks, financial viability assessments or public-sector buying processes. If there is enough feedback, we’ll launch an evidence session through the All-Party Parliamentary Group for Entrepreneurship.

Three of a Kind

A final call for applications for our JVF Female Founder Ambition Series, run in partnership with the Jessica Vollman Foundation.

The series brings together ambitious female founders for three small virtual roundtables. The first session, High Potential, takes place 20 May, 5pm–6pm, for earlier-stage founders with early traction who are working out how to scale. The second, High Growth, takes place 27 May, 5pm–6pm, for founders already growing quickly and navigating the pressures of expansion. The third, Going Transatlantic, takes place 3 June, 5pm–6pm, for founders operating, or seriously planning to operate, in both the UK and the US.

Insights from the series will feed into a briefing paper shared with our network and media contacts. We’ll also be undertaking interviews with some founders for Network Effects.

Crowning Achievement

Recipients of The King’s Awards for Enterprise have been announced. Congratulations to all the entrepreneurs in our network who received the award. You can already apply for the next round here. As mentioned here previously, there is a new Young Founder category that will spotlight founders aged 18–30 who are actively leading their businesses and building success with impact.

Three Big Ideas #60

🧠 Mann Virdee, Head of Science and Technology

Google DeepMind is perhaps the most transformative startup Britain has produced. It’s now synonymous in the minds of many, myself included, with its protein structure prediction system, AlphaFold, and the 2024 Nobel Prize in Chemistry.

But did you know that to secure early funding, DeepMind’s CEO and co-founder Demis Hassabis once had to pitch investor David Gammon at his home — during which he was also required to win approval from Gammon’s wife and three teenage sons? It seems strange now that such a successful company could have been set back or derailed if just one of them hadn’t been convinced by his pitch.

It’s one of many stories in Sebastian Mallaby’s new book The Infinity Machine, which follows DeepMind’s rise from a startup in a Russell Square townhouse to the heart of Google’s operations. It’s well worth a read for those who want to understand what it takes to be a successful entrepreneur, as well as to explore broader questions about the future of scientific research, the nature of consciousness and the potential of artificial intelligence.

The family-veto story is important. In 2010, no British venture capitalist was set up to fund a company whose stated mission was to ‘solve intelligence’. That meant that Hassabis had to piece together funding from Peter Thiel, Elon Musk and others. By the start of 2014, the money had run out and the only viable option was to sell to Google.

Some mistakenly draw the conclusion DeepMind should not have sold to Google. But Google’s compute and resources were necessary for DeepMind to thrive. The lesson is a broader one. Britain still struggles to fund moonshots at the scale and time horizon they need.

It’s been said time and time again that our universities are world class. So too are our founders. But the patient, multi-billion-pound bets that turn blue-sky research into world-leading companies remain largely an American endowment. Closing that gap is partly about R&D and tax design, and partly about cultivating high-conviction angels and family offices willing to back unproven founders with audacious ideas.

That makes the recent news from David Silver, Hassabis’s old Cambridge friend and the man behind AlphaGo, feel like a test. Silver’s London startup Ineffable Intelligence has raised $1.1 billion at a $5.1 billion valuation, which is the largest seed round in European history, with the UK’s Sovereign AI Fund investing alongside Sequoia, Lightspeed, Nvidia and Google. The capital is still mostly from the US, but the company is British. It remains to be seen whether we can keep it that way as Ineffable scales — and whether we can grow and support more companies like it.

🐝 Philip Salter, Founder

Britain’s productivity problem is, in part, a problem of its big cities outside London underperforming. Manchester, Birmingham, Leeds, Glasgow — in most comparable countries, second-tier cities punch above the national average. In ours, they don’t. Closing that gap matters not just for the people who live there but for national prosperity.

A new CEP paper from Aadya Bahl and Henry Overman, Hive of Talent, uses Greater Manchester as a case study to ask what it would actually take to close one component of that gap: skills. The numbers are sobering. Manchester’s productivity sits 35% below London’s, against a 20% gap between, for example, Paris and Lyon. Even partly closing it would require — among other things — an additional 180,000 workers with degree or sub-degree qualifications.

The paper considers three pathways through which Manchester adds graduates: people who grow up there, people who move there to study, and people who move there for work. On the local cohort, even matching London on both attainment and retention, the GCSE pathway would generate only an extra 4,285 graduates a year. The local cohort is “just too small relative to the size of the workforce for even quite sizeable improvements in attainment or retention to generate the scale of changes needed.”

Manchester’s universities attract and retain around 11,400 graduates from outside the city region each year, but a meaningful slice of that depends on international students. The Government’s Immigration White Paper may dampen this significantly. And on non-education migration, the picture is similarly fragile. Manchester currently gains around 2,606 graduates a year through net international migration but loses 1,219 to the rest of the UK, for a net gain of about 1,387. Halve net international migration and the net gain shrinks to just 84 a year — a fall of roughly 1,300 graduates through this channel alone.

As the paper acknowledges, keeping more skilled workers in Manchester only helps if there are skilled jobs there for them to do:

“London benefits from a unique concentration of universities, high-skilled employment opportunities, and strong graduate labour markets that attract and retain graduates from across the UK and internationally… replicating these conditions in [Greater Manchester] would require changes that go well beyond skills policy alone, as factors such as labour market opportunities, wages, and supporting infrastructure all shape graduate location choices.”

The wider lesson is that no single lever moves the dial, and the supply-side levers don’t move it at all if the demand-side jobs aren’t there to absorb the workers. For founders and policymakers tempted by simple stories about either just fixing schools or visas — important as both are — this is a useful corrective. Manchester’s skills problem is a coordination problem, and one the rest of Britain’s big cities, with smaller cohorts and weaker universities, will face in even less forgiving forms.

💼 David Bharier, British Chambers of Commerce

By the late 1990s, most businesses had a website. While many firms simply replicated their brochures online, a smaller group — from Amazon to early digital-native retailers — built their operations around the technology entirely. It was that depth of adoption, not the speed of uptake, that ultimately separated the winners from the rest.

We may be seeing a similar pattern emerge with AI. Much of the current debate focuses on how quickly firms are adopting the technology. On that measure, the UK appears to be moving at pace. Analysis conducted with the University of Essex, using British Chambers of Commerce survey data from early 2026, finds that over half of SMEs are now using AI in some form, up sharply from around a third last year.

But this headline figure masks a more important reality: not all AI adoption is equal. For most firms, AI is not yet translating into meaningful workforce change. Around 95% of users report no impact on headcount, while 86% say job roles remain unchanged. This reflects the fact that most businesses are still using relatively light-touch, off-the-shelf tools — such as ChatGPT or Copilot — to support existing tasks rather than fundamentally redesign them.

The picture looks very different among the smaller group of firms embedding AI more deeply into their operations. Among these businesses, around one in five report staffing reductions attributable to AI, and they are more likely to have reorganised job roles. So it is not adoption itself that is driving change in the labour market, but the intensity of it. This distinction matters. Workforce restructuring may be concentrated among a relatively small but potentially growing segment of firms with adoption.

The key question now is whether this group remains niche or begins to grow. If it does, the lesson from the early internet era is clear: it will not be the firms that simply “use AI” that shape the future, but those that reorganise themselves around it.

In a labour market where wage floors have risen sharply and new firms are taking on fewer staff, the challenge for policymakers and businesses alike will be to ensure that this transition delivers productivity gains while bringing the workforce with it.

Dinner Table Policy

At several events over the past few weeks, I’ve heard a familiar complaint: the media does not represent entrepreneurs well. There is clearly a perception problem. Our Out of Focus briefing paper found that for every founder who thinks coverage is good, five think the opposite. By more than seven to one, respondents said the issues that matter to them are not given sufficient attention in the media. As a former journalist, I am well aware of the constraints and want to be constructive. It is still a bit half-baked, but here’s my pitch.

It begins with a 2018 post by Robin Hanson. Firm productivity depends heavily on management quality; yet even after controlling for intelligence and conscientiousness, substantial variation remains. Hanson thinks most MBA programmes do little to close this gap. Their primary function is selection and network formation. The missing ingredient, he suggests, is direct exposure — having lived through the realities of management or observed them closely.

Empirical evidence supports this. In Norway, economists Hans Hvide and Paul Oyer found that a majority of male entrepreneurs start firms in the same or a closely related industry as their fathers. Those who do tend to outperform peers whose fathers did not work in the same industry. They term this “dinner table human capital”. The effect persists even for founders whose fathers died before they entered the workforce. This is not about introductions. It is about sustained exposure.

Hanson proposes extending this logic to management education:

“If one can learn much from just watching the inside story of real firms over several years, that suggests a big win: record the full lives of many rising managers over several years, and show a mildly compressed and annotated selection of such recordings to aspiring managers. Such recordings could be compressed by deleting sleep and non-social periods. They could be annotated to identify key decisions and ask viewers to make their own choices, before they see actual choices. Recordings might be selected two-thirds from the most successful, and one-third from a sampling of others.”

A lighter version of this idea could plausibly reach a wider audience. Imagine a documentary series that follows a handful of founders over a year or two — cameras in the room for the co-founder disagreements, the hiring calls, the moments a deal nearly falls apart. The good, the bad, and the genuinely difficult. The format exists — Boiling Point, Inside the Factory, Twenty-Four Hours in A&E — just pointed at the people building Britain’s next generation of companies.

The alternative is two more decades of The Apprentice and Dragons’ Den, which have shaped the public perception of entrepreneurship. Matt Clifford’s argument from 2019 still stands:

“Perhaps the cardinal sin is [The Apprentice’s] perpetuation of the crude stereotype of the ruthless, selfish entrepreneur who sees money as the only marker of success. The reality is very different. Teams, not solo heroic figures, are responsible for the biggest entrepreneurial success — there’s huge value in having a co-founder. Also, the desire to create new companies is more often tied to wanting to maximise impact in the world, not just trying to increase their bank balance.”

Dinner table human capital is real, and the country’s media is one of the few mechanisms we have for setting more places at the table. I can’t help thinking that we might be surprised by the public’s appetite if we were a bit more ambitious about what’s being served.

Frank King

Alex Chalmers is consistently worth reading. In his latest Chalmermagne Substack article, he argues that British technology policy has cycled through a series of half-theories without settling on a coherent account of how technology drives growth.

His opening example is instructive. Barnsley was recently designated Britain’s first ‘Tech Town’, receiving £500,000 over eighteen months to support AI skills and adoption — roughly £2 per resident. The accompanying announcement claimed the status would “position Barnsley as the UK’s trailblazer.”

Even if you disagree with parts, the central point should be taken seriously: the binding constraints on growth — energy, planning, employment law, and the broader regulatory environment — largely sit outside technology policy itself.

Opt Into the Loop

Much of what we do at The Entrepreneurs Network depends on partners — organisations that host, sponsor, fund research or otherwise help us serve founders better. To make it easier to share what’s coming up, I’m starting a brief fortnightly email setting out current opportunities to get involved: events to sponsor, research to partner on, roundtables to host, and the like.

If you would like to receive it, just let me know, and I’ll add you to the list.

Message from our Partner

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If you’re building the next big thing, this is where you want to be. Discover Fora with a free Day Pass

Its Name is RIO

Britain’s capacity to invent has never been the problem. But getting new technologies from the lab to the market depends on capital, talent and a regulatory environment willing to make room for things that didn’t exist yesterday.

The asymmetry at the heart of regulation makes this harder than it sounds. When a regulator permits something that subsequently causes harm, the costs are visible, attributable and potentially career-ending. When a regulator blocks something that would have worked — a drug that never reached patients, a technology that never scaled or a business model that never got off the ground — the costs are invisible and diffuse. Nobody is held to account for the cures that weren’t approved or the growth that didn’t happen. That asymmetry shapes behaviour in predictable ways: caution is rewarded, boldness is punished and the default is delay.

That’s a problem in any era. It is a particularly acute one now. Fast-emerging technologies are all hitting regulatory frameworks built for a different world at the same time. The question is whether the UK’s institutional environment can adapt quickly enough to build and capture the value here.

This week, we hosted Lord Willetts and the Regulatory Innovation Office (RIO) alongside a room of robotics founders at Mishcon de Reya. The discussion was under the Chatham House Rule, but sign up to Network Effects for an overview of themes that emerged from the room. The conversation was proof – not that any was needed – that tapping into the experiences of entrepreneurs is absolutely critical for understanding policy reform.

RIO sits within the Department for Science, Innovation and Technology, where it was established in October 2024, with a straightforward but ambitious remit: to update regulation, speed up approvals and ensure regulatory bodies work together effectively.

RIO has just launched the second phase of its Front Door pilot, now open to science and technology businesses across all sectors — not just RIO’s current priorities. The exercise is simple: tell them the regulatory barriers holding your business back. The results will shape how the Front Door service develops.

RIO’s door is open.

(I appreciate not everyone reading this is in science and technology, which is why we, and others, need to look at whether there are lessons we can apply to other domains.)

Shareholder Value

The European Commission is reviewing the rules governing how shareholders receive information, vote and engage with listed companies across borders — and is looking for practical evidence from those whose voices tend to be underrepresented in these debates: minority shareholders, private investors, smaller banks and others with direct experience of cross-border investment or general meetings. If that’s you, contact Martha Wiesenbart at Europe Economics.

Plain English

Language proficiency is one of the strongest predictors of economic integration — and of how far people progress once they’re here. Workers who gain functional English move into better-paid roles and progress within organisations. It also opens up entrepreneurship as an option.

The Department for Education is reviewing the qualifications and content that support this — ESOL provision for adults who don’t speak English as a first language — and wants to hear from employers of all sizes who recruit or support staff in that position. The survey takes 10–15 minutes and closes on 8 May. Complete it here.

Ives Had the Time

Our Research Director Eamonn Ives is off to pastures new. Over the last three years and eight months, Eamonn has proven to be a first-rate researcher, meticulous editor and stand-up guy. He has also been instrumental in our evolution, as he shared:

“While I still think there’s a role for the traditional in-depth think tank report, effective policy influence is increasingly being wielded through shorter, sharper outputs, of the sort we’ve pivoted to of late. Often those outputs — whether interviews, briefing notes, or off-the-record roundtables — have been dependent on the network of founders, investors, ecosystem builders and other policy experts that [we have] painstakingly assembled over the past decade and more.”

Connect with Eamonn on LinkedIn to follow his journey. For those of you who attend our events, I’m sure you’ll still see him around.

Three Big Ideas #59

🔬 Mann Virdee, Head of Science and Technology

It’s not new or insightful to note that Europe struggles when it comes to converting bright ideas and cutting-edge science into unicorns.

What is new, however, is a recently published comparative study in the Journal of European and International IP Law which seeks to explain why. The researchers looked at the legal frameworks of the United States, the United Kingdom and Italy and found a structural difference in how these countries deal with technology transfer (TT). In particular, they claim that the strictness of regulation is less important than the clarity of the regulation.

On one side you have the US model, rooted in the 1980 Bayh-Dole Act. This Act transformed TT by allowing universities, small businesses and non-profits to retain IP for inventions developed from federally funded research, as well as to license discoveries from that research to private-sector partners. That provided a big incentive for universities and researchers to turn discoveries into viable consumer products.

The authors of this study argue that the US model has succeeded because it has created a predictable and coherent regime which gave universities clear ownership of IP, and which also gave investors confidence to invest. The UK has tried to mirror the US model and has been moderately successful, resulting in what the authors call a ‘relatively mature environment’. Both the US and UK models benefit from having clear institutional ownership and Technology Transfer Offices (TTO).

On the other side, there’s Italy’s fragmented model. Italy produces lots of spin-outs but no unicorns (with the notable exception of Bending Spoons, a Milan-based tech conglomerate whose focus is on acquiring and managing products such as Evernote). In Italy, the lack of clear, universal legislation creates a network of ‘autonomous rules’ that leaves founders and investors in a state of constant uncertainty.

So while the US and UK have stricter regulations around academic-entrepreneurial roles than Italy, the authors of this research contend that the ‘coherence, accessibility, and institutional robustness of TT regulation are decisive factors for the emergence of university-born scale-ups’.

Or, to put it another way, clear regulations — even if stricter — are better than vague ones. When a founder knows exactly how many days they can consult (for example, around 13 days at Stanford) and who owns the IP, they can get on with the business of scaling.

Although the UK is in a strong position, there’s more work to be done to streamline TTO processes. Scientific excellence is only half the battle. The other half is ensuring our legal and institutional frameworks are configured to let that excellence evolve into global success.

📚Philip Salter, Founder

In 2008, Clayton Christensen’s Disrupting Class was published, arguing that schools were on the verge of being disrupted. Built around a factory model of standardised content, uniform pacing and batch processing of children, he argued that they were structurally incapable of personalising learning to individual needs. Technology, he contended, offered a way out — not by improving the existing model, but by routing around it entirely.

Christensen predicted that 50% of high school courses would be delivered online by 2019. They weren’t. Billions had been spent putting computers into schools, yet the technology has simply been co-opted into the existing model of instruction.

Last week’s government announcement, which invites EdTech companies to build AI tutoring tools for disadvantaged pupils in the UK, is encouraging. As the press release acknowledges, private tutoring can accelerate learning by up to five months, but it remains the preserve of those whose parents can afford it.

The ambition is right, but Christensen’s insights call into question the design: “Plugging a disruptive innovation into an existing business model never results in transformation of the model; instead, the existing model co-opts the innovation to sustain how it operates.” The Pioneer Group — eight companies, curriculum-aligned, teacher co-designed and DfE safety-approved — is structurally set up to do exactly that. Given the constraints any government programme operates under, it’s perhaps inevitable.

The Pioneer Group will co-design, pilot, evaluate and report, with national rollout targeted for 2027. While this is a relatively ambitious timeline for government, the technology is moving at breakneck speed. There is a real risk this programme institutionalises a version of AI the market has already moved two generations beyond.

In truth, the disruption Christensen predicted is already happening. A motivated 14-year-old with a capable AI can already access something closer to a genuine Socratic dialogue on any subject than most classrooms offer — without a Pioneer Group, without curriculum alignment and without waiting until 2027.

🎓Ayushma Maharjan, Centre for Policy Studies

The UK is one of the best places in the world to produce ideas. But few of those ideas are turned into commercial strength at home. Britain’s academic strength is hard to dispute. Ten of the world’s top 50 research universities are British. However, that scientific excellence has failed to proportionally translate into a dense network of R&D-active firms and the scale-up ecosystem needed to translate research into economic output.

The gap is clear in the data. Cambridge and Oxford rank only 69th and 77th globally as innovation clusters, a striking contrast to their top five standing in university rankings. A country can be brilliant at science and still underperform if little R&D happens inside businesses.

Analysis done by the Centre for Policy Studies suggests that the UK higher education sector performs a relatively high share of national R&D, at around 24%, compared with 11% in the United States. The UK business sector, by contrast, performs about 70% of total R&D, below the roughly 80% share seen in the United States. In leading innovation economies, every dollar invested in higher education R&D is matched by $7 to $9 in business R&D. In the UK, that ratio is less than $3.

One plausible explanation for the UK’s position is that Britain’s wider business environment is not attractive enough for firms to build, test and scale. This is clear from companies like AstraZeneca and OpenAI, which have chosen to halt investment or move activity elsewhere citing tax burden, regulatory complexity and high energy costs.

If Britain does not address this problem, the economic returns on British science will continue to be captured elsewhere. Evidence suggests 80% of UK university spin-out IPOs have taken place overseas since 2012. Likewise, despite ranking highly in AI research, the UK retains only 48% of its talent.

No amount of tax credits or industrial strategies can compensate for a hostile business environment. The UK needs a more innovation-friendly economy. For entrepreneurs, that means a simpler and predictable business environment, competitive taxation, and stronger incentives to stay and scale in Britain.

Cancel Culture

There is a lazy explanation for why Britain has fewer billion-dollar companies per head than the United States, why our founders sell up earlier, and why some are leaving. That explanation is culture. All too often, I hear that Britain lags the US on entrepreneurial culture, with many arguing, by the same logic, that Europe lags behind the UK.

As Alex Nowrasteh argues this week, culture is too often a placeholder where an explanation ought to be. His target is the social scientists’ habit of invoking culture whenever a real mechanism proves elusive: fertility rates, corruption, train punctuality, economic development — all attributed to culture when a better answer may lie in the incentive structure:

“Someone observes a behavioral difference between groups or countries. They can’t immediately identify the mechanism. So, they invoke ‘culture’ as an explanation or, even worse, ‘the culture.’ The word lands with a satisfying thud that sounds like an explanation but isn’t one. It is the terminus of inquiry, not the beginning.”

As Nobel Prize winners George Stigler and Gary Becker cautioned in 1977 in De Gustibus Non Est Disputandum, we should not explain behavioural differences by assuming people in different places have different preferences. Instead, we should treat preferences as broadly stable and look harder for differences in prices, constraints and incentives. Douglass North made a similar point in 1990 in Institutions, Institutional Change and Economic Performance: culture is a partial solution to problems repeatedly encountered in the past. It is an output, not a cause — the behavioural residue of incentive structures that have been in place long enough to harden into norms.

Perhaps the cleanest test of this argument comes from Daron Acemoglu and James Robinson, whose work on institutions and prosperity won the Nobel Prize in 2024. Their signature example is North and South Korea. Same language, same ethnicity, same history, and the same culture up to 1945. One is now among the richest countries on earth, the other among the poorest. The culture was identical on both sides of the border. The institutions, and the incentives they created, were not.

Many of you reading this will share our world view. The good news is that, unlike with the hand-wavy explanation of culture, this gives us something to work with. We can change the rules. After all, Britain has done exactly this, repeatedly.

Right to Buy, introduced in 1980, helped turn Britain into a nation of homeowners. What followed was an asset-conscious, equity-minded electorate, attuned to property prices in ways that still shape politics today. Millions of people were handed a significant financial asset and, rationally, began to behave like people who owned one. Our property-owning culture is, in large part, the product of a policy choice made four decades ago.

The privatisations did something similar. The “Tell Sid” campaign for British Gas shares was not a cultural exercise. It was an attempt to create a class of retail shareholders, and it worked. Popular capitalism was not latent in the national character, waiting to be unlocked. It was downstream of a set of decisions about who could own what.

Introduced in 1994, the Enterprise Investment Scheme created tax advantages for investing in early-stage companies. Before it, angel investing in Britain was extremely niche. After it, a new pattern of investor behaviour emerged, scaled up and eventually became normal enough to attract the label of culture. What looks like cultural change is often just tax policy.

The point is not to defend each of these policies. It is simply to note that, in each case, behaviour followed the rules. Culture was the lagging indicator, not the force leading the charge.

The most common claim I hear is that the US has a culture in which failure is more accepted — even celebrated — than in the UK. But this is often asserted without reference to the fact that the institutional treatment of failure differs substantially too. US Chapter 11 bankruptcy law is explicitly designed to let businesses reorganise and continue. Britain’s insolvency law remains more creditor-oriented, with personal liability attaching more readily to directors. The founder walking away from a failed company in Delaware does so in a different legal environment from the one in Doncaster. Whatever attitudinal differences exist are at least partly downstream of that.

Nowrasteh is careful not to dismiss culture entirely, and rightly so. Values and norms are real. His argument is methodological: look first for the institutional and incentive-based explanation. If you exhaust those and culture is still standing, then perhaps you have found something. But more often, you probably just have not looked hard enough.

Treasury officials reading this will be pleased to know that incentives don’t just mean more money. For instance, despite flaws, patents and the legal system in Britain encouraged innovation to flourish, creating a market for inventions. And as we argued in Honours for Innovators:

“Raising invention’s status and prestige was crucial to how Britain first got its reputation during the Industrial Revolution as the best place to innovate. Invention came to be seen as a viable and attractive career path, not just financially but in terms of the social standing that could result from it – something that was purposefully cultivated by those seeking to improve the country’s technological prospects.”

The Enterprise Investment Scheme didn’t exist in 1993. Right to Buy didn’t exist in 1979. The entrepreneur who couldn’t find an angel in 1992, or couldn’t spin out of a university in 1998, wasn’t held back by culture. They were held back by the absence of policies that came later.

The culture isn’t the problem. The rules are.

A Working Theory

Over on Network Effects, this week we published a cracking interview with Alfie Pearce-Higgins, co-founder of Rodeo on the impact of AI on job markets. Alfie makes a great point about the unintended consequences of making it costlier and riskier to employ people:

“[T]he question everyone is asking — “will AI destroy jobs?” — is less important than the question almost nobody is asking — “will AI change how work is contracted?” If even a moderate fraction of employment shifts to self-employment, the consequences for tax revenues, pension saving, the welfare safety net, and the entire social contract that has been built around the employee-employer relationship are extremely significant. And that shift may well happen not because of any deliberate decision or policy, but as the accidental byproduct of three trends that nobody has bothered to join up.”

Read it in full here.

блакитне озеро

Our good friends at Blue Lake VC have just announced the launch of this year’s UK–Ukraine TechBridge Investment Accelerator, delivered with support from the UK Government and Ukraine’s Ministry of Digital Transformation.

The programme will support 20 high-growth Ukrainian startups at Late Seed to Series A stage, helping them get investment-ready and build connections with UK investors ahead of a pitch showcase at London Tech Week in June.

Over five weeks, participating founders will receive hands-on mentorship from UK venture capitalists, investor office hours and practical support on pitching, UK market entry and scaling. The programme is equity-free and designed to help Ukrainian startups overcome one of the biggest barriers to expansion: building a fundraising network in a new market.

Applications are open until 27 April 2026. More information here.

Stacks Up

We produce a lot more than Perennial Gale — and if you don’t already follow our other Substacks, this is a good week to see what you’re missing.

Over on Network Effects, Mann Virdee sat down with Mollie Claypool, co-founder of AUAR, whose deployable robotic micro-factories aim to do what decades of housing policy have failed to do: make housebuilding faster and cheaper.

Also on Network Effects, our fortnightly Three Big Ideas covered why Europe’s most ambitious startups keep ending up in Delaware (and whether we should care), the state of Britain’s quantum bet and what happens when crime really doesn’t pay. We sometimes take ideas from outside, so drop us an email if you have a big idea you want to pitch.

And finally, if you care about what Parliament is actually doing on entrepreneurship policy, Eamonn Ives’ monthly APPG for Entrepreneurship newsletter is a must-read. It includes key quotes from ‘In Parliament’, so you don’t need to go digging through Hansard, plus a rundown of the Government’s current consultations and calls for evidence.

JVF Female Founder Ambition Series

As many of you will know, we have run our Female Founders Forum with Barclays for over a decade. It has been our most enduring project — watch this space to find out what’s next for us later in the year.

Today, we are announcing something separate to the Female Founders Forum — but which is testament to its ongoing impact: a partnership with the Jessica Vollman Foundation, a non-profit founded to honour the legacy of the late founder, CEO and advocate for women in entrepreneurship, Jessica Vollman.

Sarah Vollman and her father Mike Vollman — a technology executive who has founded and funded companies, taken them public, and now advises emerging AI companies and female founders — join The Entrepreneurs Network as Advisers as part of the partnership.

The series comprises three off-the-record virtual roundtables, each focused on a different stage of the scaling journey, and all chaired by Kajal Sanghrajka. Insights will feed into interviews for Network Effects and a briefing paper. We’re also planning a launch, so let me know if you’re keen to host it.

The first virtual roundtable is for founders in the earlier stages of growth — those with the drive, the idea and the question of how to scale still in front of them. The second is for founders already moving fast, navigating the capital, team and personal pressures that come with rapid expansion. The third is for founders operating — or seriously planning to operate — on both sides of the Atlantic.

Talkin’ bout GEN

Many of you will already know about the Global Entrepreneurship Network (GEN). Where it leads, many follow. And I’m delighted that its founder and president, Jonathan Ortmans, has joined us as an Adviser. Jonathan has been an inspiration and support to many ecosystem builders around the world, including me. For instance, GEN is supporting the JVF Female Founder Ambition Series.

I hope you’ll forgive me for putting my modesty to one side when I share his kind words about why he supports us, and our collective modesty to one side about why he is bullish about the UK:

“I support The Entrepreneurs Network mostly because it is authentic. At GEN, we are exposed to literally thousands of organisations around the globe promoting entrepreneurship, but Philip Salter’s writings and the community he convenes are precise, on point, and always worth the read.

I also remain bullish about entrepreneurship in the UK. There is a certain no-nonsense honesty to British risktakers. Beyond being a Britisher myself, GEN was born from the communities that celebrate Global Entrepreneurship Week, which was created in the UK as Enterprise Week so many years ago by then-Prime Minister Gordon Brown.”

Built to Scale

In our latest interview for our UK AI Fieldbook series, Mann Virdee speaks to Mollie Claypool about how AI and deployable robotics can break the deadlock of the global housing crisis.

Three Big Ideas #58

Three Big Ideas is our fortnightly roundup of ideas (and our takes on them) in entrepreneurship, innovation, science and technology, handpicked by the team.

This week, Philip Salter looks into the data behind Europe’s fleeing founders, Eamonn Ives discusses a new paper on gig work and crime, and Mann Virdee examines the changing capabilities of quantum computing.

Three Big Ideas #58

🌍 Philip Salter, Founder

Is Europe losing its startups? That’s the question addressed in a new paper from the EU’s Joint Research Centre. The answer, of course, is yes: around 3.3–4.3% of European VC-backed startups relocate their headquarters abroad — roughly 10 times the rate of comparable non-VC-backed firms.

The United States dominates as a destination, accounting for around three quarters of moves, with San Francisco, Boston and New York the favoured landing spots. The picture is more nuanced than the headline suggests, though, as 97% of relocations are partial, meaning firms keep operations in their home country, and in a quarter of cases the CEO doesn’t move. Perhaps most concerning, relocation is concentrated in the earliest years. Nearly half of firms leave within their first three years, before they’ve had a chance to embed locally through hiring or R&D, and this is skewed towards asset-light sectors like IT — precisely the high-value, high-growth industries Europe most wants to keep.

The most ambitious firms are the most footloose, with other research cited finding relocation rates of around 13% among larger scaleups and nearly 30% among unicorns. The primary driver is that US investors frequently require — or at least prefer — a Delaware-incorporated parent as a precondition for funding.

Whether this amounts to a serious loss is genuinely unclear. On the one hand, a Delaware flip might allow a firm to raise the round that creates hundreds of jobs back home; or it might be the first step in a gradual shift of gravity westward. Research cited in the paper suggests that around 65% of the workforce ends up in the country of relocation among firms that eventually IPO, but without US funding there might never have been an avenue to scale.

For the UK, the picture cuts both ways. Britain is the second most popular destination for relocated European startups, capturing around 7% of moves — a reflection of genuine strengths in the UK’s entrepreneurial ecosystem. That shouldn’t be surprising: our own research finds that 54% of Britain’s 100 fastest-growing companies have a foreign-born founder or co-founder, drawn from 29 countries across every continent bar Antarctica.

Policymakers in the UK — and actors in our entrepreneurial ecosystem — might be best focused on competing for a larger share of the startups that are going to move anyway. To that end, the Migration Advisory Committee is currently reviewing the Global Talent and Innovator Founder visa routes. Ease of movement won’t solve everything — there are many building blocks we need to put in place — but getting the visa regime right is a necessary condition for the UK to make the most of its position as Europe’s most attractive destination for mobile entrepreneurial talent.

🚔 Eamonn Ives, Research Director

I’ve written previously for Three Big Ideas about evidence suggesting that the gig economy helps to both lower unemployment and boost entrepreneurship. This week, more data emerged that further buttresses the case for gig work. In a new paper, the authors show that the rollout of Deliveroo and Uber Eats in France between 2015 and 2019 caused a reduction in crime rates.

Overall recorded crime falls by 3% following a platform’s entry to a local labour market, but there is an especially steep decline in ‘low-skill property crime’ — such as shoplifting and street robberies. There is little impact on ‘high-skill property crime’ — such as burglary and vehicle theft — but that result, if anything, bolsters the theory the authors put forward. Gig work is disproportionately performed by young men with limited formal qualifications, or people who face labour market discrimination such as migrants. By offering these individuals an opportunity to earn an honest living, platforms reduce their ‘need’ to engage in acquisitive crime. This is standard rational choice model thinking, as first espoused by criminal economists like Gary Becker over 60 years ago, which states that when legal work becomes more accessible, the opportunity cost of offending rises.

Beyond this, the paper also shows how the spread of gig platforms correspond with a reduction in vandalism and drug crime, because, the authors explain, “[t]hese offences are disproportionately committed by adolescents and young adults and tend to be concentrated in the evening and weekend hours that delivery shifts occupy.”

As noted above, plenty of evidence now exists of the purely economic benefits of gig work, especially for marginalised people. What’s interesting about this study, however, is how it illustrates how gig work has positive, broader societal impacts too. It raises the question of what other virtuous effects such platforms might be having on society, and implores policymakers to weigh these accordingly when regulating them.

⚛️ Mann Virdee, Head of Science and Technology

There are some technologies that seem to be perpetually on the periphery of productive commercial use. The running joke for nuclear fusion is that it’s always 30 years away. For quantum, it’s usually 10 years away. I was thinking about this yesterday as I visited Oxford Quantum Circuits (OQC), a spinout from the University of Oxford’s Department of Physics that’s about to raise a Series C.

Earlier this decade, the quantum computing industry went through a bit of a crisis of confidence and there was frequent talk of a ‘Quantum Winter’. But that’s perhaps a natural response to the quantum hype and those labelling the technology ‘bigger than fire’.

At the time, the industry was focused on increasing the number of qubits (quantum bits) in a quantum computer without the need for full error correction (which protects quantum information from errors). But it soon became clear that tackling the source of those errors, noise, was critical to opening up productive applications of quantum computing.

To be clear, there are still sceptics who believe that quantum computing cannot deliver on its promises. But a pivot towards fault-tolerant quantum computing has led to a measured and widely-shared increase in confidence about its near-term utility and the need to prepare for a world with quantum computers.

A blog last week from Google Research suggests that quantum computers could break cryptocurrencies sooner than previously predicted. They argue that there is still time for blockchains to migrate to post-quantum cryptography to ensure they are resilient to quantum attacks, but that time window is shrinking.

The deadline to prepare for quantum computers and the capabilities they will begin to unlock has been brought forward to 2029. That’s not to say we will have fully productive quantum computers by then, but that firms should be prepared.

Some applications such as fraud prevention are likely to be the lowest hanging fruit for quantum computers and can be tackled in the coming few years in the range of millions of operations. As that progresses to billions and trillions, it should open up other applications such as drug discovery.

The UK is well placed to capitalise on this. The Government recently announced funding of up to £2 billion to support the development and commercialisation of quantum technologies, and help strengthen Britain’s quantum pipeline. With the creation of our new Science and Technology Forum, we’ll be doing our part to support founders in quantum and across all areas of science and technology in growing and scaling their businesses.

Hire Purpose

There are many advantages to reaching a large, smart and entrepreneurial audience through this newsletter each week. One of the most valuable is that, whenever we’re hiring, I can rely on you to share opportunities widely. Now is your time to shine — we’re on the hunt for a new researcher to join our team.

In this role, the successful candidate will have the chance to quickly build a public profile, access rooms that are closed to most and do work that genuinely moves the needle. If you’re self-motivated, care deeply about what we do and have an entrepreneurial spirit — or know someone who fits the bill — all the details are here.

We are, if I may say so, a small team that punches well above its weight in the think tank world — producing policy reports, engaging policymakers and helping shape the agenda on the issues that matter most to Britain’s founders.

To that end, please consider forwarding this on; liking, commenting on, or reposting my LinkedIn post; and doing the same with Eamonn Ives’ post on X to help to ensure the opportunity reaches the right people. The stronger our talent, the more effective we will be in making it easier to start and scale a business in the UK.

Beyond Infinity

Innovation is a hallmark of our species, and the entrepreneurs who channel it are the architects of the modern world. To support those pushing the frontiers of science and technology, we are launching a new Science and Technology Forum within The Entrepreneurs Network.

Led by our Head of Science and Technology, Mann Virdee, the Forum will serve as a dedicated platform for science-focused entrepreneurs in Britain, helping to bridge the gap between the lab, the boardroom and Westminster. Our aim is to make the UK the leading global destination to start and scale a science-led business.

The Forum will focus on the UK’s priority sectors — including AI, quantum technologies, engineering biology and semiconductors — by identifying and dismantling regulatory barriers; conducting deep dives into the frontier economy to inform policymakers; and hosting high-level briefings that connect leading scientists and technologists with decision-makers.

We are committed to closing the commercialisation gap and harnessing innovation for national prosperity. To learn more or get involved, contact Mann here.

Building the Case

In any think tank or business group, much of the activity happens below the surface, while most people understandably only see the finished outputs.

That’s why I’ve started sending a weekly update to our Patrons and Advisers, sharing more detail on our work with government, politicians, parties, regulators and others. You can become an Adviser here.

We have also begun publishing our consultation responses. This week alone, we responded to two.

First, our response to the Ministry of Housing, Communities and Local Government’s consultation on establishing a Development Corporation. We didn’t mince our words: “The shortage of housing, office space and laboratory space in Greater Cambridge is not merely a social problem — it is an economic emergency that directly undermines the UK’s capacity for innovation and growth.”

Between 2011 and 2019, 41,000 jobs were created in the area without a commensurate increase in housing; median house prices now stand at eleven times average earnings, and the shortage of lab space constrains the life sciences and deep tech firms the cluster depends on.

We supported the Development Corporation proposal, but urged the Government to be more ambitious in the powers it confers, particularly around plan-making and land value capture. Read the full response here.

Meanwhile, our response to the Department for Business and Trade’s consultation on refining the UK’s competition regime sought to strike the right balance: a regime that is too loose risks incumbents stifling innovative startups; too tight, and founders struggle to attract investment, form partnerships and exit.

While there were proposals to commend, we pushed back the idea of giving the CMA algorithm investigation powers. We argued that smaller startups may lack the resources and expertise to manage investigatory demands, and that such burdens could materially hinder their growth.

We were not alone in this concern — entrepreneurs and investors we spoke to agreed. As one VC told us:

“These powers currently only exist under the digital markets regime, which was designed with large incumbents in mind. Extending them across all competition and consumer protection work means early-stage companies, particularly in AI and software, could face substantial compliance burdens that are wholly disproportionate to their size and resources. A startup with a small engineering team being required to build bespoke testing environments, alter product behaviour, or produce data it doesn’t already hold could face costs that genuinely threaten its viability. There’s a real risk this makes the UK a less attractive place to build and scale technology businesses.”

This is not the end of our work on these issues. Get in touch if either of these things matter to you.

King's Gambit

Earlier today, I joined a Department for Business and Trade roundtable on supporting the next generation of entrepreneurs. The focus was a proposed fifth category in the King’s Awards for Enterprise to recognise young founders, planned for launch in May to coincide with the awards’ 60th anniversary.

We will soon share a broader set of activities for our Young Entrepreneurs Forum, but I would also welcome hearing from anyone keen to do more in this space — we are currently developing a number of ideas.

Late Expectations

Late payments have been strangling small businesses for decades — and this week, the Government has finally moved to do something meaningful about it, with Small Business Commissioner Emma Jones CBE leading the charge.

On Monday, the Department for Business and Trade announced what it’s calling the toughest crackdown on late payments in over 25 years. The headline measures include a hard 60-day cap on payment terms for large firms paying smaller suppliers, mandatory interest on late payments pegged at 8% above the Bank of England base rate, and significantly beefed-up powers for the Small Business Commissioner’s office — including the ability to investigate poor payment practices, adjudicate disputes, and levy multi-million-pound fines against the worst offenders.

Alongside many others, this is an issue we’ve been banging the drum on for a long time. When the Government launched its Small Business Plan last year, which laid the ground for this week’s announcement, I didn’t mince my words:

“In a world where online banking, accounting software and e-invoicing exist, it’s completely unacceptable that so many burgeoning startups see their growth stall due to late payments. At its worst, they can send perfectly good businesses to the wall — leaving Britain’s economy less dynamic and competitive.”

The damage goes far beyond individual closures though — late payments are a drag on employment, exports, investment, profitability and access to finance right across the economy.

At Enterprise Nation, which she founded, Emma campaigned for robust measures to address late payments, including in the reports we worked on together. As a Patron of The Entrepreneurs Network, it’s particularly pleasing to see her now in the driving seat to deliver on those shared ambitions. Emma is proving the value of her own longstanding call to get more entrepreneurs into the heart of government to effect exactly the changes we’ve seen this week.

The numbers behind this are stark. Late payments cost the economy an estimated £11 billion a year, and roughly 38 businesses close every single day because they simply aren’t paid on time.

These new powers will allow her to take that work to a much larger scale. As she said:

“We are on a mission to make life easier for small firms by getting money moving faster through the economy by tackling late payments… These reforms will reduce the hours spent chasing debt allowing small businesses to focus on more productive and enjoyable growth.”

There’s also a notable move for construction: the Government is consulting on banning the withholding of retention payments, a practice that has long left smaller contractors exposed when larger firms go bust or simply don’t pay up.

Take a bow, Emma Jones CBE.

Deal Breaker

We’re putting the finishing touches to our response to the Department for Business and Trade’s consultation on refining Britain’s competition regime. Among other things, it proposes reforms to how the Competition and Markets Authority can regulate mergers and giving it new powers to investigate how businesses use algorithms. If any founders or investors want to tell us their perspectives (either anonymously, or loudly and proudly), you can book a 20-minute call with our Research Director Eamonn Ives via this link.

Trust the Process

Our latest UK AI Fieldbook interview is out. Eamonn Ives sat down with Murat Tunaboylu, co-founder of Antiverse, a biotech company using AI to design antibodies against targets that big pharma has struggled with for decades.

The whole conversation is worth reading, but one insight stood out from a policy perspective: the UK’s medicines regulator, the MHRA, appears to be pioneering something genuinely world-leading — process-level drug approvals.

Rather than approving individual molecules one by one, the idea is to approve the process itself, so that everything it produces carries a validated safety and efficacy profile. As Murat puts it:

“Just imagine: you design something, and in a matter of weeks or months it gets to a human patient who has no other option — whereas the current process for getting a drug approved might typically cost $2 billion and take 12 years to complete.”

If it works, it could fundamentally change the economics of personalised medicine — and the UK is leading it. Murat also makes a strong case for open data mandates on publicly funded research, protecting SEIS and EIS, and closing the persistent seed-to-Series A funding gap. Read the full interview here.

Deep Impact

Innovate UK wants to hear from you. As we covered last week, the agency has published a new prospectus under Executive Chair Tom Adeyoola, signalling a major strategic reset — narrowing its focus to deep and hard tech, introducing specialist Growth Sector teams, and building a connected investment pipeline linking its deal flow to the British Business Bank, the National Wealth Fund and the National Security Strategic Investment Fund.

It’s now running a short feedback survey and we’d encourage founders in our network to respond. The more Innovate UK hears directly from the companies it’s trying to back, the better the final model will be.

Branching Out

The Cedar Review — on whose board I sit — has launched its survey on refugee entrepreneurship. The review is gathering evidence on the experiences of refugee entrepreneurs in the UK: what support was available to them, what was helpful and what’s still missing. If you’re a refugee entrepreneur yourself, or you work with or know someone who is, please consider filling in or sharing the survey.

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Three Big Ideas #57

🤖 Philip Salter, Founder

That vast tracts of our lives are now conducted in concert with and through digital technology is taken for granted by anyone growing up today. For the next generation, the same will be true of artificial intelligence. But, for those of us living through this paradigm shift, the uncertainty can be disconcerting.

Anthropic recently published findings from a large-scale qualitative study of more than 80,000 Claude users across 159 countries. As you might expect, the headline results are mixed: 28% cite economic empowerment as a benefit, while 18% fear displacement.

I will focus on the findings most relevant to entrepreneurship and the UK, though there are broader insights worth digging into.

Globally, 8.7% of users identify AI’s primary promise as helping them build and scale businesses. This is especially pronounced in Africa, South and Central Asia, the Middle East and Latin America, where AI is viewed as a capital bypass mechanism — in other words, a way to start businesses without traditional funding, hiring or infrastructure.

Independent workers and entrepreneurs appear to be the clearest economic beneficiaries. Nearly half report tangible gains from AI, compared with just 14% of institutional employees (47% vs 14%). Those running side projects benefit most, with 58% reporting economic gains.

While the report does not drill down specifically into the UK, it does reveal that Western European sentiment is slightly less positive than the global average (65% vs 67%). Concerns in the region centre on surveillance, privacy and governance. In developed economies like the UK, “life management” resonates more strongly than entrepreneurship, with users more likely to see AI as a tool for managing already complex lives.

This last point may come to matter a lot.

Nobody truly knows how quickly AI will come to dominate, but based on recent performance, those at the most bullish end shouldn’t be discounted out of hand. This will unlock economic growth, but also disrupt much of the status quo. Those with the skills and mindset to build with AI will flourish, as will the countries in which they live.

💊 Eamonn Ives, Research Director

In our latest UK AI Fieldbook interview, Murat Tunaboylu explained how artificial intelligence holds extraordinary promise for novel drug discovery.

One question I was particularly keen to get Murat’s thoughts on concerned whether or not our regulatory system was ready to handle a potential coming tidal wave of innovation. If AI does radically accelerate drug discovery, regulators could be inundated with approvals. In this world, innovation might be happening in one sense, but, in a more meaningful one, the benefits will lie dormant, waiting until a regulator gives groundbreaking drugs the green light.

As it happens, Murat was optimistic that we will avoid a backlog. But it nonetheless got me wondering about how we might be able to tweak regulatory approval systems to future-proof against sclerosis — in healthcare, and in other areas too.

One thing we discussed was the Medicines and Healthcare products Regulatory Agency’s pioneering approach to regulating the ‘processes’ involved in developing drugs, rather than individual drugs themselves. A not too far-fetched analogy here might be that if you asked a half-decent chef to cook you a meal from scratch, you’d probably trust them to make something edible simply by relying on tried and tested culinary techniques, rather than needing to forensically inspect whatever dish they eventually plate up for you.

An obvious riposte to this approach to regulation is that it could result in lower safeguards for things we consider extremely important. There may well be reasons why in some industries we very much do want to closely monitor final products and ensure they’re safe for their intended uses — be that drugs, or food, or anything else.

Perhaps we should therefore look to apply it in areas where there’s little to lose from a loosening of standards. In healthcare, this may be allowing companies working on hitherto ‘untreatable’ diseases to offer trials to patients who currently have no alternative. In logistics, it might be giving a longer leash to autonomous vehicles or drones operating in remote areas far from any human population centres. In education, it may be giving AI-powered teaching assistants to pupils for whom conventional teaching is unsuitable.

As more and more startups harness AI to advance innovation, an increasingly binding constraint on the good it could do will be our regulatory state. Now is the time to start thinking about how we can ensure it facilitates rather than frustrates modern miracles.

🧪 Mann Virdee, Head of Science and Technology

Some scientists are deeply committed to the idea of research as a good in and of itself — that is, simply to advance our understanding of the cosmos, even when its utility in our daily lives seems limited. For others, there is a strong societal dimension — they want their research to have a strong impact, such as in tackling climate change or in improving prosperity.

But that is a false dichotomy. Research can have spillover effects in all kinds of ways that may not initially be apparent.

So, how can we measure the spillovers from science into commercialised technologies? It’s an important question because quantifying spillovers helps us to understand the social returns from science and it’s useful for those designing policy.

That’s at the heart of a new discussion paper from the Centre for Economic Performance. The challenge is that the value scientific research generates in downstream technologies is diffused through chains of follow-on research.

The authors of this discussion paper propose a new measure called Science Rank, which uses combined patent and paper citations to assign a share of the private value of patented inventions to the scientific literature they directly (or indirectly) rely on.

The authors show that Science Rank outperforms other measures, such as patent-to-paper citation counts, in identifying influential scientific research. That’s because traditional metrics only count direct links from patents to papers. This is a bit like judging a tree by looking only at the trunk. It ignores the roots, the vast network of follow-on research that eventually leads to a breakthrough.

Science Rank is more effective at identifying the technological influence of foundational research than traditional metrics. For example, under conventional citation counts, nearly half of Nobel Prize-winning papers appear to have zero impact on technology. In contrast, Science Rank recognises the value of nearly all these prestigious papers, placing them in the top half of its distribution — with over 60% reaching the top 5%

The research also shows that the US remains the undisputed powerhouse not only in generating spillovers but also in keeping the commercial value domestic. The findings provide a more mixed picture for the UK; while we punch above our weight in generating global spillover value, a huge share of that value leaks out to foreign firms — as shown by the geography of beneficiaries.

Three Big Ideas #57

Three Big Ideas is our fortnightly roundup of ideas (and our takes on them) in entrepreneurship, innovation, science and technology, handpicked by the team.

This week, Philip Salter analyses the findings of Anthropic’s bumper survey about AI use, Eamonn Ives explains why we need to act now to future proof our regulatory landscape for a potential wave of innovation, and Mann Virdee wonders how society can better quantify the positive impacts of scientific spillovers.

Engineering the Key

In our latest interview for our UK AI Fieldbook series, Eamonn Ives speaks to Murat Tunaboylu about how AI is accelerating novel drug discovery and could bring about the era of personalised medicine.

Making Waves

Wave after wave, our Entrepreneurs Survey makes headlines. Just yesterday, following the release of our latest instalment, journalists from Sifted, The Telegraph, and City A.M. all reported on our findings. We don’t measure our success by headlines and quotes (encouraging as they are), but by our ability to impact policy, and — ambitious as it sounds — change the hearts and minds of the country.

To that end, each quarter, we reserve half the survey for questions to dig into a thorny policy issue. This time around we focused on tax breaks for founders, with the results feeding into our submission to HM Treasury’s call for evidence around Tax Support for Entrepreneurs.

I won’t bombard you with every stat, but it’s fair to say that these schemes are seen by founders as essential to unlocking early-stage investment. Huge majorities of those who’ve used the Seed Enterprise Investment Scheme (SEIS), Enterprise Investment Scheme (EIS), and Venture Capital Trusts (VCTs) say they would have struggled to raise capital without them — 84%, 86%, and 78% respectively — and even more believe the schemes helped their businesses scale.

That said, founders don’t think the schemes are flawless. While fees and terms are broadly considered fair for SEIS and EIS, VCT users feel differently — 41% of founders regard VCT terms as unreasonable compared to just 33% who find them fair. Opinions on size limits and eligibility were also mixed, particularly for SEIS, where 39% of founders feel the criteria are not appropriate compared to 36% who think they are.

On capital gains, the founder consensus is clear: over seven in 10 believe Capital Gains Tax (CGT) relief drives startup creation, and when asked what they’d do with the proceeds of a more generous Business Asset Disposal Relief (BADR), 72% say they’d invest in someone else’s startup and 70% would use it to launch a new venture of their own. Only 7% say it wouldn’t change their behaviour.

We aren’t claiming this is the only evidence that HM Treasury will need to decide whether and how exactly to reform these tax breaks. But it does add data where previously there was little — and as our panel of entrepreneurs grows and grows, we’ll be able to get more granular with our questions and findings. If you want to have your say next time round, join us.

On the topic of what next, get in touch with Eamonn Ives to share your thoughts on what policy area we should dig into next time around.

VC on VC

The All-Party Parliamentary Group (APPG) for Entrepreneurship — for which we’re the Secretariat — is launching a series of Evidence Sessions, starting with one led by Victoria Collins MP, a former tech co-founder who sits on the Science, Innovation and Technology Select Committee, on female spinout founders. It’s on Monday at 12pm and we may still be able to squeeze in a couple of people if you’re quick.

APPG Evidence Session: Female Spinout Founders
🗓 Monday, 23 March 2026
🕐 12pm to 12.45pm
📍 Online
ℹ️ An evidence session for the All-Party Parliamentary Group (APPG) for Entrepreneurship, on how the UK can better support women turning academic research into successful businesses — chaired by Victoria Collins MP
⏩ Request a place

The sessions will be held virtually, so location is not a barrier, and over the coming months and years we aim to cover a wide range of policy areas around entrepreneurship. Each session will be led by one or more Officers or Members of the APPG, and following each session we will publish a concise write-up of the discussion.

Sign up to the APPG’s Substack for invites to future evidence sessions, including with Lord Marks of Hale CBE on R&D Tax Credits and Lord Kamall on supporting local communities.

Vernal Velocity

Innovate UK has published its new prospectus this week. Under Executive Chair Tom Adeyoola, the agency wants to make sure British breakthroughs result in globally scaled companies.

It’s narrowing its focus to deep and hard tech businesses and introducing a framework to identify high-potential companies. New Growth Sector teams will bring genuine working knowledge of their portfolios. A new Velocity service will provide ongoing account management for founders throughout their scaling journey. And a connected investment pipeline will link Innovate UK’s deal flow directly to the British Business Bank, the National Wealth Fund and the National Security Strategic Investment Fund. As Adeyoola puts it:

“Our vision is a UK where breakthrough ideas — from research, from labs, from anywhere in this country — can become industry leaders. Industry giants. Where those with potential, realise the potential.”

We’ve long argued that the gap between research excellence and commercial success is one of the most consequential challenges the country faces. This prospectus shows Innovate UK agrees. The direction is right — founders in deep tech should pay attention.

Sunday Best

Over at LinkedIn, Richard Tyler reminded me that today is the deadline to enter the Sunday Times 100, their annual ranking of the UK’s fastest-growing private companies. You’ll need four years of accounts, £5 million plus in sales, and to be in profit to be eligible to enter. Finalists get a networking event at the British Museum in September. Enter here.

Sterling Work

Another week; another publication. On Tuesday, we released A Sterling Opportunity, which makes the case for the UK to implement a pro-innovation regulatory regime for stablecoins, bringing benefits to entrepreneurs, consumers and the government.

For the uninitiated, I’ll hand over to the authors, Hugo Okada and Osian Guthrie, to explain what stablecoins are:

“Stablecoins are, at their core, remarkably simple. The most widely used versions are fiat-backed stablecoins, which are digital tokens representing existing currencies and backed one-for-one by safe reserve assets such as cash or short-term government bonds. If a user holds a dollar or sterling stablecoin, they are effectively holding a digital claim on reserves held by the issuer. Stability comes from the promise that the token can be redeemed for the underlying currency at par.”

As the paper argues, and as Hugo and Osian set out in a CapX article, stablecoins enable near-instant, low-cost international payments around the clock, bypassing the delays and expense that plague traditional banking. They also support programmable finance, allowing payments to be embedded into software and automated contracts. Furthermore, stablecoins can boost financial inclusion by giving people in volatile economies access to stable currencies. And for governments, because stablecoins are typically backed by sovereign debt, their growing adoption increases demand for government bonds — which in the case of sterling-denominated stablecoins could help lower borrowing costs, as well as reinforcing London’s position as a global financial centre.

The paper argues that we should avoid overly prescriptive regulation that risks stifling stablecoin innovation before the market has had a chance to develop. We’re particularly concerned by three current proposals: universal redemption obligations, which misunderstand how stablecoins actually circulate on secondary markets; stringent capital requirements, which could shut out the smaller innovators who have historically driven progress in digital finance; and paltry holding caps, which would undermine some of the most valuable stablecoin use cases, including large-scale B2B payments and corporate treasury management.

Instead, we advocate for principles-based regulation focused on transparency, solid reserve backing, and robust custody arrangements — giving the technology and market room to evolve while maintaining credible oversight.

If this is still feeling a bit esoteric, it won’t for long. The total market capitalisation of stablecoins now stands at around $300 billion, with projections of this hitting between $1.9 trillion and $4 trillion by 2030. Lord Holmes of Richmond MBE wrote the foreword, and as former Chancellor George Osborne argued last year in the Financial Times:

“We became the world’s financial centre because we weren’t afraid of change. On crypto and stablecoins, as on too many other things, the hard truth is this: we’re being completely left behind. It’s time to catch up.”

The report was fed into the Financial Services Regulation Committee’s stablecoin inquiry.

Copyright and Wrongs

In our latest UK AI Fieldbook interview, Mann Virdee caught up with Hanna Celina, founder of Kinnu, a London-based educational technology startup with over 1 million users.

The challenges of the UK’s copyright regime feature prominently in the chat, with Hanna describing the UK’s current position as “wilfully shooting itself in the foot.” She argues:

“If you look at British copyright laws, you realise you really cannot do anything. It’s insane how high the level of protection is for copyright holders compared to the US, where companies have the freedom to innovate faster.”

“It goes deeper. We could be making strides in supporting A Levels or IB [International Baccalaureate], but the exam scores and question banks are just not public, even though they are often government-set exams. And if you look at learning standards — what a learner should know for a GCSE — it’s a bunch of poorly formatted Word docs that are completely not LLM-friendly. It was impossible to build a consistent ‘National Knowledge Graph’ from this data the last time we looked at it, which would be like a digital map where every concept is linked to its prerequisites and its real-world applications. That would enable a learner to zoom in and out of topics and understand how concepts relate to other disciplines. But, with recent AI improvements, turning that kind of data into a National Knowledge Graph might just be possible now.”

The interview covers a lot more besides, including how Kinnu uses A/B testing to validate learning interventions at scale; the human-in-the-loop requirement for zero-error tolerance in legal and financial education; how vibe coding is turning writers into product builders; and why Hanna thinks R&D tax credits are better than government grants for agile startups.

Opportunity Knocks

Does your business focus on defence technologies and robotics? If so, you can use the Front Door pilot to tell the Regulatory Innovation Office (RIO) about any regulatory barriers you have.

The Front Door is an experimental, business-led pilot by the RIO to collect and address regulatory challenges. It aims to make it easier for businesses to highlight barriers, helping RIO target reforms where they are most needed and to support innovation and growth.

The trial closes in a week. Share your experience here.

Message from our Partner

Join us for an exclusive deep dive into the sale of Cadcorp, a leading geospatial software provider, to NEC Software.

In this live panel discussion, the sellers of Cadcorp will join our Head of Corporate Finance, Matt Katz, to take you behind the scenes of their journey, from shaping a growth story in a specialist market, to navigating strategic conversations with a global buyer, to completing a deal that secured the next chapter for their team, product, and customers.

• When? Tuesday, 24 March 2026, 8.30am to 11am

• Where? Buzzacott offices, 130 Wood Street, London, EC2V 6DL

Three Big Ideas #56

Three Big Ideas is our fortnightly roundup of ideas (and our takes on them) in entrepreneurship, innovation, science and technology, handpicked by the team.

This week, Philip Salter examines new research on the returns from collaboration between SMEs, Eamonn Ives argues that stablecoins could help bring down Britain’s debt burden, and Mann Virdee asks why the prioritisation of legislative process over purpose all too often leads to distorted outcomes.