Last year I contributed to a UK House of Lords committee looking at scaling of AI and creative technology in the UK. You can download the full report here, but these are the key points from my perspective:
- Fragmented Support Landscape: The UK’s innovation support ecosystem is overly complex, with a “spaghetti” of government schemes lacking coherence, making it difficult for businesses to navigate effectively.
- Financial Barriers to Growth: Access to scale-up capital remains a critical issue. Despite early-stage funding being robust, later-stage investments are limited, pushing companies to seek growth opportunities abroad.
- Risk-Averse Culture: The UK struggles with a cultural reluctance to celebrate entrepreneurial success and a preference for short-term returns, limiting ambition and innovation.
- AI as a Cross-Sector Driver: AI is not just a sector but a transformative technology with potential across various industries. However, scaling AI businesses requires not just funding but also infrastructure, regulatory clarity, and talent.
- Createch’s Untapped Potential: Creative technology (Createch) offers significant economic potential, but scale-ups face challenges such as investor unfamiliarity with the sector, fragmented funding, and unresolved intellectual property issues.
- Need for Long-Term Policy Commitment: The report calls for sustained government commitment, beyond temporary programs, to ensure lasting support for scale-ups, particularly in AI and Createch.
- Access to Talent as a Bottleneck: Talent acquisition, especially in AI, remains a top barrier, compounded by restrictive immigration policies and insufficient domestic skills development.
- Regulatory Hurdles: The current regulatory environment is seen as complex and sometimes counterproductive, with calls for reforms to procurement processes and competition laws to foster innovation.
- International Competitiveness at Risk: Without strategic action, the UK risks becoming an “incubator economy,” where innovative companies are nurtured domestically but scale and reap economic rewards abroad.
- Recommendations for Immediate Action: The report advocates for streamlining public support, accelerating financial reforms, celebrating entrepreneurial successes, and committing to AI and creative industries’ growth as national priorities.
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