Despite the negative news coverage surrounding Brexit, the UK tech sector remains strong, with no pause on investment and innovation. This part of the economy has accepted the change that Brexit will bring and is busily adapting to a post-Brexit Europe.
At ground level, there has been no slowdown in business activity; entrepreneurs in the UK are still as innovative and industrious as ever, and investors are just as keen to participate in their ventures.
Crucially, the combination of specialist skills within the tech sector, plus the highly-developed entrepreneurial community and economy, has enabled start-up and scale up companies in the UK tech sector to deal with the initial shock of the Brexit vote, adapt to the change, and now move on.
While Brexit may have an impact in the short term, in the longer term the underlying strengths of the UK will come to the fore. In fact, in the very short term, since the Brexit referendum and sterling’s fall against most major currencies, UK companies have become even more attractive to international investors.
Add to this the significant strengths that investors have always found in the UK (such as the strong rule of law; a well-educated population; quick adoption of technology; developed professional practices; and arguably one of the most developed and sophisticated financial services industry in the world), and when the March 2019 deadline has passed, the UK start-up and scale-up sectors will be in a far better position than the media is portraying.
The UK tech sector presents the opportunity to invest in the six core areas of digital technology: cloud computing; AI; cyber security; augmented and virtual reality; big data; and blockchain, where we are, if not global leaders, certainly within the leading pack.
At a consumer level, AI can be seen in products such as Amazon’s Alexa personal assistant or the driverless cars currently being developed by Tesla, BMW and Toyota and others, but the potential application to business is equally significant. In the business world, AI is increasingly automating manual processes, increasing efficiency while driving down cost and reducing the risk of human error. It also allows businesses to focus their time and effort on the activities which generate the most value. It is the early adapters who integrate AI into their business practices that will be able to make that cultural shift, and will be able to reap the benefits as a result. Embracing AI and the opportunities it offers should overcome the obstacles that Brexit will bring.
The launch of Smith & Williamson’s AI fund is one such opportunity, as investors focus on its application across the entire business landscape.
Regardless of the final shape of Brexit, the rise of technology for business and consumers and the increasing importance of cyber security looks set to continue for the foreseeable future.
Technology is an advantage in the hands of the modern start-up; savvy entrepreneurs understand the need to adopt technological improvements that can provide a competitive edge. Equally, investors see a strong opportunity in the growth of the digital economy and the rise of automation and intelligent systems that add value to businesses.
Having a trusted advisor able to guide you through the technology maze and help you with strategic planning can make all the difference to your business, both today and for tomorrow.
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.