Brexit: Investors pin hopes on small and emerging businesses after UK leaves EU
A majority of UK investors are pinning their hopes for the post-Brexit business landscape on small and medium-sized firms and startups, but many also fear that the Government does not have the measures in place to fully support companies.
A survey of over 1,000 investors, conducted by peer-to-peer trading platform Asset Match, shows that 57 per cent believe entrepreneurs and SMEs will be the champions of the UK’s post-Brexit economy. Nonetheless, 54 per cent of respondents also said that they are not convinced the new Government can create a strong, global trading network outside of the EU.
“Today’s research also demonstrates a lack of faith among investors in the Government’s ability to support these all-important scaling companies,” said Stuart Lucas, the co-chief executive officer of Asset Match.
“Having weakened its hand in the recent snap election, the Conservative Government must now provide bold and confident action to combat this,” he said.
A total of 60 per cent of those questioned in the survey said they were not confident the Government would help SMEs grow, while 62 per cent said that they felt the Government was favouring “new-age sectors” like fintech, over traditional industries such as construction and manufacturing.
Specifically, Mr Lucas said that Prime Minister Theresa May and the Brexit negotiating team must “demonstrate that they can make a success of the UK’s departure from the EU by enabling the private sector to seize the opportunities that are emerging”.
Immediately before June’s general election, a survey conducted by Hitachi Capital found that almost a third of small businesses were hoping for a new government that would reverse the Brexit decision entirely.
Among new and emerging businesses, Brexit has particularly evoked fears around trading tariffs and the free movement of people.
Figures published by The Federation of Small Businesses last month showed a drop in confidence among members for the first time since the aftermath of the referendum.
FSB national chairman Mike Cherry said at the time that small companies were “still reeling” from April’s business rates hike, and an accompanying noted said that labour costs and the tax burden were common concerns.
Operating costs for small businesses are now at their highest in four years, according to the FSB.