Why the UK Has a Poor Record of Successful Technology Innovation

Originally posted 02/07/10

It is widely recognised that the UK has a great record of developing new technologies — particularly at its world-leading universities like Cambridge and Oxford — but a poor record of turning that technology into great companies, by comparison to the United States, China, Germany and Israel to name a few.  Of course, there are exceptions like Vodafone, ARM, Autonomy and others.  There is no single cause for this problem.  Here are a few that contribute:

• lack of a concentration of talent and resources for entrepreneurs (like in Silicon Valley) — the Cambridge region is the closest thing, but is too small and operates too independently of other nearby centres of excellence such as the Oxford and Thames Valley regions;
• lack of an entrepreneurial culture that excuses failure, and serial failure;
• insufficient sources of seed funding and venture capital, at least by comparison to the United States;
• tendency of entrepreneurs to sell out when their companies are big enough to make them rich, rather than waiting until they are world leaders;
• too small a domestic economy (related to the previous point); and
• tendency towards “me too” thinking — the reasonably vibrant London entrepreneurial community has too many people trying to build a new social network (or something like that), compared to those who are truly thinking “out of the box”.