Barney Hussey-Yeo, Founder and CEO of Cleo talks about how a latest dialog concerning the firm’s IPO ought to sign worrying instances for the UK’s startup economic system.
Just lately, I met the Head of Funding Banking at a world financial institution to debate Cleo’s long-term future as a public firm. Your entire dialog assumed a US itemizing. Once I requested about London, they laughed.
As I’ve been vocal about just lately, this response completely encapsulates our problem. For a lot of on Wall Road, the concept of a UK tech champion selecting the London Inventory Trade is sort of unthinkable. That ought to fear us all.
A Declining Market
The Monetary Instances just lately reported that fundraising from IPOs in London has dropped to its lowest degree in at the least 30 years. Simply £160 million was raised within the first half of 2025, down 98 per cent from 2021’s highs and under post-financial disaster ranges.
These figures replicate London’s evolving position in international fairness markets. Britain’s tech sector continues to thrive, producing world-class corporations like DeepMind, Arm, and Clever. Nonetheless, many of those success tales are more and more wanting overseas for his or her listings. AstraZeneca, the UK’s largest listed firm, has explored a possible transfer to New York. Clever has shifted its major itemizing to the US. When corporations make these strikes, Britain misses out on jobs, tax revenues, and the chance to learn from tomorrow’s international winners.
Why The US Wins
It’s simple to see the Atlantic’s enchantment. Valuations are greater, the investor base deeper, and guidelines extra founder-friendly. The S&P 500 trades at a lot richer multiples than the FTSE 100, making fundraising extra engaging.
The US creates an surroundings that rewards progress. Founders can elevate vital capital whereas sustaining management by means of super-voting rights. Traders, from retail to institutional, are comfy backing high-growth corporations that will not but be worthwhile. The regulatory framework successfully balances disclosure necessities with operational flexibility.
A Second of Alternative
This development presents a possibility for change. Britain can select to reinforce its fairness markets to higher entice founders, buyers and next-generation corporations. This requires focused reforms applied with urgency. Ready till 2030, as some Mansion Home reforms counsel, means doubtlessly lacking alternatives whereas different monetary facilities advance their positions.
Listed here are 5 steps that may make a direct distinction:
- Abolish stamp responsibility on UK tech shares. With no main tech giants listed right here, income loss is negligible, however the sign could be highly effective.
- Speed up Mansion Home reforms. Unlocking pension fund capital for high-growth corporations can not wait one other 5 years.
- Launch tech ISAs. Give savers the chance to spend money on progress champions somewhat than conventional financial savings merchandise, creating wealth for strange households whereas supporting innovation.
- Provide 0% capital beneficial properties for founders itemizing within the UK. Make it extra engaging than going overseas.
- Replace itemizing guidelines to outcompete the US. Permit super-voting rights, introduce versatile disclosure regimes, and make London the best place globally to take a progress firm public.
The Stakes
These modifications would require minimal Treasury assets whereas sending a robust message: Britain is dedicated to remaining a world monetary middle and supporting its innovators. Extra importantly, they’d assist be sure that when British pensioners and ISA holders make investments, they’ll take part within the success of British corporations somewhat than seeing that worth creation occur elsewhere.
With considerate reforms, London can strengthen its place as a pure dwelling for bold, world-class companies. Britain has the expertise, concepts and entrepreneurial power. The chance is there to construct on these strengths.
That’s a future value selecting.
