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Well, the nerds aren't the super rich here. It's still about public schools and old money and people who studied law or the classics or at least graduated from

by t43562 4y ago

Well, the nerds aren't the super rich here. It's still about public schools and old money and people who studied law or the classics or at least graduated from Oxbridge. The big money in software is all from the world of finance and there's nothing tech about them - no heart or vision except how to make a faster trade. So who will foster a company that's not going to make money for 10 years? I think there's also an attitude here that "having failed ever" is a black mark against a person. We really need to believe that experience is helpful and that would require some kind of cultural/personality change which I think are difficult. Occado is potentially interesting - a lot of technology there - but it has had a lot of the "praise and then trash" kind of attention and it probably just needs to invest a lot more. Arrival is another interesting one which might or might not make it but we should be hoping that it does and trying hard to enable it.

Veen 4y ago
> The nerds aren't super-rich here. It's still about public schools and old money and people who studied law or the classics At tech companies? I think not.
- DoughnutHole 4y ago
  I don't think he's talking about tech employees - he's talking about capitalists. The tech industry in the US is mature enough that there plenty of "rich nerds" who made their fortune in the early days of the industry and today invest in tech startups. Hardly anyone with the money to jumpstart a startup in the UK has any interest or involvement in tech as an industry. The capitalist class in the UK is very old and very established, and likes to invest in old and established industries. If they're not just passively extracting rent from their assets they might go as far as to let their friends in the city play with more interesting financial instruments. Pumping money into different probably doomed startups in the hope that they'll land a unicorn isn't really their style.
  - origin_path 4y ago
    I'm not sure that's true. There are quite a few venture capital firms in the UK that invest in the software world. The problem is more that, especially in the past 10 years or so, the sheer number of failures you need to absorb in order to get one success seems out of whack to the historical norm. The VC firms in the UK and rest of Europe (really, everywhere that's not California) can only afford relatively small investments for relatively large chunks of equity. To get VC firms on the scale of a16z or YC you need to have at least one mega hit, ideally several, and then you make big investments in hundreds of ropey startups in the hope that another one comes good. That's the US approach. The UK hasn't had an equivalent of a Google or Netscape that could kickstart whole new VC funds. The past 10 years feels especially poor for non-US VC because so much money flooded into the market that there are dozens of venture backed "tech firms" for every obvious idea, so companies outside the US just get outspent into oblivion. How on earth would a UK firm have competed against Uber for example? The sums of money burned were astronomical. Blockchain firms also sucked up vast amounts of talent and capital in the UK due to its adjacency to finance, but with relatively little to show for it all. It feels like in the era where the big US funds were made, companies were risky but still on a reasonable scale. Google/Facebook etc became profitable within a small number of years. You didn't get funds willing to pump money into firms for a decade+ with no ROI in sight.
    - t43562 4y ago
      I think this just means that the UK VCs are far far far too late. And they're late for some reason - it doesn't take insight to follow a well established trend.
jimnotgym 4y ago
All true. VC's in the UK only share the name of their US cousins. They invest in established business. They are full of the orthodoxy expected of a bunch of ex-big 4 accountants that went to expensive schools. A startup in the UK is a son of a rich man who wants to set up doing whatever, and leverages their Old Boys network to get customers. Banks are so risk averse that it is laughable.
- ClumsyPilot 4y ago
  The idea that you could raise money based on a powerpoint presentation, like Dropbox did, is laughable in UK. The investment culture is hard to describe with a word other than cowardly.
kypro 4y ago
Yes, you're completely right. Not that I'm in favour of the wealth inequality in the US, but in some ways it's one of the US's biggest assets. There are a lot of people in the US who are so excessively wealthy they're willing to throw money at moon-shot companies (and sometimes simply ideas) that will almost certainly never yield them a return. You don't get companies like Space X and Blue Origin without extremely ambitious and extremely wealthy individuals and the US has a large amount of both. In the UK people are generally far more conservative both with their ambitions and with their investments. We do have innovative tech companies here, but they're far less ambitions than those you'd typically find in the US. Things like food delivery, customisable greeting cards, accounting services, etc. I think to a lesser extent there are geographical, demographical and regulatory advantages to starting tech companies in the the US too. In the UK employers have provide paid holiday, maternity leave, and pay national insurance contributions for everyone they employee. This isn't a huge issue if your a profitable company, but things like this add up if you're trying to bootstrap a company with a limited amount of VC money. Similarly, we can't scale as easily because of our geographical and demographical limitations. Europe isn't as easy to scale into for various geographic and cultural reasons and the UK as a domestic market is far smaller than the US. While nothing I've said makes it impossible for the UK to create a tech giant, it does stack the odds against us. And just based on relative population size we're already 5 times less likely to create a tech giant when compared to the US.
- prottog 4y ago
  I'm in favor of a system of free(ish) markets operating well, with big fortunes made from value creation and not rent-seeking behavior. If that results in wealth inequality, so be it; the old idea that a rising tide lifts all boats has not been invalidated yet.
  - kypro 4y ago
    I agree, but I think a lot of people would argue the rising tide in the US doesn't come anywhere near to lifting all boats. If you're smart and educated then US is an incredible place to live and work. If you're not then life in the US seems quite harsh by Northern European standards.
scyzoryk_xyz 4y ago
I just interviewed at Ocado and I agree that it looks like they have it together. But then they’re outsourcing a chunk of the software to my country so not sure if that reflects well on the UK. Another one worth mentioning a bit closer to my field is CMR - a surgical robotics company. They’re blowing enormous capital trying to conquer Europe and it might be working. Their tech is convincing and they have good showmanship. If it works out that’s an enormous market. But it’s not visionary - just building on many incremental improvements and respectful of the thorough research and validation required. My external (optimistic) view is that this is something that is given a bit more respect in UK culture. Something about strong educational institutions and empirical reasoned thinking. But then maybe it’s just my POV?
- robocat 4y ago
  > But it’s not visionary - just building on many incremental improvements and respectful of the thorough research and validation required That is the core idea of most successful businesses. The same thing done very quickly is called a startup. “Visionary” is for government pork barrels, or wealthy investors that want to gamble or gain status, with the most likely outcome of becoming less wealthy. I think building a successful business is best achieved by a series of smaller steps, with each step up-and-to-the-right. Visionary businesses that have a single wallface/cliff to climb have a horrific level of failure.
  - scyzoryk_xyz 4y ago
    True - my point being that some of these UK companies are tackling more complex problems by methodically breaking them down.

by t43562 4y ago

Veen 4y ago

> The nerds aren't super-rich here. It's still about public schools and old money and people who studied law or the classics At tech companies? I think not.

DoughnutHole 4y ago
I don't think he's talking about tech employees - he's talking about capitalists. The tech industry in the US is mature enough that there plenty of "rich nerds" who made their fortune in the early days of the industry and today invest in tech startups. Hardly anyone with the money to jumpstart a startup in the UK has any interest or involvement in tech as an industry. The capitalist class in the UK is very old and very established, and likes to invest in old and established industries. If they're not just passively extracting rent from their assets they might go as far as to let their friends in the city play with more interesting financial instruments. Pumping money into different probably doomed startups in the hope that they'll land a unicorn isn't really their style.
- origin_path 4y ago
  I'm not sure that's true. There are quite a few venture capital firms in the UK that invest in the software world. The problem is more that, especially in the past 10 years or so, the sheer number of failures you need to absorb in order to get one success seems out of whack to the historical norm. The VC firms in the UK and rest of Europe (really, everywhere that's not California) can only afford relatively small investments for relatively large chunks of equity. To get VC firms on the scale of a16z or YC you need to have at least one mega hit, ideally several, and then you make big investments in hundreds of ropey startups in the hope that another one comes good. That's the US approach. The UK hasn't had an equivalent of a Google or Netscape that could kickstart whole new VC funds. The past 10 years feels especially poor for non-US VC because so much money flooded into the market that there are dozens of venture backed "tech firms" for every obvious idea, so companies outside the US just get outspent into oblivion. How on earth would a UK firm have competed against Uber for example? The sums of money burned were astronomical. Blockchain firms also sucked up vast amounts of talent and capital in the UK due to its adjacency to finance, but with relatively little to show for it all. It feels like in the era where the big US funds were made, companies were risky but still on a reasonable scale. Google/Facebook etc became profitable within a small number of years. You didn't get funds willing to pump money into firms for a decade+ with no ROI in sight.
  - t43562 4y ago
    I think this just means that the UK VCs are far far far too late. And they're late for some reason - it doesn't take insight to follow a well established trend.

jimnotgym 4y ago

All true. VC's in the UK only share the name of their US cousins. They invest in established business. They are full of the orthodoxy expected of a bunch of ex-big 4 accountants that went to expensive schools. A startup in the UK is a son of a rich man who wants to set up doing whatever, and leverages their Old Boys network to get customers. Banks are so risk averse that it is laughable.

ClumsyPilot 4y ago
The idea that you could raise money based on a powerpoint presentation, like Dropbox did, is laughable in UK. The investment culture is hard to describe with a word other than cowardly.

kypro 4y ago

Yes, you're completely right. Not that I'm in favour of the wealth inequality in the US, but in some ways it's one of the US's biggest assets. There are a lot of people in the US who are so excessively wealthy they're willing to throw money at moon-shot companies (and sometimes simply ideas) that will almost certainly never yield them a return. You don't get companies like Space X and Blue Origin without extremely ambitious and extremely wealthy individuals and the US has a large amount of both. In the UK people are generally far more conservative both with their ambitions and with their investments. We do have innovative tech companies here, but they're far less ambitions than those you'd typically find in the US. Things like food delivery, customisable greeting cards, accounting services, etc. I think to a lesser extent there are geographical, demographical and regulatory advantages to starting tech companies in the the US too. In the UK employers have provide paid holiday, maternity leave, and pay national insurance contributions for everyone they employee. This isn't a huge issue if your a profitable company, but things like this add up if you're trying to bootstrap a company with a limited amount of VC money. Similarly, we can't scale as easily because of our geographical and demographical limitations. Europe isn't as easy to scale into for various geographic and cultural reasons and the UK as a domestic market is far smaller than the US. While nothing I've said makes it impossible for the UK to create a tech giant, it does stack the odds against us. And just based on relative population size we're already 5 times less likely to create a tech giant when compared to the US.

prottog 4y ago
I'm in favor of a system of free(ish) markets operating well, with big fortunes made from value creation and not rent-seeking behavior. If that results in wealth inequality, so be it; the old idea that a rising tide lifts all boats has not been invalidated yet.
- kypro 4y ago
  I agree, but I think a lot of people would argue the rising tide in the US doesn't come anywhere near to lifting all boats. If you're smart and educated then US is an incredible place to live and work. If you're not then life in the US seems quite harsh by Northern European standards.

scyzoryk_xyz 4y ago

I just interviewed at Ocado and I agree that it looks like they have it together. But then they’re outsourcing a chunk of the software to my country so not sure if that reflects well on the UK. Another one worth mentioning a bit closer to my field is CMR - a surgical robotics company. They’re blowing enormous capital trying to conquer Europe and it might be working. Their tech is convincing and they have good showmanship. If it works out that’s an enormous market. But it’s not visionary - just building on many incremental improvements and respectful of the thorough research and validation required. My external (optimistic) view is that this is something that is given a bit more respect in UK culture. Something about strong educational institutions and empirical reasoned thinking. But then maybe it’s just my POV?

robocat 4y ago
> But it’s not visionary - just building on many incremental improvements and respectful of the thorough research and validation required That is the core idea of most successful businesses. The same thing done very quickly is called a startup. “Visionary” is for government pork barrels, or wealthy investors that want to gamble or gain status, with the most likely outcome of becoming less wealthy. I think building a successful business is best achieved by a series of smaller steps, with each step up-and-to-the-right. Visionary businesses that have a single wallface/cliff to climb have a horrific level of failure.
- scyzoryk_xyz 4y ago
  True - my point being that some of these UK companies are tackling more complex problems by methodically breaking them down.