Britain selling startups too early

A prominent UK angel investor, Simon Thorpe, founder of Delta2020 and ex-chair of Cambridge Angels, cautions that Britain’s top tech firms are being sold prematurely, allowing foreign buyers to reap the rewards. With over 60 startups backed and 14 exits, only one sale went to a UK buyer. Thorpe, who has supported firms like SwiftKey and Spectral Edge, highlights the trend of overseas acquirers valuing UK talent and innovation over immediate revenue.

Speaking on the SyndicateRoom podcast Angel Insights, Thorpe said, “Sadly, yes, we are selling our companies too early… We are good at startups in the UK. We’re not so good at scale-ups.” He explained that overseas acquirers often see British companies as valuable for their people and technology, not just their revenue. He cited Apple’s 2019 purchase of Spectral Edge, a UK image-processing firm he backed, as an example where “they wanted the technology and the people.”

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The pattern is also visible in growth funding. Quantexa, a London data analytics company, raised a $175m Series F in 2025 led by the venture arm of Ontario Teachers’ Pension Plan. Thorpe noted that UK pension funds lack the expertise to back growth companies after years of focusing on income. While he welcomes recent Mansion House pension reforms, he points out they will take time to implement.

To help companies scale without selling early, Thorpe argues the UK needs more sources of capital that can buy out early investors and fund the next stage. He suggests four options:

• Venture capital trusts. VCT income tax relief fell from 30% to 20% in April 2026, though the same Budget doubled the amount companies can raise under EIS and VCT.
• Secondaries. Dedicated secondary funds and the new PISCES framework for trading private-company shares can let founders sell enough to “at least pay off their mortgage,” helping them stay and build.
• Venture debt. Thorpe chairs a venture debt investment committee at Salica Investments.
• IP-backed loans. Lenders like NatWest now use valuations from Inngot, one of his portfolio companies, to lend against intellectual property. A company might borrow 40 to 50% of its IP’s value.

On national strategy, Thorpe contrasts the UK’s £1bn commitment over a decade for AI and semiconductors with the roughly $52bn from the US CHIPS Act. The UK figure, he says, “is certainly more than a billion. And we are not ambitious enough.” He believes Britain should collaborate with major European economies and focus on areas of genuine strength.

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Thorpe sees angel investors as the scouts of the system: “seeking out these great little nuggets of great people and great tech, and helping them get on the ladder… and pass the baton on to institutional funding.”

Tom Britton, co-founder of SyndicateRoom and host of Angel Insights, added, “Simon’s record makes the point better than any statistic: when British companies sell, they mostly sell abroad. Exits are good news for founders and investors. What the UK needs is enough capital in the room that founders get a real choice about when to sell.”