UK startups plan to hire as business optimism rises

Nearly 90 per cent of UK startups are planning to hire new talent in 2020, as Brexit-related political uncertainty clears and business confidence rises.

A study of 1,100 founders of tech and healthcare startups in the UK, North America and China for Silicon Valley Bank, found that a majority (57 per cent) thought business conditions would improve in the coming year, compared to 47 per cent in 2019. Within that total, 86 per cent of UK companies said they were planning to hire.

However, despite rising optimism, 37 per cent of startups said the process of raising capital was getting harder, while 58 per cent admitted that their realistic long-term goal was to be acquired rather than going public.

Access to talent was highlighted as the most important challenges for 79 per cent of companies, with 45 per cent saying it was becoming more difficult to hire skilled staff.

Meanwhile, ensuring smooth international trade was the most important public policy issues for 45 per cent of those asked. Secondary concerns included cyber security and consumer privacy (both at 29 per cent), along with corporate taxes and international trade (both at 26 per cent).

When it comes to diversity, 43 per cent of startups now have at least one female c-suite executive, and 42 per cent have at least one female board member, while 42 per cent of startups have at least one c-suite executive who is ethnically or racially diverse and 44 per cent have at least one board member who is ethnically or racially diverse.

Greg Becker, chief executive of Silicon Valley Bank, said: “The 2020 results underscore a few key themes - there’s rarely been a better time to be an entrepreneur – two thirds of the startups we surveyed are optimistic about improving business conditions, almost all are planning to hire, and most of those who are attempting to raise capital report they are successful.

“We know economic and political events are hard to predict, especially how they may affect access to capital and the skilled talent needed to fuel growth,” he continued, adding: “Still, startup founders and innovators are resilient – survey results of the last three years generally describe a steady level of confidence, even in the face of continuous market shifts.”

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