Brexit: It’s Impact On Startups & Young Entrepreneurs
There’s no doubt that the UK population’s vote to leave the EU caused seismic shock amid the business community.
But now that talks have started to thrash out the Brexit divorce bill and the dust has settled, it’s clear to see that the nation’s start-ups and entrepreneurs have been hard at work digesting the many implications.
Read on to find out what the impact of Brexit really means if you’re trying to grow a business or thinking of launching a new enterprise as the withdrawal commences.
Impact 1: Higher cost of doing business
Brexit has led to massive fluctuations in exchange rates.
Immediately after the vote, the pound fell to a record low and it’s struggled to recover fully in the months since.
Even long established businesses have struggled but what of start-ups and entrepreneurs?
Those who import goods have faced rising costs and for new businesses already operating on a tight budget, conditions have been tough.
Likewise for entrepreneurs who travel overseas, the weaker pound has made life much more expensive.
Impact 2: Conditions have been tougher in some industries
Entrepreneurs in certain industries will have found that Brexit has derailed some deals.
Some property entrepreneurs report tough conditions with a lack of investment but one cosmetics firm said it had sold £300,000 of face cream to French customers in one day when the pound fell because it made the product so much cheaper for overseas buyers.
Impact 3: Workforce flux
There has been a lot of uncertainty surrounding EU workers currently employed in the UK.
For firms who rely on top talent from overseas, there’s been lots of sleepless nights.
The challenging Brexit landscape and pervading uncertainty means that some firms – such as tech companies – have struggled to recruit and retain the foreign workers they need to keep their organisations at the cutting edge.
It may be even harder in the future to recruit needed skills from Europe.
On the flip side, some entrepreneurs and start-ups could capitalise, especially if it means easier access to leading minds from non-EU countries such as America and Australia.
This is good news for those working in sectors such as technology, IT and marketing.
Impact 4: There’s greater caution from investors
While the realities of Brexit are still very much an unknown, startups seeking funding are finding it a bit harder to pin down investors.
There is a mood of caution, with figures showing investors are more likely to now hedge their bets and invest multiple smaller amounts across a number of operations, rather than consolidate a single big investment.
That means entrepreneurs might find it harder if they are truly pushing the envelope and searching for investors for a ‘riskier’ proposition but, smaller firms should still find that opportunity does exist.