Tech Nation forced to sell assets after UK funding withdrew

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Tech Nation, the British group once touted as key to efforts to create a UK start-up scene to rival Silicon Valley, was forced to burn off its remaining assets after Rishi Sunak’s government terminated its its funding.

The group was formed by the government in 2014 to boost the UK’s tech industry through “growth schemes” for start-ups and visa processing for overseas staff. A third of the UK’s tech ‘unicorns’ have since gone through its development programs, including Deliveroo, Monzo and Revolut.

But last month the government withdrew a £12million grant to the group, instead giving the money to Barclays Bank, forcing Tech Nation to close.

The move came just months after Tech Nation considered, but ultimately rejected, lucrative deals with Middle Eastern governments, according to two people with knowledge of the deals and a company document seen by the Financial Times.

Without any outside funding, business groups and technology organizations were invited to bid on its intellectual property and other assets before the February 14 deadline. The sale includes brands like Future Fifty, a late-stage tech start-up support program,

According to people familiar with the process, Founders Forum, the networking group for entrepreneurs started by lastminute.com founder Brent Hoberman, is among more than 30 organizations to express interest in bidding on certain assets. Some groups, like the London Business School, considered offers but decided not to pursue.

Tech Nation’s demise comes after its funding has dwindled in recent years, chief executive Gerard Grech told the FT, and despite the government’s stated ambitions to build a “science superpower”.

“I am on [Barclays] will do their best with the grant,” Grech said. “I just think whatever the government says, they need to match their own rhetoric with policies and support mechanisms that really, really help the ecosystem.”

Funding shortfalls led Tech Nation to explore other options to bridge a £6m funding gap before announcing its closure.

In the autumn of last year, he came close to signing a £2.63million deal with the Saudi government to support future Saudi unicorns, and another £2million deal focused on supporting future Saudi unicorns. research-intensive “deep tech” companies, according to a company document seen by the FT.

It has also engaged with the government of Dubai on a £500,000 proposal to help UK businesses and venture capital firms expand in the Middle East, the document said. The governments of Dubai and Saudi Arabia did not respond to requests for comment.

“We made the decision not to [proceed with the contracts] because we were focused on the UK tech ecosystem,” Grech said.

He added that efforts to secure alternative funding from the private sector failed, while an offer to become a public body and move to government control was rejected.

Tech Nation will continue to run a visa processing program for technology employees on behalf of the UK Home Office until the end of March.

Tech groups, including lobby group Coadec, are in preliminary talks with the Home Office on how to move the visa program forward. The Home Office said apps would be “unaffected” while it explores “long-term changes” to the scheme.

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