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Tech founders and investors gave a mixed response to the government's Autumn Budget. Several said it contained useful signals for the UK technology sector but fell short on growth funding for scaling businesses.
Reaction focused on measures for artificial intelligence, founder tax relief and regional investment. Commentators welcomed fresh backing for sovereign AI and support for commercialising research, but questioned whether the Budget would do enough to keep high-growth companies in Britain.
Measures highlighted by the sector included an additional £140m for SovereignAI, support tied to a Data Centre Covenant, a 10 per cent Founder's Relief on eligible gains up to £10m, and funding linked to university research and industrial AI.
Founder relief
Guy Remond, Co-founder of Manchester-based EHE Venture Studio, said the return of a lower capital gains tax rate for some founders recognised the personal and financial strain of building businesses. He said the change could strengthen the case for entrepreneurs to remain in the UK and reinvest after an exit.
"There was some welcome news in the Budget, particularly the government's continued recognition that AI will play a major role in Britain's economic future. The additional £140m for SovereignAI and the proposed Data Centre Covenant are positive steps. If Britain wants to compete internationally and control these key technologies within its borders, it needs the infrastructure to support that ambition. And it is right that the communities hosting these facilities should benefit from the investment.
"I was also pleased to see the introduction of Founder's Relief. It is a welcome token gesture. Having spent much of my career building and investing in businesses, I know the personal risks involved, beyond simply giving up a salary, as the chancellor highlighted. He did not mention the other sacrifices: the punishing hours often required to build a business, time lost with family, and the financial risks often taken through savings or personally secured credit.
"The reinstatement of the 10 per cent capital gains tax rate on eligible gains of up to £10m recognises that risk and, importantly, gives successful entrepreneurs another reason to stay in Britain and reinvest. That is a welcome reversal in my view, but there is an opportunity to go further.
"We should not measure the success of Britain's AI strategy solely by how much infrastructure we build or how much public money we commit. The real prize is creating an environment where British AI companies can start, attract investment, grow internationally and remain headquartered here.
"I am not convinced the measures in place will achieve that. In fact, they will not. We need to be much more business-friendly. The current government thinks it is, which is a worry. It is about the environment and culture we foster. We are a million miles away from that.
"We need to get capital to promising businesses earlier, particularly outside London, where access to investment remains uneven. At EHE, we see the quality of businesses being built across the north and beyond. The talent is there, and so is the ambition. We need to make sure the investment ecosystem can keep up.
"I would like to see the rhetoric translate into more British companies becoming global leaders, with the jobs, wealth and long-term economic value staying here too. Will this Budget achieve that? In short, no, it will not."
That view was echoed elsewhere in the sector. The main concern was not the direction of policy, but the amount of capital available once start-ups move beyond their earliest stages.
Capital gap
"The big question ahead of this Budget was whether the government would back the UK's £1.2tn tech sector at a time of global economic uncertainty and rising costs. There are some encouraging signs.
"The introduction of a 10 per cent Founders' Relief up to £10m, alongside plans to expand scale-up funding through the British Business Bank and National Wealth Fund, sends a positive signal to entrepreneurs and investors. Greater clarity on capital gains should also help give founders the confidence to build and grow businesses here in the UK.
"It was also encouraging to see recognition that innovation cannot be confined to London and the South East. Measures to support regional growth, from the new Data Centre Covenant to investment in physical and industrial AI through a further £60m for the Sovereign AI Fund, could help create the conditions for more businesses to develop and scale across the UK.
"The £25m for UKRI Venture Doctorates and proof-of-concept funding is also welcome, helping university research teams turn promising ideas into commercial opportunities. And using public procurement to create demand for British innovation is a practical way to help homegrown companies win customers and prove their technologies at scale.
"But the real test is whether we can get more capital flowing into ambitious British tech companies. We have talked for years about the need to unlock pension fund investment and close the funding gap facing businesses looking to scale. It is disappointing that this Budget did not go further in setting out a clear plan to turn those ambitions into action.
"If we want our best companies to compete globally, we need more institutional investors willing to back them through their next stage of growth. The UK has no shortage of entrepreneurial talent or promising tech businesses. What we need now is the capital and commercial opportunities to help them grow into global leaders from the UK, rather than look overseas for the funding they need.
"This Budget has made some positive steps, but the government must now turn its commitments into action and get investment flowing into the companies that will drive the next generation of UK tech success."
Russ Shaw CBE, Founder of Global Tech Advocates, pointed to pension fund reform and later-stage finance as unresolved issues. These have long been cited by founders and venture investors as weak points in the UK market, especially when companies seek larger rounds.
AI Security
Other investors focused on the Budget's AI package and the government's emphasis on domestic control, safety and procurement. That drew a more positive response from parts of the market with an interest in sovereign technology and public-sector demand.
"The Autumn Budget marks a major step in accelerating the UK's AI ecosystem. By committing an additional £140m for the Sovereign AI Unit, £120m for the AI Security Institute and £80m towards a new Sovereign AI R&D Procurement Scheme, the government is strengthening the UK's domestic AI capabilities while ensuring the technology is developed and deployed securely and responsibly.
"As AI becomes more deeply integrated into critical industries, building trust, reliability and resilience must go hand in hand with supporting homegrown innovation. The UK already has world-class AI founders, technologists and academics, who have proven track records of developing world-class resources, foundational IP and best practices. But this expertise remains largely untapped.
"By unlocking this potential and looking to its own leaders and experts in the field, the UK can reduce its reliance on Big Tech, protect its AI sovereignty and develop the secure, reliable AI capabilities that businesses and critical industries need. In doing so, it can foster an environment capable of producing high-impact, AI-led disruptors.
"The once-in-a-generation wealth creation opportunity that AI offers must be shared by UK start-ups, companies and investors. The challenge now is ensuring these commitments translate into meaningful opportunities for British innovators to develop, test and scale technologies that businesses can trust.
"Only by combining domestic expertise, investment and a commitment to reliable AI deployment can the UK realise its true AI potential."
Amy Nauiokas, Founder and Group Chief Executive of Anthemis, welcomed the emphasis on domestic AI capability, security and procurement.
The overall message to ministers was clear. Support for AI, research translation and founder taxation won approval in parts of the sector, but many still want a stronger plan for institutional investment and scale-up finance.