When the pandemic struck, many bricks-and-mortar retailers quickly launched online stores and began to process payments digitally for the first time. For many this was relatively straightforward, but for one London-based wig merchant, there was a problem. The company’s payment provider classed the wigs – made from real hair – as “human remains”, and spent months deliberating over whether it could process the payments.
“That’s how you make wigs,” says Noam Nevo, CEO and co-founder of SME payments platform Osu. “There’s no other way around it.” Osu – launched in early 2020 to help SMEs and freelancers excluded by traditional providers – was able to help the wigmaker, and many others, join the rapid switch to e-commerce.
//-->
At the moment, GDPR compliance is “gobbledegook” to most start-ups, says one tech founder. “We often have to fill in 50-page documents, which baffle serious IT professionals.”
The UK government is already looking at the viability of a “GDPR-lite” that would reduce the time and money spent on compliance, while still ensuring that the EU grants the UK the “adequacy” status that will enable data to flow between the two jurisdictions.
Writing in the Financial Times, the Culture Secretary Oliver Dowden highlighted the “real-life costs” of burdensome data regulation that has “hampered innovation and the improvement of public services, and prevented scientists from making new discoveries”. He added that taking a new British approach represents a “multi-billion-pound opportunity to boost trade in sectors where physical distance is no object”. Some £11bn in UK service exports has been lost, he claims, to the barriers to international data transfers created by GDPR.
[see also: How the EU’s naivety led to its vaccine debacle]
Aoife Sexton, chief privacy officer and chief of product innovation at start-up Truata, which provides privacy-enhanced data analytics, says British companies are still at risk of “privacy paralysis… Companies are still grappling with this conundrum of secondary use of data, and I think that is stymieing innovation because there’s a lot of confusion and uncertainty.”
Sexton adds that there is “a careful balancing act” between fast adoption of cutting-edge technologies and the adequacy status needed to handle the data of EU customers, but that good, proactive regulation would make this possible. “Where there is new tech emerging and where a lot of hard questions get asked in grey areas, there’s absolutely ample space there for a leading regulator to step forward.”
Investment in UK companies since the Brexit vote in 2016 suggests some confidence that Britain will continue to innovate. Last year, international investors pumped more than three times the capital they invested in 2016 into the UK according to data from Tech Nation. Start-ups say they have not struggled to find backing from domestic or international investors; both Osu and Ziglu raised early-stage funding in the past month.
//-->
Overall, there is a “really optimistic picture” for UK start-ups, despite the sector’s well-founded reservations about Brexit, says Coadec’s Hallas.
“The UK over the past five years has actually, if anything, cemented its place as the foremost technology ecosystem in Europe,” he says. “The very successful growth of the ecosystem has continued and there’s no signs of that abating.”
[related_companies]Content from our partners
