Across the world there are approximately 342 unicorn companies, with 17 of these being in the UK. For anyone who thought a unicorn was just a mythical creature and the national animal of Scotland, it is also the term used for privately owned start-up companies valued at US $1bn or above. 

With a seemingly exponential rise in the use of technology in daily life, it is almost unsurprising that there is a huge amount to be made in the digital tech sector. Looking at the commercial success of companies such as Skyscanner will tell you this. From the moment we wake up in the morning we use digital tech to go about our daily lives. Need to get to work? Order an Uber. Need a coffee on the way to the office? Order online in advance. Need to buy a gift on your lunch break? Shop it online and order an UberEats for lunch at the same time. Going on holiday? Check the best flight and hotel prices online.

However, for all of this innovation to continue to grow at pace, we need to continue to develop a healthy ecosystem of tech and start-up companies that represent and foster that hunger for growth and success. Aside from available investment funding and an environment that encourages entrepreneurship, digital skills are absolutely paramount to the success of any start-up.

According to a study by Octopus Investments, in 2017, 20% of new jobs in the UK economy were generated by start-up companies. However, 90% of start-ups have stated they face skills shortages in the UK economy. This is a worrying issue as companies cannot grow and develop new technologies if there isn’t locally available talent. This is when many start-ups look to more digitally mature economies such as the US and China to recruit the talent they need.

These economies are producing talent with the right level of digital skills, and experience of scale-up growth, flexibility & pace. From seasoned workers to ambitious graduates, companies in the tech sector are looking internationally to recruit the right talent that will allow their companies grow in the right direction.

In terms of the numbers involved, they are miniscule in relative terms to the wider UK workforce. In 2017 the number of Tier 1 visas for those with “exceptional” talent was doubled, but only from 1,000 to 2,000. In 2018 healthcare workers were excluded from the numbers for Tier 2 visas, effectively allowing an additional 8,000 visas to be issued. However, both of these types of visas are not exclusively for those in the tech sector. They are shared with lots of other workers who are also in high demand. There is a tech specific visa, however the number of visas being issued has fallen, in tandem with a high rejection rate.

In a post-Brexit world there is an agitation that it will become even more difficult to recruit talent, with the freedom of movement of EEA nationals restricted. The UK Government have set out their White Paper on the UK immigration system and this sparks a discussion for creating a system that could hopefully address the current recruitment barriers for start-ups.

Some quarters have floated the idea of a “unicorn visa” however this might be seen as only addressing the international recruitment issues of the niche unicorn companies and not those of the early start-ups that need the talent now to foster their growth.

It might be seen as ironic that with so much technology, allowing people across the world to collaborate remotely in real-time, there is a strong desire to have people physically coalesce. However, there are drawbacks to remote working, such as limited creativity, lack of team bonding and practical issues such as managing salaries and renumeration. The complexities involved in having singular people working across multiple international territories could become financially and practically onerous.

In periods of fast growth, tech companies need to be as agile as possible and be free to focus on driving forward, not caught up in red tape and recruitment headaches. There is an increasing demand right across the business spectrum for digitally skilled people. It’s a huge demand and it’s a here and now issue.

Next steps:

If you want to talk more about the challenges of recruiting or retaining talent, and the impact on your business growth, please get in touch with me or a member of our Technology & Life Sciences team.