What UK policy-makers need to learn from Arm’s listing on the US stock exchange
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The UK needs to focus on supporting companies in a range of diverse sectors, writes MIT professor Fiona E. Murray.
UK technology giant Arm has announced it will pursue a sole US listing, after years of drama and uncertainty surrounding the company’s future. It is serving as a microcosm for changing attitudes towards globalism, especially when it relates to science and technology.
It has been called a blow and a rebuff to London after many efforts to have Arm list on the UK exchange. The decision forces UK policy-makers to rethink how we create policies to support the starting, building and scaling of tech companies.
One lesson is that the UK government needs to continue to create policies that support scaling up strategically important start-ups which support the country’s wider agenda as a dynamic economy that builds on its strong scientific traditions, rather than ‘strong Arming’ one company to list in London as part of its core agenda, however important a company like Arm may be.
dual-class share structures are exactly what the UK government needs to create an ecosystem which scales more home-grown technology companies
UK prime minister Rishi Sunak’s advocacy for founders and investors to have more control through dual-class share structures is exactly what the UK government needs to create an ecosystem which scales more home-grown technology companies that want to list in London, on a stock market too long dominated by financial companies and slow-growing sectors.
The UK needs to focus on supporting companies in a range of diverse sectors — from semiconductors and chips to climate tech and life sciences — which often require significant amounts of patient capital and committed investors.
Policy-makers and citizen activists need to remember that companies like Arm benefited from decades of globalist policies. Arm’s partnerships with multinational organisations and overseas expansion to markets like the US helped it become the player it is today.
As the pendulum continues to swing away from globalism, policy-makers, investors, and citizens need to be careful. Protecting and decoupling technology from our adversaries makes sense. But protecting and decoupling technology from our allies will stifle innovation in the long run.
Finding the right balance will be incredibly difficult and will require policy-makers to ask themselves questions like: when and in what context does technology sovereignty matter? How should technology sovereignty be constructed with allies?
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The UK could and should view Arm’s story as one of tremendous success for UK science and the entrepreneurial transformation of technological advantage into a successful global company.
Arm created an innovative business model; it was supported by UK and US capital; it took advantage of a global era in competition to expand and become a key player (with offices in the US and Tokyo when it was only four years old). The cleverness and tenacity at the core of the company is undeniably British.
As the UK forges ahead into a new era, it should learn from Arm, but not fixate on it in the wake of this recent news. Policy-makers should use the lessons learned to fuel debates on how we create, grow and scale companies that want to list in London, and determine where we draw the line with tech sovereignty.
Fiona E. Murray is the associate dean of innovation and inclusion at the MIT School of Management and the William Porter (1967) professor of entrepreneurship. She is the co-director of MIT’s Innovation Initiative and faculty director of the MIT Legatum Center for Entrepreneurship and Development.
She serves on the UK Prime Minister’s Council on Science and Technology and is also a member of the Ministry of Defence Innovation Advisory Panel and the European Innovation Council Joint Expert Group.
