A glimpse into London Tech Week and the city's burgeoning tech scene.
S1E17 | Highlights and impact of this week's top tech themes.
Hi, Friends —
✰ Welcome to [our digital disco]! Keep scrolling for this week’s key themes in tech news and other misc. thoughts (Snack Time). You can also check out last week’s newsletter here.
☞ London Tech Week sheds light on the city’s burgeoning tech scene.
London is looking to supercharge its tech economy — and is making big jumps to lure the top talent and investment needed to compete with Silicon Valley. Last week brought about London Tech Week, a series that brings together global leaders to speak about tech, innovation, and impact. The event was attended by several high-profile individuals, including Prime Minister Rishi Sunak, the Malaysian Minister of Communications and Digital, and Ukraine's Deputy Minister for Digital Transformation.
Why does it matter? The U.K. is proving attractive due to the capital’s strong ecosystem, lower valuations for companies, and access to European markets. These factors can drive a higher success rate of startups, and help investors get more value for their money. The U.K. government is also working hard to fuel the larger economy through initiatives such as funding high-potential businesses and backing local development projects.
Pros: London has seen an enormous increase in the U.K. tech industry in recent years, with more entrepreneurs, start-ups, and capital than ever before. London's tech ecosystem has grown from $70B in 2014 to roughly $621B in 2023, and has produced over 100 unicorns (startups valued over $1B). The city has also attracted over 1,700 tech foreign direct investment projects, with a record £10.6B in U.S. venture capitalist investments in 2021.
Cons: London still faces many challenges in attracting competitive companies and funding. Despite the tech sector’s growth in the past decade, British tech firms often get acquired by overseas competitors, or chose to list on the U.S. Nasdaq rather than the London Stock Exchange. The U.K. has a history of struggling to attract big-name tech companies due to regulatory requirements and limited liquidity (making it harder for startups to gain access to capital and potentially discouraging investors). While the government revised U.K. listing rules to encourage more tech listings, many entrepreneurs and investors still prefer to exit in the U.S. or other stock exchanges.
☞ The U.K. government seeks to lead the future of AI regulation.
Speaking at London Tech Week, U.K. Prime Minister Rishi Sunak highlighted his aim “to make the UK not just the intellectual home, but the geographical home of global AI safety regulation.” Most notably, Google DeepMind, OpenAI, and Anthropic all agreed to provide the U.K. government with access to their AI models for research and safety purposes. Sunak both expressed enthusiasm about the transformative power of AI in various sectors, such as education and healthcare, and emphasized the need for safety precautions.
Why does it matter? The agreement among the leading AI companies and the U.K. government marks a significant step in the country's ambition to lead in AI regulation and innovation. Moreover, the U.K. government expressed its plans for a forthcoming AI safety summit and the establishment of a Foundation Model Taskforce with £100M in funding. The success of the U.K.’s goals will depend on striking the right balance between innovation and regulation, addressing concerns around AI ethics, and providing clear and effective pathways to ensure the responsible development and deployment of AI.The UK already houses some of the world's largest foundation model labs (including almost all of Google's AI business through DeepMind). OpenAI and Anthropic recently opened their European headquarters in London, while Palantir announced plans to set up research hubs in the U.K. In addition to AI, Sunak highlighted other key areas for tech investment and innovation, including quantum, synthetic biology, and semiconductors.
Pros: Granting access to AI models for research and safety purposes allows the U.K. government to deepen its understanding of AI's potential and risks. It enables policymakers to make informed decisions and develop regulations that strike a balance between innovation and safety. Additionally, hosting a global summit on AI safety demonstrates the U.K.'s commitment to international collaboration and leadership in shaping global AI governance.
Cons: The absence of specific regulatory proposals at this stage leaves room for uncertainty and ambiguity, which could hinder the clarity and effectiveness of future regulations. Moreover, only time will tell whether Prime Minister Sunak’s bold comments prove true. Sunak’s £54M investment in developing secure and trustworthy AI research, for example, may fall wildly short of what is necessary to influence AI developments. This amount is only half of what OpenAI spent on training GPT-4, which powers the paid-for version of ChatGPT.
☞ Other highlights:
Microsoft's sudden dominance in AI has caught Silicon Valley off guard.While OpenAI's ChatGPT has received much attention, it is Microsoft that quietly owns the mega-computers that enable ChatGPT to function. Since 2019, Microsoft has invested $13B in OpenAI. Its share price has also risen 30% since the arrival of ChatGPT. Analysts estimate that Microsoft's revenue from OpenAI-powered features could hit $99 billion by 2027. This has led some to view Microsoft as the AI tech giant unlikely to be beaten, having cornered the emerging software market and preparing to cash in.Microsoft's partnership with OpenAI is unique in the tech industry. Instead of absorbing OpenAI and its technology, Microsoft has provided financial backing while allowing OpenAI to explore other partnerships. This unconventional partnership could face challenges, however, as both companies offer similar software and services and will compete for profit.
The U.S. Coast Guard is searching for a submersible craft carrying five people, which has been missing since Sunday. The submersible failed to return from a dive to visit the wreck of the Titanic on the Atlantic Ocean floor. OceanGate, the company leading the expedition, is a private firm that aims to increase access to deep-ocean exploration. The company has made headlines in recent years by organizing expeditions for paying tourists to travel in submersibles to shipwrecks, including the Titanic, and to underwater canyons.
Snacktime
📓 Reading: Douglas Rushkoff’s Survival of the Richest: Escape Fantasies of the Tech Billionaires. The book dives into the tech elite’s wishes and the explosion of inequality largely driven by this industry.
♬ Listening to: Zoe Weinberg: On the Future of Informational Democracy. Zoe is fantastic. This episode was hosted by Matthew Putnam’s Utility + Function podcast.
✰ Thinking about: The fact that we are well-past the halfway point of 2023… and what this means for my goals, relationships, and career. It’s a reminder to take stock, reassess, keep pushing forward — and practice gratitude.
✿ As always — any and all feedback is welcome! In the meantime, give someone a hug and say an ‘I love you’ this week. Make the world a little happier.
I'm not terribly stoked for Sunak, but he makes Johnson look like.... well, Johnson. Rishi is a much better person to have at the helm during an AI revoluiton.