UK Sold 300 Tech Firms to Foreign Buyers in a Decade, Thinktank Warns

Britain sold 300 of its most valuable companies to foreign buyers, mostly American, over the past decade. That figure, calculated by the Financial Times, anchors a new attack on the UK venture capital industry published by the thinktank Common Wealth in a paper titled We Aren't the Champions. The paper's central provocation: what if British innovation were scaled up to serve social needs at home rather than the profits of US investors?

The stakes are considerable. The UK presents itself as a science and technology power, yet its most promising firms routinely change hands before they reach heavyweight size. The paper argues that as long as the UK remains subordinated to US cash, building startups into giants will be a sisyphean task.

What happened to DeepMind?

The paper's exhibit A is familiar. DeepMind, founded in London in 2010, went to Google just four years later. Britain's venture capitalists might respond that they are in it for themselves, not for building up British technology. That response, the authors contend, is precisely the problem: a system in which early exit is the rational strategy cannot also be a system that produces domestic champions.

The pattern extends far beyond a single company. Nils Peters and David Kampmann of the London School of Economics, whose research underpins the paper, document that US and European incumbents won big from the exits of the 38 biggest UK VC-backed technology firms between 2010 and 2023. Those firms included businesses at the forefront of AI, fintech and biotechnology — the three sectors Britain most often names as industrial priorities.

Is the problem really a lack of capital?

Conventional wisdom holds that if startups struggle to grow, they must lack capital. That assumption drives current policy: Rachel Reeves, as chancellor, pressed pension funds to invest in UK assets. The Common Wealth paper says this approach risks making things worse, not better.

The authors' argument is mechanical. Pumping cash into startups inflates eventual sale prices without securing British ownership or control. More capital in a system built for exit produces higher-value exits — abroad.

Peters and Kampmann expose what the paper calls a circular logic. The UK lacks tech giants capable of acquiring successful startups. Selling those startups overseas helps perpetuate that absence. Each exit to a foreign buyer removes a potential domestic acquirer, which makes the next exit abroad more likely. The market does not correct this loop; it profits from it.

What are the social costs?

The paper widens the argument beyond ownership statistics. A system geared toward maximizing capital gains favors businesses that promise lucrative exits. According to the authors, that incentive structure has encouraged surveillance technologies — from wearables to AI chatbots — and exploitative gig platforms.

The result, the paper argues, is a venture ecosystem that concentrates wealth among a few rather than delivering social benefits. Selling British technology companies abroad can enrich investors while thwarting ambitions to build domestic champions. Financial return and industrial development are not the same thing, and improving the former does not necessarily deliver the latter.

Who is saying Britain should keep its companies?

Gordon Brown, the former prime minister, is right, the paper's authors argue, that Britain should retain ownership of its innovations. But retention requires more than rhetoric. Although industrial policy has returned rhetorically in the West, the paper notes that this has not translated into meaningful policy.

Common Wealth calls instead for democratic control over innovation, with investment directed toward social purposes. The paper's preferred model of capitalism is one historically associated with the global south: curbing extractive intermediaries, limiting foreign capital and building domestic capacity.

The examples are concrete. India's publicly funded space programme and Ethiopia's state-owned airline show, in the paper's framing, how sustained public investment can support homegrown capabilities rather than hastily readying businesses for sale.

What does Brazil's vaccine industry prove?

The paper's most daring case is Brazil, which linked universal healthcare for 215 million people to industrial policy through public purchasing, laboratories and technology transfer. The payoff arrived during the pandemic: by August 2021, almost three-quarters of Covid vaccine doses administered in Brazil had been produced at home.

Brazil demonstrates, the paper argues, that a state can finance, research and produce a universal healthcare system that creates employment and productive capacity simultaneously. The lesson the authors draw is larger than vaccines: providing for people could itself be a way of sustaining output.

Why does this matter for Labour?

The political address of the paper is explicit. Making the fulfilment of social needs a motor of economic development, the authors argue, would give Labour a purpose beyond managing scarcity. That is a direct challenge to a government that has framed its technology agenda around pension-fund capital and foreign investment attraction.

The paper's indictment lands at a moment when the UK's flagship AI firm, DeepMind, operates as a unit of Alphabet, and when the 38 largest VC-backed exits of 2010-2023 sit largely inside US and European incumbents. If the authors are right, the next decade's question is not whether Britain can generate valuable firms — it has — but whether any of them will still be British when they matter.

The alternative on offer is not modest: redirecting innovation toward social purposes, restricting foreign capital, and treating public provision as industrial strategy rather than fiscal burden. Whether Labour adopts any of it will determine whether the 300 sales of the past decade remain an outlier or a baseline.