# The UK has yet to choose a business model

Markdown copy of https://realalpha.app/s/the-uk-has-yet-to-choose-a-business-model/ on Real Alpha, the best minutes from long interviews with the people building AI. Cite and link the page, not this copy.

- Speaker: [Scott Galloway](https://realalpha.app/people/scott-galloway/) · Professor
- Host: [Steven Bartlett](https://realalpha.app/people/steven-bartlett/) · Host, The Diary Of A CEO
- Show: The Diary Of A CEO
- Episode: [US ELECTION DEBATE: What Trump’s Return REALLY Means For The World! Is The UK About To Collapse?](https://realalpha.app/v/qpBnYB0I6_0/), Jan 23, 2025
- Moment: 17:12 to 23:31 of the episode (6 min), playing on https://realalpha.app/s/the-uk-has-yet-to-choose-a-business-model/; the episode from there: https://realalpha.app/v/qpBnYB0I6_0/?t=1032

## Quote

> “There's $5 million in **venture capital waiting to be deployed** for every startup in the US versus 1 million in Europe.”
> — [Scott Galloway](https://realalpha.app/people/scott-galloway/) at [21:25](https://realalpha.app/v/qpBnYB0I6_0/?t=1285) · The Diary Of A CEO

## Takeaways

1. The UK could be Europe's head office, the US's back office, or a low-tax hub.
2. Galloway says US startups have $5m in VC available per startup, versus $1m in Europe.
3. He sees risk appetite and expansion as larger cultural gaps, too.

## About this segment

Priestley lays out three routes for UK business, while Scott Galloway cites $5m in US venture capital per startup versus $1m in Europe. Their contrast gives founders a concrete location test.

From “US ELECTION DEBATE: What Trump’s Return REALLY Means For The World! Is The UK About To Collapse?”, Jan 23, 2025. [Watch the full episode](https://realalpha.app/v/qpBnYB0I6_0/)

## Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

[17:20](https://realalpha.app/v/qpBnYB0I6_0/?t=1040) national papers in the UK that millionaires are leaving the UK in historic numbers. I think it's 10,800 millionaires left last year, which is an increase of about 160% versus the previous year. And the general sentiment in terms of business confidence in the UK is at a several year low. So I think it's the lowest it's been since just post pandemic. There's this, I think it's the Institute of Accountants.

[17:46](https://realalpha.app/v/qpBnYB0I6_0/?t=1066) a thousand accountants every year and they get they run a survey to see how much confidence they have in business in this country and it's fallen 14 points to 0.2 percent confidence um in terms of business there's but there's this bigger narrative emerging amongst my entrepreneurial friends that if you want to start a business right now the best place to be in the world is to be in america is to get over to america and to leave the uk now dan how does that square i know you have an accelerator you speak to lots of entrepreneurs how does that sort of compare or contrast with what you're seeing at the moment? Yeah, 100%. The value proposition for the UK has dropped through the floor. Very, very high tax. The ecosystem of business is in decline. Some of the smartest people are now in Dubai. Some incredible creators that I know have moved

[18:31](https://realalpha.app/v/qpBnYB0I6_0/?t=1111) to Singapore, Hong Kong, Dubai. Many are going to the USA. So if people are interested in bigger markets and bigger opportunities, they're into the USA. If they're interested in lower tax and more fringe opportunities there in the Middle East. And essentially, the UK hasn't found a place in the world. I think there are three business models the UK could go for, which is either the head office of Europe, which is what we were when we were inside the EU. And everyone used to come here to build a European business. We could be the back office of the USA. So the incubator for the USA, A lot of smart companies get to their first $50 million of value here in the UK and then sell to a US private equity firm or a US listed company.

[19:21](https://realalpha.app/v/qpBnYB0I6_0/?t=1161) And a lot of US companies are now actually coming here to poach talent or to outsource things to the UK more cheaply than they could do it in the US. The wages in the UK are through the floor compared to what you would pay in the US, especially, you know, in tech roles. So very smart people in the UK are massively devalued. And then the third option would be to be an independent tax haven and to go with the low crime, low tax model of Dubai, Singapore, you know, those kind of options.

[19:55](https://realalpha.app/v/qpBnYB0I6_0/?t=1195) So we haven't really picked one of those three yet. We're still, you know, all these years after Brexit and we haven't said which of those three models we want to adopt. Scott, you moved here a couple of years ago to the UK. um and despite everything that's going on in the uk are you still bullish on this being a place for entrepreneurship and business um i was looking at some stats before we started this conversation around the sort of key areas of concern for me business stats i've talked about there the drop in business confidence the entrepreneur exodus that we're seeing but things like knife crime in the uk are up um 81 over the last decade which i think is a symptom probably of something else And one of the big things I think a lot about as an entrepreneur at the moment is artificial intelligence.

[20:40](https://realalpha.app/v/qpBnYB0I6_0/?t=1240) And our investment in artificial intelligence from a global perspective is down about 2000% versus a country like America. So you've moved here. You've brought your family here. Are you bullish on the UK versus the US from an entrepreneur's perspective? So the question I get most frequently when I speak here is to compare and contrast the US with the UK. and I use a personal anecdote. My parents immigrated to the U.S. from Glasgow and London when they were 19 and 22. They took enormous risks. I've been an entrepreneur my whole life.

[21:10](https://realalpha.app/v/qpBnYB0I6_0/?t=1270) I like to think that a lot of my success isn't my fault, that I inherited sort of that risk-taking DNA. And when I speak to people in the U.K., I say the primary difference is you're the ones that stayed. And that is it kind of comes down to a risk appetite. The U.S. has five times per capita are the number of entrepreneurs. It has five times the dollar volume per startup. There's $5 million in venture capital waiting to be deployed for every startup in the US versus 1 million in Europe. I love what Constantine said about a restaurant. I went into this great little restaurant in Soho a few weeks ago called Dig In.

[21:46](https://realalpha.app/v/qpBnYB0I6_0/?t=1306) I loved it so much. I said, I left my card and said, can you have the owner? I'd like to fund the, I'd like to open another one. Does he need money? I would never, I just would never do that here. I thought that was a really interesting insight. And the collision of risk, crazy ideas that occasionally become crazy genius and technology and intellectual property and great universities results in a company that no one had heard of five years ago being worth more than the entire UK stock market, NVIDIA.

[22:16](https://realalpha.app/v/qpBnYB0I6_0/?t=1336) So there's just an enormous difference. The way I would summarize my impression of the UK economy, I'll just say London. I have no experience in it. I don't go anywhere that's not walking distance from Marlombone. So my bubble is pretty opaque. But the way I would describe the economy here is I love the term the butler economy. And that is all the money I see being made here is people servicing wealth created somewhere else.

[22:44](https://realalpha.app/v/qpBnYB0I6_0/?t=1364) you're either in financial services servicing rich people you're either opening a restaurant or hospitality servicing rich people but i don't see a lot of organic wealth creation i interviewed the two quote-unquote inventors of ai at one of your prestigious universities my first question is how the hell were you not able to make any money if you invented ai why haven't you be able to capture any money but just for your listeners my summation of europe versus the u.s after molesting the earth for the last 35 years is u.s is still the best place to make money and europe is still the best place to spend it is this a failing nation scott i think you have too much going for you to be described as a failing nation you still have amazing universities