Brexit has given Britain an opportunity to build its technology industry by severing ties to “old Europe”, one of the world’s leading short sellers has said.
Bureaucracy and an aversion to risk-taking have stifled the European Union’s attempts to build its own tech companies and compete with America, according to Gabriel Grego, the founder of hedge fund Quintessential Capital.
Brexit now has the potential to free Britain from EU red tape and catapult it into the US sphere of influence at a time when the US is pushing to secure its technological dominance under Donald Trump, Mr Grego said.
Mr Grego said: “There is certainly a lot of pessimism in the UK, some of it is justified and some of it unjustified. The justified parts connect to ‘old Europe’.”
He added: “If Brexit has the long-term effect of shifting mood away from EU regulation, with its bureaucracy, and shifts it towards the US sphere of influence … that might be the sphere of influence you want to be in.”
The hedge fund manager, who lived in Britain in the early 2000s having studied at the London School of Economics, said that while he would have voted against Brexit if he were a British citizen, the UK’s exit from the EU could have long-term benefits.
He said: “I’m very fond of the culture and very fond of the country.”
Mr Grego founded Quintessential Capital Management in 2008. The New York hedge fund has subsequently led high profile campaigns against British companies, including cybersecurity firm DarkTrace and retail conglomerate THG, which have driven sharp movements in their share prices.
His comments come as Emmanuel Macron seeks to woo the world’s top technology companies into investing in France at his AI Action Summit in Paris.
At the summit on Tuesday, JD Vance, the US vice-president, hit out at the EU’s “excessive” regulation of big tech, calling it a “terrible mistake”. Ursula von der Leyen, the European Commission president, later said Europe could become “one of the leading AI continents”.
Mario Draghi, the former Italian prime minister and ex-president of the European Central Bank, said in September last year that the EU needed to invest an extra €800bn (£670bn) each year to catch up with rivals in AI.
Mr Grego said: “Trump understands very clearly that it’s a task of existential importance that America retains technological supremacy in certain fields.”
Europe’s failure to develop a tech industry on par with America’s is about more than just a lack of financing, he added.
Mr Grego said: “For a whole bunch of reasons, Europe has failed to generate a tech industry capable of creating large tech companies and unfortunately for Europe, that’s where the money is. There’s a lot of reasons for that, I don’t think it’s just a case of underinvestment.
Story Continues
