The UK tech startup and investor landscape is facing significant ramifications from updated definitions for sophisticated investors and high-net-worth individuals under new financial promotion rules. In the absence of a U-turn from the chancellor, a pragmatic approach is required to undo the damage to the tech ecosystem.
From January 31, the salary threshold for a high-net-worth individual investor increased from £100,000 – a level set in 2005 – to £170,000. The net asset threshold increased from £250,000 to £430,000.
In addition, investors no longer qualify by virtue of investing in an unlisted company on two previous occasions. This is a change which many current members of the startup and emerging companies landscape feel undermines the benefit of experience when it comes to angel investing....