On April 8th, President Donald Trump announced a trade deal with the UK, solidifying a strong trade relationship between these two countries.
But what does it mean? And how does it affect startups in particular?
What Does The Trade Deal Mean?
Whilst there seems to be a lot of hype about the agreement, some journalists have been quick to point out that this is not a free trade deal, but a tariff agreement.
In particular, the agreement covers industries like automotives, steel, aerospace and agriculture. However, there are other industries that are still waiting to hear the result of further negotiations, so it certainly has a way to go.
So what has been agreed so far? Here are the headlines:
- Tariffs on UK car exports to the US have been reduced from 27.5% to 10% – but only for the first 100,000 vehicles exported every year.
- There is no more 25% tariff on steel products coming into the US from the UK below a certain quota
- Aerospace parts are now tariff free
- The UK has agreed to allow more US beef into the country, raising the tariff-free quota from 1,000 to 13,000 metric tonnes. In return, British farmers get the same level of access to the US. The UK Prime Minister has confirmed that this will not impact UK food quality.
- The UK has removed tariffs on ethanol from the US.
- Note: A 10% tariff still applies to most UK exports.
What Does This Mean For UK Startups?
With the US being such a big market, any deals that encourage more collaboration between the two countries is definitely a good thing, especially for businesses in the above sectors.
Whilst there is still a 2% digital services tax, meaning online businesses may not see the benefit just yet, the agreement is certainly a step in the right direction.
To find out how business owners feel about the news, we asked the experts. Here’s what they had to say.
Our Experts
- Kate Leaman, Chief Market Analyst at AvaTrade
- Ming Kong, Co-Founder and CEO at TG0
- Viktor Clintom, Chief Operations Manager at Clintopia
- Rick Smith, Founder and Managing Director of Forbes Burton
- Mark Pearson, Founder of Fuel Ventures
- Jon Mead, Founder & CEO at PartnerBridge
- Hadia Choudri, Senior Lecturer (Innovation and Entrepreneurship) at The University of Law Business School
- Kathryn Wright, Chief Operating Officer at Antavo
- Ivo Mertens, Chief Economist at iBanFirst
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Kate Leaman, Chief Market Analyst at AvaTrade
“The UK-US trade deal announced today brings welcome relief to UK markets. Key tariff cuts on the automotive and British steel industry should help improve profit margins for UK exporters. There is also optimism that this deal could act as a springboard to further tech partnerships between the two nations.
“The FTSE 100 and 250 have reacted positively, with gains being driven by optimism around reduced trade barriers and better earnings prospects. Midcaps in particular stand to benefit.
Sterling has strengthened modestly – trading around 1.335 USD – supported by reduced trade uncertainty. However, the Bank of England’s decision to cut interest rates today by 0.25% has limited further gains.
“While not all of the details of the deal have been finalised, this is hopefully a meaningful step toward smoother UK-US trade and offers a positive backdrop for UK equities and the pound.”
Ming Kong, Co-Founder and CEO at TG0
“As a founder of a growing UK tech company, I’m hopeful that the new UK/US trade deal will be a net positive for small businesses like ours. It’s a real opportunity to break down barriers, reach new markets faster, and build stronger global partnerships.
“The UK is already home to over 150 tech unicorns (more than any other country in Europe) and continues to lead in innovation. That spirit was clear at 10 Downing Street this week, where I joined fellow Tech Nation Future Fifty founders to mark the programme’s relaunch. With this trade deal in place, I’m optimistic about what we can achieve, not just for TG0, but for the whole UK tech ecosystem.”
Viktor Clintom, Chief Operations Manager at Clintopia
“The UK-US trade deal simplifies trade by reducing tariffs and aligning regulations, making it easier for small businesses to export and import goods between the two countries. This means fewer administrative headaches and reduced costs, which is crucial for startups operating on tight margins.
“A key advantage of the deal is the focus on improving supply chain resilience. Startups can benefit from smoother operations, as the agreement includes efforts to enhance data sharing and cooperation on logistics issues. This means faster response times to disruptions and better risk management for those relying on international supply chains.
“Additionally, startups can take advantage of easier access to each other’s markets. The deal lowers barriers to entry, which opens up new opportunities for growth, especially in sectors like tech, manufacturing, and agriculture.
“However, there are challenges too, such as staying compliant with evolving digital trade regulations. Startups need to stay ahead of these changes to avoid potential pitfalls. But overall, the deal presents a more streamlined and supportive environment for startups looking to expand globally.”
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Rick Smith, Founder and Managing Director of Forbes Burton
“Outside of the steel, aluminium, automotive, and potentially pharmaceutical industry, UK startups are unlikely to be too affected by the new trade deal.
“What the trade deal does offer, however, is hope that the flat 10% tariff that Trump applied to all other imports from the UK might be whittled down somewhat. Despite still having tariffs apply to everything but steel and aluminium, it must still be seen as somewhat of a coup to be the first nation to secure some sort of reduction. Indeed, trade groups in US neighbours, Canada and Mexico are thought to be furious that priority has been given to the UK.
“UK government officials have described the deal as a starting point for future deals, with Business and Trade Secretary, Jonathan Reynolds telling the press that they would continue trying to reduce the baseline 10% tariff. As such, for startups hoping to export to the states, this trade deal may serve to calm some nerves and even offer some hope moving ahead. Despite this, I imagine the capricious nature of the US president may prompt many to look at other international markets instead before relying on smooth exporting to America.”.
Mark Pearson, Founder of Fuel Ventures
“The UK-US trade deal is a win for UK startups. It’s not just about smoother trade, it’s about opening the door to an exciting market. The US is massive, and now UK businesses have a clearer path to get in and make a name for themselves.
“For UK founders, this deal means fewer hoops to jump through when expanding stateside. They’ll get easier access to new customers, and potential partners, and a chance to really scale up. The US loves innovation, and UK startups have the creativity and grit to thrive there. This deal just makes it that much easier to dive in.
“With fewer regulations and less red tape, British businesses can hit the ground running. Whether they’re in tech, fintech, the US market is ripe for the taking. It’s a chance for them to take their product to a whole new level, without the usual hassles.
“In short, this trade deal is great news for UK startups. It’s time to get bold, think big, and show the US what we’ve got.”
Jon Mead, Founder & CEO at PartnerBridge
“I think the deal is actually really sound for the UK. The farmers are probably the biggest winners here, which ultimately impacts everyone and will bring down the process of food in both countries. From a tech perspective, two things stand out: first, the privacy and security rules are still in place for UK citizens. This is a big win, the US was pushing hard to lower the standards for tech companies who want more access to private information, putting individuals at higher risk of fraud attempts and identity theft.
“If anything, these rules should become more stringent, not less, in the rising age of AI.
“Second, keeping the 2% digital services tax on technology companies not in the UK will continue to foster digital innovation here. Much to the chagrin of the large American companies, who are claiming that the tax is discriminatory, this is a great move to build trust in the UK tech sector. While the trade deal isn’t exactly perfect for either country, it is certainly a good step forward.”
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Hadia Choudri, Senior Lecturer (Innovation and Entrepreneurship) at The University of Law Business School
“The new UK-US trade deal has some good news for start-ups especially those in fast growing industries. It’s not all revolutionary, but it does make it a little easier for entrepreneurs who want to grow their businesses abroad. The deal simplifies some of the formalities to operate across borders. For instance, a UK fintech startup can now more easily partner with American banks or payment processors.
“On the other hand, an American clean energy company would have smoother access to the UK’s renewable energy market. Even physical product businesses like one manufacturing eco-friendly/sustainable packaging can benefit from shorter shipping times and fewer customs issues.
“With all that said, it’s far from perfect. Some sectors, like pharmaceuticals, creative industries, and consumer goods, didn’t gain much from this deal. And digital taxes remain unresolved, which could create technicalities for tech firms. Overall, this is a step in the right direction. For startups with global ambitions particularly in fintech, green tech, and hardware, the path between the US and UK just got a little smoother. And that’s good news for businesses looking to expand beyond their home market.”
Kathryn Wright, Chief Operating Officer at Antavo
“For technology platforms, anything that smooths the path between UK innovation and US adoption is a step forward. The deal may not be perfect, but it does support reducing friction for cross-border collaboration and digital infrastructure.
“European brands are also being forced to raise prices in the US just to keep up with the tariffs and the shifting supply chain costs. When at risk of losing ground to local competitors, loyalty becomes less about price and more about relationships. If a customer is loyal because of the price, they’ll leave the second it goes up. But if they’re loyal because of the experience, the emotional connection, the sense of belonging — then they’re more likely to stick around even if it costs them a bit more.
“Plus it’s not just about discounts; it’s about rewarding behaviours, creating exclusivity, and making customers feel like insiders. If brands double down on that, they have a real chance to defend their market share in the US, even if the playing field isn’t level on price.”
Ivo Mertens, Chief Economist at iBanFirst
“The UK-US trade deal is certainly a positive step for UK exporters – particularly those in the automotive and steel sectors, where tariffs have been reduced to zero. For SMEs operating in these industries across international trade, this offers some welcome breathing room.
“While this agreement provides some near-term wins, it’s difficult to call it a true “deal” in the comprehensive sense. It’s more of a framework than a full trade agreement, and its lack of depth leaves plenty to be desired. Ultimately, the US has trebled tariffs on the UK and in return the UK has cut its tariffs by two thirds.
“Currency markets reflect this mixed picture. Sterling initially gained on the back of the BoE’s rate cut but has since slipped back against the US dollar – suggesting limited market confidence in the deal’s long-term value. However, the pound’s trade-weighted performance is encouraging, offering reassurance for SMEs trading beyond the US.
“At this juncture, SMEs cannot underestimate the importance of currency strategies to protect margins and boost their advantage, especially as the UK looks to establishing a UK-EU trade relationship as the next call.”
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