Startup Founders Share Their Reactions And Thoughts On Autumn Budget

October 30th is the day the Autumn Budget is finally released, and the government has introduced new fiscal rules to rein in public spending. The budget intends create a balance between daily government operations and tax revenues by 2029-30, so that regular expenses do not rely on borrowing. Public debt will also shrink as a percentage of GDP, focusing future loans only on long-term infrastructure and development projects.

Public services will see budgets grow 2% annually, maintaining operational stability. On top of this, more than £100 billion will be invested across housing, transport, and research over the next 5 years. These projects are expected to support job growth and help improve productivity after years of slow economic recovery.

The government has also promised fewer unexpected fiscal changes, giving businesses and investors a clearer picture of the future. The Office for Budget Responsibility forecasts economic growth reaching 2.0% in 2025 as these policies take hold.

 

How Will Public Services Improve?

 

The budget allocates more resources to the NHS to reduce waiting times and expand care. An extra 40,000 weekly elective procedures will be added to help manage patient backlogs. £1.5 billion will go toward increasing diagnostic services, while £1 billion will be used to repair healthcare infrastructure and add new hospital beds.

Education will also benefit from increased funding, with £2.3 billion allocated to hire 6,500 teachers, aiming to improve classroom conditions. To modernise learning environments, £1.4 billion has been set aside for rebuilding schools that are in need of repair and upgrades.

Local infrastructure projects will cover repairs to public buildings and roads, alongside £1.2 billion earmarked for expanding prison capacity. A new Border Security Command will be launched to strengthen border controls, while extra funding will support neighbourhood policing and help reduce antisocial behaviour.

 

What Will Be Done To Help With The Cost Of Living?

 

The National Living Wage will increase, giving full-time workers on minimum pay over £1,400 extra per year. This change is set to benefit over 3 million people. To further help struggling households, £1 billion will be channelled through the Household Support Fund, allowing councils to respond quickly to local emergencies.

The State Pension will grow by 4.1%, giving pensioners up to £470 more annually, benefitting more than 12 million people. Working-age benefits will rise in line with inflation to protect low income households from higher living costs.

A Fair Repayment Rate will help those on Universal Credit, capping the amount that can be taken from payments to repay debts. This change will allow 1.2 million households to retain more of their income each month. Carers will also have more flexibility, with a higher earnings limit introduced, making it easier to work extra hours without losing support.

 

How Will Businesses Be Affected?

 

Businesses will receive relief through a cap on Corporation Tax, which will remain at 25%, making the UK attractive to investors. Retail, hospitality, and leisure businesses will benefit from lower tax rates starting in 2026-27, while small businesses will receive £1.9 billion in support to help manage costs.

Pubs will see a reduction in alcohol duty, with the price of a draught pint dropping by a penny from February 2025. The Scotch Whisky industry will gain from the removal of mandatory duty stamps, along with new efforts to certify exports for international markets.

A Corporate Tax Roadmap has been introduced to provide businesses with long-term guidance on tax planning. This is to encourage investment by giving businesses greater certainty about future financial conditions.

 

How Are Startup Founders Feeling About The Budget?

 

A few startup founders have shared their thoughts and opinions on the budget, and how the changes might affect them, as well as what they think could’ve been done better or differently…

 

Our Experts:

 

• Dr. Andrea Cullen, CEO and Co-founder, CAPSLOCK
• Zain Ali, Co-founder and CEO, Centuro Global
• Julia Linehan, Founder and CEO, The Digital Voice
• Forbes McKenzie, Founder and CEO, McKenzie Intelligence Services
• Rafael Rozenson, Founder, Vievé
• Muj Choudhury, CEO and Co-founder, RocketPhone
• Wil Benton, Co-founder and Director, Metta
• Laurent Descout, Co-founder and CEO, Neo
• Greg Hanson, GVP, EMEA North, Informatica
• Amy Knight, Director and Co-founder, Must Have Ideas
• Santosh Sahu, Founder and CEO, Charac
• Sean Kane, Chair and Co-founder, F6S
• Srini Rao, Chief Business Officer and Head of EMEA, LTIMindtree
• Rich Wilson, CEO, Gigged.AI
• Harriet Christie, Chief Operating Officer, MirrorWeb
• Ifty Nasir, Founder and CEO, Vestd

 

 

Dr. Andrea Cullen, CEO and Co-founder, CAPSLOCK

 

 

“The policies in this year’s Autumn Budget fell short of truly solving the deeply ingrained challenges facing the UK’s cyber security resilience. Policies such as Skills England, which was briefly mentioned in the speech as part of the seven pillars of growth, will do little to solve the severe talent shortage and lack of diversity seen in the sector. The key to addressing this issue lies in creating a grassroots movement that starts well before further and higher education and, instead, at the earliest stages of education – primary school.

“The Budget failed to move beyond its traditional, top-down allocation of resources and superficial initiatives. Instead, it needed to focus on long-term planning and investment that addresses the root causes of the skills gap. This includes reshaping how STEM subjects are taught, ensuring they incorporate modern cyber security challenges and innovations.

“Training must be re-evaluated to align with industry needs, and more must be done to provide relatable role models from diverse backgrounds to inspire young people, particularly underrepresented groups, into the field. There was also a lack of support for apprenticeship programmes and initiatives that can provide hands-on experience, creating accessible pathways into the sector for young talent.

“By integrating cyber security awareness and technical skills into core subjects, young people will be confident in identifying digital threats and will be inspired to consider careers in this rapidly growing field. This long-term investment from the governmenT will help build a workforce that is ready to defend against the evolving threat landscape, ensuring the UK remains secure and resilient.”

 

Zain Ali, Co-founder and CEO, Centuro Global

 

 

“We are pleased that the more excessive predictions of a double-digit increase in the capital gains tax rate have not come to pass. So many of the high-growth companies we work with have been founded by overseas nationals who have chosen to build value for the UK.

“We applaud the chancellor for not punishing entrepreneurship. Nonetheless we also worry that even this moderate increase may translate into a major opportunity cost if foreign nationals with great ideas opt for other territories with more favourable tax regimes.”

 

Julia Linehan, Founder and CEO, The Digital Voice

 

 

“As a business owner who works with so many companies, there was a definite nervousness and dread for the budget – and the fall out it will have. Right now, our industry is expecting a 12.7% growth in digital in 2025 but that doesn’t mean that it will be easy and businesses need support, not endless taxation.

“As a company founder, my concern for me and our client partners is that there will be pressure to limit investment in tech and innovation and yet this is what is needed to help boost the market and keep growing and innovating.”

 

Forbes McKenzie, Founder and CEO, McKenzie Intelligence Services

 

 

“The chancellor’s CTG and NI increases will be a disaster for the UK’s tech entrepreneurs.

“With less tax revenue to benefit from, business owners are less likely to sell up or even start out, with higher CGT essentially making shares less attractive to investors now net gains are diminished. Startup valuations will drop, making it challenging to attract new investment to fund growth, as the government assumes a kind of shared ownership through its indirect claim on each business. It’s a shift that will ultimately deter the high-value startups and innovative small businesses our economy relies on.

“As for the increase in National Insurance (NI) for employers, businesses will likely pass the added costs onto their customers, impacting those the government claims to protect. This, in turn, undermines the idea that the budget doesn’t affect workers – because it does.

“By sustaining inflation, this policy will only keep interest rates high, placing greater pressure on things like household mortgages. Rather than supporting economic recovery, then, these measures risk stifling growth, deterring innovation and complicating investment.”

“There are plenty of business-friendly places that would welcome a mass influx of tech talent from the UK’s shores. Most governments recognise that a strong technology base is an economic differentiator, and Paris, Berlin, Zurich, or Geneva, will be standing ready with open arms if the government hamstrings our tech industry with further taxes.

“Let’s not forget you can get to New York in just five hours, and Ireland, who benefitted hugely from the .com revolution by cutting their taxes, is just an hour. Given they have no language barrier, they’re ideal places for tech startups to set up shop.”

 

Rafael Rozenson, Founder, Vievé

 

 

“The budget represents an opportunity to chart the UK on a more business friendly path after several years of chaos on the part of the conservative government and Brexit. However, I have some concerns.

“I am looking to exit my business in the next 1-2 years and the potential removal of entrepreneurs relief will have massive implications for me; My business journey has been largely self-funded and I don’t know if I would have taken the risk if I was aware of a change like this.

“I am also concerned on the reduction of capital gains tax and dividend relief to be more in line with PAYE rates: again if I am taxed on the capital gains on my business sale in this way why would I have ever started a business? This really would remove the incentive to start a business for many and take the risks.”

 

Muj Choudhury, CEO and Co-Founder, RocketPhone.

 

 

“The Chancellor’s announcements on Capital Gains Tax will impair investment and growth across Britain’s startup sector. Increasing CGT creates an immediate barrier to both company formation and scale-up investment, particularly affecting early-stage technology and AI ventures where risk capital is essential.

“This reform sends the wrong message at a time when the UK is attempting to establish itself as a global AI hub. Business leaders already view the CGT review negatively, and confirmation of these changes will only deepen that concern. Maintaining the lifetime limit for business asset disposal relief is not enough to mitigate this, effectively penalising entrepreneurs who have invested years building innovative companies.

“Most troubling is the timing – as international competition in the technology sector intensifies, we are actively discouraging investment in British startups and scale-ups. With the UK tech sector now valued at $1.1 trillion, built on the success of 171 unicorns, the stakes couldn’t be higher. These reforms fundamentally undermine the entrepreneurial equation: why would founders accept years of below-market salaries, 80-hour weeks, and substantial personal risk when the potential financial upside is now barely distinguishable from regular employment?

“This won’t just stifle investment – it threatens to halt new business creation entirely, particularly in high-risk, high-reward sectors like technology.

The projected additional tax receipts must be weighed against the long-term cost to our digital economy. While the business tax roadmap offers some minor consolations, these are vastly overshadowed by the broader implications of the CGT reforms.”
 

 

Wil Benton, Co-founder & Director, Metta

 

 

“Individually, I understand the need to fix the fiscal black hole – and am delighted we have what seems to be (mostly) a responsible government willing to attempt the fix.

“However, I’ve been really frustrated at the government’s positioning that they seemingly don’t consider employers to be working people. I’m also concerned about the lack of foresight about how employers will bear quite the brunt of today’s announced tax changes, and what that will mean for the businesses in question. Even more so given the focus placed on ‘innovation’ driving us out of the tax deficit, and we all know the British innovators are mostly SMEs!

“Maintaining the fuel duty allowance is good – both consumers and businesses. The news about the 25% Corporation Tax for the duration of this parliament – as was the R&D relief maintenance – was also welcomed. Increasing the Employer NIC is a real blow, and will likely have immediate knock-on impacts offsetting any potential tax gains. Especially as it’ll impact SME employers paying market rate for specialist skills.

“The Chancellor explicitly called out ‘promoting entrepreneurship’ before announcing a reduction to Entrepreneur Relief (+8% by 26/27 FY) and an increase of GCT – both vital routes for those entrepreneurs at the culmination of their startup journeys. Lastly, the Air Passenger Duty increase will make air travel more expensive for consumers, at a vital time for the aerospace and aviation industries when they are still struggling to recover from the pandemic.”

 

Laurent Descout, Co-founder and CEO, Neo

 

 

“It’s disappointing to see the Chancellor moving forward with the increase in Capital Gains Tax, as this risks undercutting vital support for start-ups at a time when they need it most. This coupled with the national insurance hike represents a significant blow to businesses. Such moves discourage essential investment in start-ups, threatening their growth trajectory, IPO prospects and the jobs they create.

“The UK should be fostering a pro-growth environment, especially given the recent spike in insolvencies and this tax increase feels like a step in the wrong direction for the business community.”

 

Greg Hanson, GVP, EMEA North, Informatica

 

 

“The UK is at risk of missing a once-in-a-generation opportunity to lead the wave of AI adoption globally.

“Companies have been patiently waiting for greater direction on how emerging technologies can be responsibly leveraged for benefit. And while digital technologies are at the heart of the UK’s vision for a modern industrial strategy, the absence of any new investment in research or infrastructure for emerging technologies like quantum or AI is glaring.

“Additional funding would have provided a clear mandate on the areas that companies should prioritise in their future operations. It would have supported companies in building investment strategies for high-growth areas like data and AI, while also being mindful of the regulatory costs and processes they need to consider.

“But a lack of clarity will now cause many to be conservative in their approach. And without policies and investment that supports the industry, the UK will potentially lose valuable expertise, with skilled individuals and companies likely to go where the focus and investment is the largest.”

 

Amy Knight, Director and Co-founder, Must Have Ideas

 

 

“The proposed changes are going to hit businesses hard, particularly small/medium-sized businesses. With the increase in Employers NI, employers are likely to be more cautious about recruiting for new roles. It also likely means that there is less money available to spend on salaries because of this extra cost. Growth can’t be achieved by making it more difficult for employers to provide jobs.

“On the ER/CGT potential increases, this obviously makes business owners less likely to look to sell or get investment in their business. This not only potentially decreases the motivation to grow your business, halting growth but also means that business owners who have worked hard to grow their business do not get to see the full rewards of that. They say they won’t increase taxes on working people (and not defined it) but I have worked horrendous hours building a business and providing employment for the last 6 years and am facing huge tax increases.”

 

Santosh Sahu, Founder & CEO, Charac

 

 

“The Labour government has promised to make the UK a more attractive hub for investors and startups as part of their commitment to stimulating economic growth through innovation and entrepreneurship. The Chancellor’s support for small businesses, as well as research and development, is welcome, yet tax raises for high-net-worth individuals, who are often pivotal investors in early-stage companies, may drive them out of the UK.

“Higher taxes on capital gains, for example, may lead these investors to seek out other, more favourable markets, which could ultimately stifle the flow of funding critical to the UK’s vibrant startup ecosystem. This shift would particularly affect high-growth sectors like healthtech, where access to capital is essential to scale innovative solutions that contribute to both the economy and public health.

“To sustain and build upon the UK’s reputation as a global innovation leader, it’s crucial that Labour continues to foster a regulatory environment that is conducive to startups. Their backing for VCT and EIS schemes will provide tax incentives for entrepreneurs to invest, facilitating access to capital for innovative startups. Supportive policies and regulatory frameworks in these areas will help offset any adverse effects of tax changes, ensuring that the UK remains a competitive destination for talent, capital, and breakthrough ideas.”

 

Sean Kane, Chair and co-founder, F6S

 

 

“Capital Gains Tax isn’t just about rich investors, it is one of the primary ways that smart entrepreneurs help the next generation of founders to grow. If the UK wants to stimulate growth and emulate the success of Silicon Valley, exited founders will be crucial. Government, pension and other funds can help, but successful ecosystems need these founders to help grow the next generation.

“Business Asset Disposal Relief (BADR) is the force multiplier that generates the most powerful venture funds in any economy, including the United Kingdom. While there are good arguments for raising CGT in general, to bring it more in line with income-based taxation, BADR should have been increased back towards the original £10 million allowance.

“Changing one without reviewing the other will suffocate entrepreneurship in the UK and could result in a powerful drag on job creation and innovation. These moves will only disincentivise the most value-add investors from joining the UK’s economic growth engine.”

 

Srini Rao, Chief Business Officer and Head of EMEA, LTIMindtree

 

 

“The power of digital and data to boost UK productivity has never been more critical to the UK’s economic growth. We welcome the newly formed panel of experts who will play a key role in shaping a 10-year vision for the future of digital government and the Made Smarter Adoption programme to double to £16 million in 2025-26.

“Putting innovation at the heart of government will reduce waiting times, and enhance the accessibility of public services. That is just the beginning however – and we encourage the new Labour government to enable a pro-innovation society that allows businesses to engage in digitalisation, effective automation, and the integration of generative AI.

“The UK is changing for the better and so the focus should be on improving the digital infrastructure. It will also mean driving investment to empower and upskill users to independently access and utilise digital assets like Gen AI. That way the UK can propel itself forward on its digital journey.”

On the tech industry

“The Budget pressures highlight a delicate balance within the tech industry, especially as demand for digital services increases. The government should outline how its new expert panel will prioritise science and technology goals, while accelerating the nation’s ability to rapidly integrate AI and cloud technologies. Technology will play a pivotal role in shaping the future of jobs, ensuring that the workforce remains highly skilled to meet the demands of an evolving world.”

 

Rich Wilson, CEO, Gigged.AI

 

 

“The budget announced today by Chancellor Rachel Reeves has left the UK workforce and business community facing new challenges. By increasing employee National Insurance contributions without addressing the problematic IR35 regulations, Labour has chosen to overlook key opportunities for economic growth and workforce flexibility.

“The increase in National Insurance will raise the cost of full-time employment just as businesses are grappling with rising operational costs. This decision will slow down full-time hiring and reduce opportunities for workers at a critical time.

“Furthermore, Labour’s choice to leave IR35 unchanged continues to place an undue burden on freelancers and businesses alike. Without reform, IR35 restricts companies’ ability to bring in skilled contractors, while freelancers are left in an environment that limits their potential and job security.

“This budget was a chance for Labour to support both traditional employment and the freelance economy which was forgotten about in the last two budgets. Instead, the policies announced today may hinder the UK’s competitiveness and hold back our talent market from thriving in a changing global economy.

We urge Labour to repeal IR35 Reform to take a more balanced approach that truly supports growth and flexibility in the workforce.”

 

Harriet Christie, Chief Operating Officer, MirrorWeb

 

 

“As anticipated, today’s budget has placed a strong emphasis on tax policies and changes that will significantly affect business operations. This means that financial advisors and tax experts will be working hard and upping communication tenfold to assist UK businesses in adapting and thriving under the new budget.

“The sensitive nature of this financial communication is likely to occur on a larger scale across multiple communication channels, including those that are notoriously hard to regulate and monitor, such as WhatsApp. This presents substantial compliance challenges for financial firms looking to support organisations during this transition while still adhering to regulatory requirements.

“Even without today’s budget changes, this level of non-compliance in multi-channel communications has already led to a multi-billion-dollar problem on a global scale. Therefore, unless UK financial firms want to find themselves joining this list of substantial fines, it’s essential for them to proactively prepare for these shifts and strengthen their operations to navigate these multi-channel communication compliance challenges.”

 

Ifty Nasir, Founder and CEO, Vestd

 

 

“Founders and business owners will be relieved to hear the Chancellor’s continued support for the Business Asset Disposal Relief (BADR), which is vital for incentivising entrepreneurs to take the risk of starting their own businesses.

“After rumours of BADR being abolished completely, maintaining the £1 million lifetime limit on gains is a good outcome for entrepreneurs. Although relief will increase from its current level of 10% to 14% in April 2025 and 18% from 2026, this maintains a significant gap compared to the higher rate of capital gains tax (CGT).

“The news is also a victory for thousands of workers with access to equity-linked rewards like employee share schemes. While founders were the focus of much of the discussion around BADR ahead of the Autumn Statement, it also provides relief to employees who benefit from a successful exit.

“These schemes are vital for the founders and workers generating the growth that is important to the government’s goal of restoring public finances. Schemes like BADR, the Enterprise Investment Scheme (EIS) and similar initiatives such as the Enterprise Management Incentive (EMI) employee share scheme are rightly acknowledged as the global gold standard and have put the UK at the forefront as an incubator of innovative startups.

“We will need more of these schemes to provide a relative ‘safe space’ to help businesses scale, so they can bring their full economic potential to this country, rather than being bought and taken offshore.”