Authored by Mike Reid, Founder, Frog Capital

Pictured: Mike Reid, Founder, Frog Capital

How does a supposed UK ‘Growth, Growth, Growth’ agenda dovetail with a UK ‘War Footing / High Security Status’ agenda when it comes to government policy? With difficulty!

One immediate positive is that this Business and Trade Select Committee inquiry into economic security and the UK investment environment was all about highlighting the contentions, the misalignments and the tensions between growth and Defcon X.

Like many other areas of innovation in the UK, software scale-ups need to be part of the conversation. Thanks to the Boardwave public affairs team, Boardwave had already submitted written evidence focused on reflecting the actual experience of founders and investors dealing with national security concerns through the National Security and Investment Act (NSIA), as they try to build their companies and their portfolios.

The NSIA is the UK government’s way of seeing (and approving) any deal where there is a change of ‘control’ in a ‘RELEVANT’ tech company. See more here NSIA Detail. Spoiler, the remit is VERY broad and, yes, it will impact every exit within its remit.

Boardwave secured a place for me on the panel to share views from the frontline.

3 key themes from the day:

1. The UK is experiencing significant security attacks. Yes, right now. M&S is clearly a high profile case, but there are many more. Whatever we’re doing now, we need to be much better at. There were seriously impressive security contributors to the panel like the former UK National Security Advisor.
2. New threats will be more hybrid - e.g. a combination of cyber attack, social media manipulation and an anonymous drone attack all at the same time to deliberately cause social unrest at a key moment, maybe, in a democratic election.
3. Comfortingly, the panel of MPs was genuinely interested and worried about the impact of more and more security checks & balances on entrepreneurs and UK exports.

I put forward 4 topics:

1. It is incredibly tough to start and scale any successful, exporting business.They understand this. Evidence being the panel itself.
2. The NSIA is a “one size fits all” approach. A seed investor becoming a 25% shareholder is treated in the same way as international Plc being acquired by a foreign power. Given government resources are scarce, it makes sense to have narrower definitions at the smaller end (e.g. 50% or 33% definition of ‘control’).
3. The 17 Industry Area definitions in the NSIA have not to my knowledge been amended/reviewed since early 2022, a lifetime in technology. These need to be reviewed and narrowed to focus on what the UK is really, really concerned about.
4. Any government ‘regulatory processing / approval’ of a wide range of transactions has very large, unseen impacts on decisions to invest or to acquire companies. Don’t underestimate this impact. Focus the legislation on the core areas of strategic concern.

The Parliamentary Select Committee on the Future of UK Tech Investment

Boardwave’s written evidence to the committee sets out these points in more detail, with practical suggestions for how the system could be improved. Things like adjusting threshold levels, narrowing the scope of definitions, and creating a clearer path for lower-risk transactions.

The MPs on the committee were engaged, thoughtful, and genuinely curious, if not subject matter experts. They didn’t just listen politely, they asked follow-up questions, pushed for detail, and even invited written recommendations from the panel. It felt like a proper dialogue.

The Committee will now pull together everything it’s heard, including the written and oral evidence, and produce a report with recommendations for the government. Ministers are required to respond, which means this could be a real opportunity to shape how policy evolves.

The Committee’s next evidence session is on 21 May 2025, examining how businesses assess risk, respond to threats, and shape the policy environment. If you’re a Boardwave member and have the chance to speak, take it. Politicians won’t understand what it’s like to build and run a business unless we tell them. We can’t keep saying we’re not being listened to if we stay silent when invited to speak. You may not get asked again, so speak up now.

Get in touch via boardwave@inflect.co.uk

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