'We are selling our companies too early': angel Simon Thorpe on 14 exits and the UK's scale-up gap

As an angel investor, Simon Thorpe has backed more than 60 UK startups in the last 15 years, and his investment business, Delta2020, lists 14 exits. Only one of them went to a British buyer. Five years after his last appearance on Angel Insights, I asked him what has changed and why UK startups keep selling out before reaching their full potential.

When Simon last appeared on the show, in early 2021, we were coming out of Covid, and AI was a niche topic for most investors. Since then, he has joined the board of one of AlbionVC's venture capital trusts and kept writing angel cheques. His diagnosis hasn't softened: we start companies well, then run out of the capital to keep them.

Five years on, the team still comes first

In our first conversation, Simon told me the team mattered more than anything. With AI now writing code, decks and models, I expected movement. There was none.

Nor does it have what he looks for: one technical and one commercial founder, a pairing his own exits back up. What has shifted is ambition, with founders aiming at global markets far earlier.

Exits are like buses: you wait for one for a long time, and then several come at once

Simon is blunt about how returns arrive. An early-stage portfolio is not a dividend stream: nothing happens for years, then several exits land at once. He had a run of three close together, all to American buyers, before geopolitical uncertainty and the UK's run of prime ministers cooled the M&A market.

Those buyers rarely want revenue. When Apple bought Spectral Edge, the UK image-processing company, in 2019, it wanted the technology for its phones.

ViewRanger, the outdoor navigation app built in Cambridge, was an exception: it went to Outdooractive, a German company, in 2020. Simon thinks there was "a lot more in it". His one exit to a UK buyer, an insurtech company bought by a UK-quoted group, comes with a long earn-out for every shareholder, so he won't know how good it was for five to ten years.

He also made a point I think new angels underrate. Exits rarely start with founders or investors; they start with a third party's approach. And because an angel is seldom the largest shareholder, your co-investors matter almost as much as the company. If they disagree on where the business should go, trouble usually follows.

Our companies are still selling out too early

Simon doesn't hedge on this one: "Sadly, yes, we are selling our companies too early." The value gets built here and the upside is captured elsewhere, by an overseas buyer or by overseas investors in the later rounds.

Even the companies that stay independent tend to raise their growth money abroad. Quantexa, the London data analytics company and one of AlbionVC's largest holdings, raised a $175m Series F in 2025. The lead investor was the venture arm of Ontario Teachers' Pension Plan, not a British fund.

He welcomes the Mansion House pension reforms, but the timetable is long, and after a generation of investing for income, UK pension funds lack the expertise for growth companies. Until they have it, angels can only do part of the job.

Passing the baton is also how an angel's money gets back to work. A cash exit goes into the next early-stage company, where Simon thinks an angel adds most. "I can't add a lot of value when the company's 150 or 200 people."

The replacement capital Simon wants to see

Simon's phrase for the missing money is "replacement capital": capital that can buy out early investors and fund the next stage, so a sale isn't the only way out. He sees four sources growing.

VCTs. VCT income tax relief fell from 30% to 20% from April 2026, a cut he says "rather came out of the blue". The same Budget doubled the amount companies can raise under EIS and VCT, which he welcomes because it lets VCTs back their best companies for longer. (We looked at whether VCTs are still worth it with relief at 20%.)

Secondaries. Secondary funds and the new PISCES framework for trading private-company shares both help, and the old view that founders shouldn't take money off the table has moved on:

I agree, with one caveat. A secondary sale is only as good as its price, and a founder selling well below the last round signals something the next investor will read.

Venture debt. Simon chairs a venture debt investment committee at Salica Investments (formerly Hambro Perks). A company doesn't need to be profitable, but it does need material revenue to cover the interest.

IP-backed loans. Inngot, one of his portfolio companies, values intellectual property for lenders, and NatWest uses its valuations for IP-backed lending. Simon's rule of thumb is that a company might borrow 40 to 50% of what its IP is worth, so £2m to £2.5m against a £5m portfolio. At an early stage, that can be the difference.

Sovereignty, chips and where angels fit

Then I raised AI sovereignty. In 2023, the UK committed £1bn over a decade to semiconductors. The US CHIPS Act set aside about $52bn. On the show, I called that 52 times the UK's commitment; converted into pounds, it's closer to 40 times, and the US has about five times our population. Either way, the gap is enormous.

Simon doesn't know the right number, but it's "certainly more than a billion. And we are not ambitious enough." The UK can't take on America and China head-to-head, he argues, so it should work with the large European economies and place its bets where it's strongest. Semiconductors qualify on both sovereignty and technical capability.

Does the money flooding into AI and chips cut angels out? He doesn't think so. SwiftKey, one of his, went to Microsoft and is still on phones a decade later. Cambridge Angels took part in the £1.6m round for Singular Photonics, an Edinburgh spinout making single-photon image sensors, this August. The lesson he draws from DeepMind, sold to Google in 2014, is about the capital that wasn't there: with more of it, it might still be a British company.

An angel who has also invested in funds

Simon's portfolio has broadened towards climate tech, though one of his earliest investments was Abundance Generation, the renewable energy platform. Among the newer ones is Wilder Sensing, which uses sound recordings and AI to monitor birds, bats and moths for farms, ecologists and infrastructure owners, and supplied bioacoustic data to BBC Springwatch. For Simon, "it's absolutely about the data."

In healthcare, he backs technology applications, such as Healx, rather than drug discovery, because that's where his expertise lies. When he wanted exposure to life sciences, he invested in early Cambridge Enterprise funds instead of picking companies himself.

It's the most practical question in the episode, and every angel answers it eventually.

Quickfire

1. Founders or investors: who's to blame when a company sells too early? "Both." Right, and a slightly convenient answer for those of us on the investor side of the table.
2. Most overrated thing in pitch decks? "The AI, exactly that." In the product and in the writing.
3. A British company lists in 2030. London or New York? "I'd like to think it would be London, but sadly at the moment it'll be the US."
4. Best recent book? Baltic: The Future of Europe by Oliver Moody.
5. Best advice of the last five years? Understand where your value lies as an angel. "Don't meddle."

We closed the episode by discussing defence tech, the strongest trend since the war in Ukraine began. I've pencilled him in for 2030 to see which answers held up.

The episode in short

• Why do UK startups sell too early?
  UK growth capital is thin, so a trade sale, often to a US buyer, is the easiest route to liquidity. Angel investor Simon Thorpe says UK pension funds are largely absent: Ontario Teachers' Pension Plan, not a British fund, led London-based Quantexa's 2025 Series F.
  
  
• What is replacement capital?
  Money that buys out early investors or funds the next stage so a sale isn't the only exit. Simon points to VCTs, secondary markets (including the PISCES framework), venture debt, and IP-backed loans.
  
  
• Is the team still the most important factor for angels?
  Yes, says Simon Thorpe, five years on. He looks for a backable team, ideally one technical and one commercial founder, who can grow a material business.
  
  
• What changed for VCTs in April 2026?
  VCT income tax relief fell from 30% to 20%, while the amount companies can raise under EIS and VCT doubled. Tax treatment depends on individual circumstances and may change.
  
  
• Invest alongside experienced angels
  Simon's question, ten companies yourself or a fund, is the one SyndicateRoom's Access EIS Fund was built to answer. It invests only where one of its Super Angels invests, at the same time and the same valuation. Our data identified them from Companies House records as angels with returns of 5x or more across at least 8 companies and £100,000 invested. Past performance is not a reliable guide to future results.
  
  
• Each investor's money is spread across 30+ companies over 12 months, from a £5,000 minimum. Fees apply. EIS offers 30% income tax relief, provided you claim it, and relief on an investment made this tax year can normally be carried back to 2025/26. Tax treatment depends on your individual circumstances and may change.

Or read our guide to EIS funds.