UK's elite hardware talent is being wasted

The Stark Reality:

Top hardware engineering graduates in London get £30,000-£50,000. Similar roles in Silicon Valley pay $150,000+.

At traditional engineering companies, starting salaries are ~£25,000. It's no surprise people choose finance or consulting. At least they pay properly. Computer science grads, meanwhile, go to big tech or quant firms, where starting salaries are often £100,000+.

Examples of wasted potential:

• Sarah built a fusion reactor at 16. Now she makes sure payments work in fintech.
• James 3D-printed prosthetic limbs for his A-levels. He now writes credit risk reports.
• Alex built an AI-controlled drone swarm for disaster relief at 18 and graduated with top honours from Imperial. Now he perfects the ergonomic feel of a button on a household appliance.

These people aren't special cases. They are symptomatic of a generation of wasted talent: a misallocation of human capital on a national scale.

As a hardware founder in London, I've seen this firsthand. We have the potential to build incredible things, but lack the means to do so.

Root Causes:

Hardware has traditionally been an afterthought in Europe. Unlike lucrative software jobs, hardware engineering requires you to be in a certain place. It deters European VCs, who are bullish on fintech and SaaS and far warier of hardware, which leads to underinvestment, which leads to... more underinvestment. Meanwhile traditional engineering firms aren't adapting their approach to talent and aren't competitive on pay.

Consequences:

We will miss out on the next ARM or Tesla, and the dozens of companies that spring up around each one. And we risk losing our best talent abroad for good, in a world where technological edge equals geopolitical power.

Debunking Common Myths

"London's lower living costs justify lower salaries."

False. London's living costs match NYC and are higher than most of California (and definitely Texas). Cheap salaries mean cheaper success, which makes for a cheaper ecosystem: a self-fulfilling prophecy that keeps the industry small. In the US, high salaries and even higher exits mean more angel and VC money, which in turn pays higher salaries. The best roles attract the best people, from anywhere. When Google moved into London and started paying good money, it changed London tech forever.

"UK's small market limits growth."

False. Dyson started in a barn in Wiltshire and is now a global tech powerhouse, innovating in Singapore and Malaysia. Ocado went from online grocer to global automation technology company, with robotics in warehouses across Europe and North America. ARM, made in Britain, is in 95% of the world's smartphones.

"Hardware is riskier than software."

False. PCB and 3D-printed prototypes now arrive in 24 hours, so prototyping timescales are close to software development. Products with tightly integrated hardware and software (hello, Apple) are also more defensible than software products. And the exits are huge: SoftBank acquired ARM for $32B in 2016, and it has since been worth $140B+. CSR (Cambridge Silicon Radio) sold to Qualcomm for $2.5B in 2015. Even without an exit, Dyson was valued at over £20B in 2023.

The Arbitrage Play:

It isn't about costs. It's about ambition.

If you start a software company today, you compete directly with the best US tech companies for talent. If a US tech giant wants a UK software engineer, it can usually have them; remote work means geography is no protection.

Hardware is different. If you make rockets, you can't do it remotely. UK hardware talent is badly underused, and an ambitious startup will attract the "10x engineer" types, often bored in a corporate job and waiting for something worth joining. You'll get to them before the competition heats up.

The UK is undersupplied with ambitious hardware startups. The incumbents aren't particularly ambitious, top VCs have started to twig, and there's loads of great research to feed off. Instead of the next fintech app, why not build the next ARM or Dyson?

The Window is Closing

This arbitrage won't last forever. People are realising it in real time. Those who get on the train early will do very well; the rest will be chasing from behind.

The Hardware Revolution Starts Now

Wake up, UK. Our engineering talent is our nuclear fusion. Ignite it or lose the future.

VCs: invest in cobalt and circuits, not code.

Founders: stop running to the US. London can be the hardware capital of the world. We have the creativity and the talent. You bring the audacity.

Engineers: use those billion-dollar brains to build empires, not apps. While the world obsesses over the next GPT wrapper, you could be building the next industrial revolution.

UK, it's time to build.

Braindump by Josef Chen