The boss of crowdfunding platform Seedrs has warned that the UK competition watchdog risks stifling government ambitions to create a booming tech sector after it blocked his merger with rival Crowdcube.
On March 24 the Competition and Markets Authority (CMA) announced that it intended to prevent the tie-up between the two crowdfunding businesses, arguing it would restrict competition and result in higher fees and less innovation.
The backlash from Seedrs underlines a growing nervousness about the lack of innovative companies in the UK, which faces the possible exit of top software groups such as Arm, while the CMA is struggling to balance the need for innovation with the threat from digital mergers.
Jeff Lynn, co-founder of Seedrs, told the Financial Times that the CMA had taken an “old fashioned and academic view of competition law that fails to recognise the realities of how innovative sectors work.”
The deal was pulled after being provisionally blocked. Lynn said there was a “real divide between the political impetus to see us build some great businesses in this country and a much more narrow-minded perspective from the CMA.”
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