Making moonshots when policy is in flux, with Sarah Hunter
Welcome back to The Form Playbook, our newsletter supporting founders building in markets where policy matters. Form is the only fund dedicated to helping founders understand, navigate and build where regulation is a driver of success.
This month:
🎙️ Interview with Sarah Hunter, Director of Global Public Policy at X, on the journey to make moonshots happen even while policy is in flux
📰 News & Views: All change at the top of the UK government…again…while emerging tech regulation work quietly continues
⏰ Form Updates: Congrats to Hoxton Farms on their $22m Series A, and Leo at Labour Conference
Sarah Hunter, Director of Global Public Policy at X, on making moonshots when policy is in flux
X works on moonshot technologies that sound like science fiction. Naturally, these projects bring both policymaker intrigue and scrutiny. Sarah Hunter, X’s Director of Global Public Policy and a former Special Adviser in No. 10, works to manage this both internally — helping product and business teams understand how the world will respond to their ideas — and externally — helping build trust and enable partnerships with decisionmakers. Given the UK’s recent political tumult, we caught up to hear how founders can build and deploy radical new technologies, even when government is in flux:
Sarah’s Advice for Founders:
To understand what a change in government or policy direction means for your business, pay attention to how hard or easy its going to be for a Government to enact their plans. Governments can talk a lot about what they want to do, but actually getting it done is another thing entirely. Many policies get quietly shelved in the first few months as the realities of governing become clearer and decision makers have to prioritise. They need to bring others onboard and that is often very hard, so find ways to build alliances that can get your messages across to the new people in power.
To get support for policy change to enable your technology, identify the big problem in the world that your radical solution is going to solve. Policy makers generally go into public policy to solve problems too — if you can align your solutions to their problems then you often find common ground to try new things.
Why public policy matters for start-ups and VC: If laws or regulations change, your business model and or forecasts need to change with it. But it’s also not always a problem: changing policy and regulation is now a tailwind in some markets - e.g. in sectors that intersect with carbon reduction or climate adaptation - and could make business models more robust.
Find the full interview transcript below.
News & Views
Quick take: It’s second time lucky for Rishi Sunak. But with a new Cabinet and a deep fiscal shift now required, don’t expect every pledge from the summer leadership election to be maintained. That said, one beneficiary is likely to be crypto: as Chancellor, Sunak championed a new regulatory regime for cryptoassets and pushed the FCA to take a more enabling approach (more below). This momentum seemed like it might stall under Truss, but with the new Financial Services and Markets Bill now in committee stage, expect things to pick up quickly.
Dig deeper: Amid the political chaos, many founders may feel pessimistic about the UK’s ability to enable and regulate emerging tech. No doubt, political uncertainty & delays do have costs — especially if start-ups need legislative change — but away from the upheaval, other bits of the UK are getting on with the job:
Crypto: The FCA is working with the crypto industry to develop a regulatory framework covering asset disclosures and custody, consumer protection, and regulatory hooks in a global, decentralised ecocsystem
AVs: The Centre for Autonomous & Connected Vehicles aims to establish the legal and safety framework for AVs by 2025, including consulting to ensure AVs are as safe as human drivers.
Future of food: The Food Standards Agency is working to help bring alternative proteins & novel foods to market, developing guidance for plant-based meat substitutes, alternative proteins and cultured meat
Digital health: The MHRA and NICE are exploring how to regulate digital mental health tools and software-based medical devices, covering thresholds for medical device classification, risk classification, and clinical evidence review.
AI: The Office for AI is establishing a pro-innovation approach to regulating AI & avoiding some of the EU's more heavy-handed interventions. This follows work by the CDEI on AI assurance and sets up an AI White Paper due later this year.
At Form, we map, monitor and translate what really matters into strategic choices on product, go-to-market, funding, hiring & much more. Regulatory risks and opportunities that shape companies' ability to scale are always in play, whatever's going on in SW1. Get in touch if you’re a founder looking to win in regulated markets.
Form Updates
Hoxton Farms, our portfolio company leading a revolution in cultivated animal fat, raised a $22m Series A led by Collab Fund and Fine Structure Ventures. This round is a huge testament to their vision and execution, and we can’t wait to see what’s next. Catch up on last month’s newsletter to hear about their experience building at the regulatory and technological frontier.
Leo joined Shadow Innovation Minister Chi Onwurah MP and Policy Exchange at the Labour Party Conference to discuss how the tech sector can support growth — and how to upscale the UK digital economy.
We’re heading to Helsinki next month for Slush and we’re organising a get-together for founders, investors, and tech policy folk — drop us a line for more info.
Full interview with Sarah Hunter:
FORM: X works on projects at what we call the ‘regulatory frontier’ — whether that’s AVs, drones, balloon-based internet, and climate projects. How can policymakers get comfortable with encouraging radical solutions that test the boundaries of public policy?
SARAH HUNTER: At X we work on technologies that sound like science fiction — and policy makers across the world are often excited to hear about whats happening on the cutting edge of science and technology. But if you need to get support for policy change to enable your technology, the most important thing is to be able to identify the big problem in the world that your radical solution is going to solve. Policy makers generally go into public policy to solve problems too — and if you can align your solutions to their problems then you often find common ground to try new things.
Your role is as much about talking tech to policymakers as it is about talking policymakers to technical colleagues. What role does your team play internally?
My role at X is very different role to a ‘traditional’ Government relations job. When your technologies are many years away from launch, and subject to pivots and changes along the way, a lot of our time is spent advising product and business teams on how the ‘real’ world will react to their ideas.
How does policy shape internal conversations and decisions? Can you share an example of how policy/regulation have played a role in bringing a radical technology to bear on some of the world’s hardest problems?
Historically, new policy and regulation has played a strong if silent role in bringing new technology to market — Marianna Mazzucato has written a lot about how important the public sector has been in bringing technology innovations into the world. The clearest present day example of the positive impact policy has on technology is in climate change. In many countries, Governments are actively using policy tools like tax and regulation to support the more rapid expansion of technology to reduce carbon emissions. In the US, the combination of the CHIPS Act, the Infrastructure Act and the Inflation Reduction Act will be like rocket fuel for climate start ups. For a technologist, this is a huge opportunity and anyone who ignores it will be left behind by their competitors
You’ve been an adviser in the UK government. With a new government comes a new policy agenda, new constraints, and new departmental fights over scarce time & resource — creating both uncertainty and opportunity for companies. What do start-ups need to understand about the transition that new governments bring, how government really works, and how to respond?
New Governments are always pretty chaotic behind the scenes. Theres a lot of swirl and many policies get quietly shelved in the first few months as the realities of governing become clearer and decision makers have to prioritise their to-do list. The key thing to pay attention to is how hard or easy its going to be for a Government to enact their policies. Governments can talk a lot about what they want to do — but actually getting it done is another thing entirely. They need to bring others onboard — Congress, Parliament, Agencies etc — and that is often very hard. Find others who share your interests and find ways to build alliances that can get your messages across to the new people in power.
You’ve spoken about the need for VC to build public policy capability — this is why Form exists. What’s behind your thinking?
Public Policy is a key building block in market making. If laws or regulations change, your business model and or forecasts need to change with it. I’m always surprised at how confident start ups are about their forecasting without a true understanding about how their sector is being regulated. Investors should have a much better informed critique of those forecasts. But it’s also not always a problem — in sectors that intersect with carbon reduction or climate adaptation, for example — changing policy and regulation is now a tailwind in some markets and could make business models look a lot more robust,
What’s one tech issue or sector where the UK could and should lead, but isn’t yet? What change would you like to see?
Climate tech. The scale of transitioning our global economy off fossil fuels is just enormous. It’s a daunting challenge but that’s also what makes it a big opportunity. The UK — with its dense concentration of engineers, entrepreneurs, capital and corporates — could genuinely take a lead here. I’d like to see a Government who champions this as a growth and export opportunity, supporting it in the way the Biden Administration is doing in the US right now.
As always, get in touch if you’re a founder or investor working out how to win in regulated markets: