Tech and policy in 2026

Last January the Form Ventures team made four tech and policy predictions for the year ahead. How did we get on? Read ahead to find out, for our predictions for 2026, and for a recap of Form’s 2025.

2025 - were we right?

• We said: “Do or die for UK growth policy”. The Budget at the end of 2024 had bruised startups and corporates alike and we thought 2025 would be the defining year for UK growth policy. Instead, Budget 2025 became a question of survival for the Chancellor and despite some welcome tweaks to startup tax, there hasn’t been a step-change. U-turns across the board and a drumbeat of rebellion from within the party reveal that growth is a priority, not the priority. So it’s been “limping on” rather than “do or die”: nil points.

• We said: “The year of proving who you are online”. We could see Ofcom age verification rules coming into force mid-year and knew that restrictions would be controversial - but even we didn’t predict the level of US backlash regarding how it would affect US tech companies. This has snowballed into a fierce debate over Grok’s creation of deepfakes and the UK’s willingness to go harder on online safety enforcement. But just this week, the UK government has U-turned on mandating digital ID, despite rolling out its own digital ID app. On balance, a point.

• We said: “Agentic AI reaches deeper into regulated markets”. We predicted that we’d see AI agent startups reach into the more sensitive parts of the value chain - such as patient handling in healthcare, or in the flow of funds in either consumer or enterprise use cases. This feels like it’s only just taking hold. Many of the most exciting agentic startups in regulated markets are still one step removed from the most sensitive users and data - like OpenEvidence in the US, which doesn’t directly touch patients. That said, last week’s launch of ChatGPT health last week feels like a huge step forward. Half a point.

• We said: “The crisis in UK and European capital markets reaches its peak”. The clamour to do something extreme to revive European public markets is certainly increasing, but may not have peaked. Having the German Chancellor Merz push for a single European stock exchange is certainly a step in the right direction, and there has been some progress on the EUInc proposal for a “28th regime” to simplify startup law in Europe. Half a point.

Score: 2/4

2026 predictions

1. “US vs Europe” begins to balkanise the VC market. The Trump administration’s explicitly anti-European stance, and market distortion in favour of US tech, forces VCs to pick more carefully between US-sponsored players and a new crop of Europe-native competitors. The rise of “sovereignty” as the defining geopolitical lens creates space for European capital to back European versions as the geopolitical and regulatory reality of the US changes. But at the very early stages of the market, the growing trend of European firms domiciling in Delaware (which will continue) complicates this - as “home-grown” UK/European tech companies are legally US from inception.

2. A political movement to protect labour from automation builds momentum. As AI automation gathers pace, politicians will begin to push back on the upheaval - as we’re seeing in California. New polling by FGS shows that the biggest gap between public sentiment supporting regulation, and political appetite to regulate, is on AI. Pro-regulatory consensus among the public is strong (>80%), global and includes significant tax rises on AI firms. It’s also bipartisan in the US. Either individual politicians, or potentially a whole party, will start to try to capitalise on this public sentiment at some point in the near future. Will we see a popularist “humanist”/ anti-AI party emerge?

3. Biometrics has its moment. Another prediction related to digital ID - but biometrics specifically this year. We think 2026 could be the year biometrics take off in the UK. The signs are everywhere - palm payments have been big in China for some time; biometric access is becoming common in the western world (take the new JP Morgan office in NYC). We think the UK will follow suit - by the end of 2026, over 10% of the working age population in London will have paid for something via biometric method (palm, most likely…).

4. Falling migration figures create a platform for a pro-tech migration narrative. A lot has been written in recent weeks about the potential impact of declining net migration figures on the political landscape (e.g. where does Reform’s pitch go if the migration tailwind evaporates). What we’re interested in is the downstream impacts on the tech industry. We’re predicting (hoping?!) that it will create a platform for a more rational debate on the importance of international talent for the UK’s key sectors. If we don’t want to miss the AI boat altogether, we need to make London a top destination for AI talent, and proactively seek them out across the globe. That’s not to mention other key labour shortages. Take social care - we expect the inevitable staffing shock to the system will be sufficient to trigger a conversation about (re) opening the door to international carers, enabled by less political pressure on overall net migration numbers.

Form’s 2025

New portfolio companies

We backed four teams, each of which drove home the theme of “founder-market fit”. David at Firenze is the person to modernise Lombard lending through wealth managers. The Cracken team are some of the most capable technical cyber specialists in the world, bringing front-line expertise to large institutions and national infrastructure. Claire at Untap is about as passionate about mass infection prevention as is imaginable. Rachael at Lifted has been building in social care for five years already, and we know it’s a lifetime’s work underway.

The existing portfolio

We’ve had incredible breakthroughs from companies like Five, who are facilitating the first palm based payments in Europe; Snoots, the only vet business to offer a truly affordable, universal primary care product, opening its first crop of London clinics, before heading stateside; and Flok became the first healthcare company in Europe to offer end to end AI as a medical device, including diagnosis (covered by BBC News among others).

Stotles announced its £10m Series A, underscoring its position as the public sector go-to-market operating system. We had three unannounced follow on rounds in Q4 alone and three more term sheets signed in the last two weeks. By the end of Q1 we expect a third of the Fund II portfolio to have raised up rounds in the space of six months.

Fund I continues to be top-decile for its vintage.

Building Form the business

In the spring, we were delighted to introduce the Form Scouts - policy leaders from twelve of the most successful venture-backed companies. These individuals are often the first to know when a talented team is spinning out of their businesses; but they’re also right at the frontier of key debates on tech policy, which is a brilliant source of intelligence and network for the Form portfolio.

We continued to place ourselves at the heart of key debates on tech policy. The start of the year saw a flurry of coverage of our views: in the FT, Sifted and a CityAM op-ed on fixing the regulators, our flagship campaign.

That campaign saw traction including David Willetts’ appointment as chair of the Regulatory Innovation Office, HMT’s Regulatory Action Plan and later in the year the announcement of a new AI Growth Lab, where our quote in the government’s press release topped the bill from the tech community, including edging out YC 😉.

On a baking day in June we convened 12 VC partners with the senior team at the CMA to discuss how merger control really works for tech deals, and Leo interviewed Doug Gurr, CMA chairman, on stage at the flagship BVCA conference. We were delighted to see Kanishka Narayan MP, who joined our AGM in February, becoming Minister for AI in September.

And to round off the year, we’ve been joined by Etaine Lamy since November, who is currently studying for an MBA at Dartmouth. Drawing on her prior experience at the FCA and advisory firm Flint Global, she’s been an incredible addition to the team and has focused her time on exciting new plans for Form in 2026. Watch this space!