Startup Advice

Brexit: how would a business approach the divorce bill?

Christian Nellemann

If a change does lead to progress, the cost doesn't matter

It’s safe to say that everyone is getting quite bored by the lack of progress in the Brexit negotiations. And given what these negotiations mean, and the implications they will have for all of us, that’s frightening.

Like everyone, I’m frustrated and a little bewildered by it all. But to try to get a handle on things, I’ve been thinking about how a business might approach a similar situation. I appreciate politics is a different beast and far more nuanced, but I wonder whether some practical business thinking is needed.

If a change does lead to progress, the cost doesn’t matter

The Brexit equivalent for a business would be a major restructuring project – some fundamental changes to the company triggered by a belief that those changes would lead to long-term benefits. That would potentially mean changes in personnel, changes in processes, and possibly even changes in suppliers. And we’d see the associated expense as a one-off restructuring cost.

Now, like anything in life, I could do that on the cheap. But clearly, to retain trust, brand and value, I would want to be quick, decisive and indeed generous. If the long-term gains really were there, I wouldn’t spend months bickering over these costs. Nor would I spend months bartering over anything else.

Or to put it another way, redundancy payments should be generous, and suppliers shouldn’t be screwed. Squabbling over redundancy packages would be a hugely negative move, and incredibly short-sighted too. Who knows when your paths might cross again? And how would future suppliers behave towards you after witnessing this? Chances are, you won’t get preferential treatment – or indeed, preferential rates.

The point is that delays, wrangling and tit-for-tat negotiating would set the worst possible tone – and on the contrary, generosity would set exactly the right one. And to maintain any sense of control and momentum, I’d need to be resolute. Because ultimately, if the outcome is as good as we’ve said it would be, why would we be fighting over the costs of making it happen?

Doubt and tension would flood through my business, just as it has this country.

Pay the bill, guarantee EU citizens’ rights, and move on

The value of our currency and the mood of the UK is suffering because of a lack of backbone.

You can’t convince a country to leave a union, and then stutter nervously and fearfully through the very first hurdle.

You also can’t use 3 million people as bargaining chips when you’ve been using them for years to grow your economy and help fund your services. These are things you cannot do if you want your credibility to stay intact.

If leaving the EU is going to propel us to a glorious future, why argue over £40 billion? Why not pay £60 billion and move on. Does the future not hold opportunities that will more than repay the difference? Because if not, why are we actually leaving?

Meanwhile, if you don’t want your reputation further tarnished, be bold enough to offer clear, uncompromised guarantees to EU citizens. Instead, May has offered ‘settled status’, and 96% of EU citizens in the UK reject it. It’s a farce – too little, too late.

Once again, I imagine how I might approach a similar challenge in business. And if I were to use employees as bargaining chips when negotiating over the future of my company, I’d deserve to fail. It’s cowardly leadership – and history won’t forget it.

We need answers. But all we have are questions.

This political situation is hugely complex. Like most of us, I’m aware of the mind-boggling amount of work that has to go into leaving the EU. This is unprecedented in scale.

In light of that, I think your only option is to deal with the present in the most pragmatic way possible – and that’s the point I’m making here. I don’t see any pragmatism at all. Common sense says that, whether each of us wants to leave the EU or not, what we definitely don’t need is more doubt, more worry and more unanswered questions.

And currently, that’s what Brexit is – one huge unanswered question after another. So how do you start rebuilding trust? Start answering questions.


  • Christian Nellemann is the Founder and CEO of XLN, a provider of low-cost phone, broadband, energy and card processing services exclusively to small businesses. A serial entrepreneur, he’s a two-time winner of Ernst & Young’s Entrepreneur of the Year award and one of only 17 inductees into their Global Hall of Fame. He is passionate about small businesses, and is a featured columnist for Follow him on Twitter @christianxln