Sadiq Khan pitches London as AI hub despite sector concerns
Sadiq Khan today championed the capital as an open, “values-led” tech hub, telling international investors that London “will always remain open to talent” and is “resolutely pro-growth”, even as sector voices warn of structural barriers limiting UK competitiveness.
Speaking at the inuagural SXSW London’s opening, the Mayor of London framed the capital as a “creative hotbed” and “gateway to the world” for innovation, claiming that London’s blend of political stability, academic strength and ethical leadership makes it an ideal launchpad for cutting-edge technologies like AI.
“We’re pushing hard to make London a global centre for AI investment and innovation”, Khan said. “But I want the defining technologies of the 21st century not just to be pioneered in London – but be shaped by our values”.
He highlighted local uses of AI in diagnosing cancer, improving air quality, and reducing suicide rates, citing over 3,100 AI firms now operating in the city.
London, he added, now attracts more tech investment than the next three European cities – Paris, Stockholm and Berlin – combined.
But while the Mayor’s tone remained bullish, industry leaders have argued against Khan’s rhetoric, saying it risks being outpaces by more sobering realities.
Notably, London recently saw the collapse of one of its best-known AI unicorns, Builder AI, while earlier this month London-listed Deliveroo agreed the terms of a takeover by its larger US rival Doordash, and fintech giant Revolut chose Paris as a base for continental European expansion in a what as seen by some as a blow to London.
Immigration and the innovation gap
The mayor’s speech comes just days after the UK government published its long awaited immigration white paper, pledging to tweak skilled worker visa routes, expand high potential individual pathways, and reform the ‘global talent’ scheme.
While the proposals were broadly welcomed by deeptech investors, many argued they fell short of the scale needed to support early stage founders, raising concerns that claims of reducing net migration could drown out signals of openness.
“The startup ecosystem runs on global talent, but the system is still too slow and too costly”, said RTP global investor Ewa Kompowska. “This is a step in the right direction – but not yet the leap we need”.
The sentiment was echoed by Chris Erven, co-founder of KETS Quantum Security, who warned that the white paper’s focus on elite hires overlooks critical mid-level talent.
“Founders don’t just need rock star engineers- they need product managers and developers, too”.
The tension points to a wider credibility gap.
Despite London’s continued appeal, sector bodies have warned that the UK has struggled to convert early-stage breakthroughs into growth-stage scale-ups – an issue long linked to both talent constraints and patchy access to domestic capital.
What’s more, visa applications under the skilled worker route have dropped 20 per cent year on year following hikes to salary thresholds and application fees.
The white paper shows signs of a potential policy pivot, but questions remain over its alignment with the nation’s wider industrial ambitions.
“The government’s goals of reducing migration while attracting top global talent might seem contradictory”, said Sacha Woolridge, head of immigration at law firm Birketts. “But, they can work together – if the system is designed to fill urgent gaps and support long-term development”.
Online regulation and platform accountability
Khan also addressed the ethical responsibilities of tech platforms in Monday’s speech, warning that “freedom of expression doesn’t mean freedom to incite hatred or threaten lives” – a likely nod to recent controversy over Meta’s removal of its fact-checking filters.
“When somebody sacks the staff responsible for taking down dangerous messages and builds algorithms that reward bad behaviour, that should worry us all”, Khan said.
“I’d rather the industry act responsibly than we’re forced to change the law”.
The remarks come amid continued debate over the UK’s online safety act, which comes into force in July, which places new obligations on platforms to prevent harm but has faced criticism from industry for legal ambiguity and from free speech advocates over its broader chilling effects.
Value versus velocity
Khan’s pitch to global investors is clearly designed to differentiate the UK from more turbulent tech markets like the US, where regulatory rollbacks and political polarisation have spooked some investors.
But sector insiders have warned that values alone won’t be enough to drive growth unless underpinned by sustained structural reform, without which London will fall behind in the tech race.
Just a couple of weeks ago, Paris overtook London as Europe’s leading tech hub for the first time, reigniting concerns over the competitiveness of the UK’s biggest city for a vital sector.
“We want London to be a place where you can pioneer AI and have conversations about what the ethics involved are”, Khan added.
But as Tech London Advocates founder Russ Shaw put it earlier this year, “The innovation is here – but unless we get the right policy infrastructure across immigration, funding and regulation, growth will continue to happen elsewhere”.