By Ray Brimble

Looking back on it, January 2016 seems placid now. The US elections were still months away, the World Economic Forum was projecting 3.4% global growth in 2016n, world news by the standards of the last 10 years was low-key, and the U.K. appeared relatively happy to be “European”. Against this backdrop, science executive Tim Derrington and I agreed to acquire one of the largest and most famous marine ecology testing labs in the world, the venerable Brixham Environmental Laboratory, in Devon County, England. Situated on a scenic cliff above one of Britain’s most historical bays, this laboratory had been performing some of the best scientific analysis of effects of pharmaceuticals, chemicals and other manufactured substances on marine life for almost 80 years. Makers of these substances are required to perform marine toxicology testing to get certification before marketing their products. The laboratory had been an in-house scientific testing laboratory for the pharmaceutical giant Astra Zeneca for many years before they determined that outsourcing these services would be more advantageous. So, there they went, and here we came.

We launched in early 2016 as Scymaris LTD. Our crack science team was led by Dr. Michelle Fox, a former Astra Zeneca eco- toxicologist, and renown British reality show star, by virtue of her prominent role as a member of lifeboat rescue team around which a very cool BBC TV series, called “Saving Lives at Sea”, had been built- think “Deadliest Catch”. Little did I know that this would serve as a humorous metaphor for our team when we launched our operations into a storm called Brexit some months later.

Michelle will tell you to never launch your boat in foul weather conditions. Mariners do anyway, so she and her volunteer crew make a hobby of going out to sea in the most inclement weather to fish them out of the raging sea. Yes, the volunteer sea rescue squad does this for fun… go figure?

Back to Scymaris, what was our logic in launching the new venture in the middle of Brexit? First of all, I talked to very few folks who thought Brexit would actually be approved. All of the “smart money” assumed this was a political stunt, made no sense, and would soon be over after the scheduled summer election. At dinner in London in March I polled the eight people at the table about their voting intentions. These were all educated, successful folks. Seven said they would vote no, but I was surprised by one person, who coincidentally happened to be the wealthiest of the group, saying they would vote yes. What appeared to be a landslide no vote suddenly seemed a strangely possible yes vote after this encounter. Nevertheless, I paid no mind. Those clouds in the horizon? Just a few thundershowers. Launch the boat! A little rain never hurt anybody!

June 23, 2016. UK votes to leave the EU… Brexit! Tim Derrington calls me on a Saturday night to ask me if I still want to move forward with the company. The staff, Michelle, everyone needs to know if I am still “in”. Of course, this was like asking the captain of the boat if he still wants to sail after we are 20 miles out to sea with no land in sight. I admit that I immediately did some soul searching. What would Brexit mean to our small company? Would it fundamentally change conditions on the ground so much as to change the economics of our plan? And how fast would these effects take hold? Finally, would Brexit really even happen, irrespective of the vote? In short, how much would these macro events affect our micro situation up on the cliffs above Brixham Bay?

It is now the fall of 2017. Has Brexit mattered? Even though no final deal has been struck between the EU and the U.K., there has already been a certain effect on our business. However, surprisingly many of these have been positive. For instance, the value of the Pound Sterling has gone down with a twofold effect. Since my capital investment was based on the floating exchange rate between the euros I wanted to use for the investment and pound denominated capital I would be investing in the company, as the pound weakened, the amount of money I actually had to put in the company was far less. I acquired this company for over 15% less than I expected, solely because of the devaluation of the pound. Similarly, since many of our customers are outside of the U.K., but our pricing is in £, our services pricing has gone down. For non-U.K. customers we are more competitive and our sales have grown faster than projected.

However, all is not rosy. The cloud of uncertainty has definitely not helped. Business hates uncertainty and right now, it feels like being in a canoe rushing headlong down a river, knowing there is a waterfall approaching and we are going over it, but not knowing how high it is, or what lies below it. All we can do is hold on tight. Another negative factor is that our business depends on availability of very specialized scientific talent. Luckily two universities in our vicinity, Exeter and Plymouth, excel in marine ecotoxicology and produce an excellent stream of BS, MS and PhD candidates in our field. Nevertheless, I can see the day when we might need to recruit abroad. Will it be difficult to bring the best talent to the U.K., no matter what Passport they hold? Then there is the matter of a “no deal”, or “bad deal” Brexit result. Will the United Kingdom’s potential inability to maintain a friction free trading environment with their European neighbors make us less competitive? In short, how do we plan to grow our business in the EU, if we do not even know what the rules and costs will be?  This leads to planning by contingency. Having a Plan B is always good, but maintaining a Plan B (and C, D, E) ultimately burns resources, time and energy.

A final thought: how much of your business strategy should be based on Macro-trends like Brexit? I have always thought that the global commercial opportunity landscape is “lumpy”. It is possible to find good deals and execute profitably in most economic conditions, if only you can find the right deals, in the right place for the right price. For this reason, I have often joked, “Macro is for chumps”. The challenge for Scymaris, as well as any other business launching during the Brexit talks is to ensure that the fundamentals of the business are sound, and the unique sales proposition of the business remains compelling through multiple macro outcomes. In other words, try to concentrate on the “micro” at least as much as the macro. But if the last few years have taught us anything, it’s that predicting the future is risky business. Therefore, no matter how much you predict and plan for the future, make sure your boat is seaworthy and prepare to get a little wet if necessary. A little rain never hurt anybody.