It's always strange going back to the country I grew up in. I spent my early academic and professional life there in a near-constant state of frustration, so it's hard for me to analyze it rationally. Bearing that in mind, here's some of the impressions I was left with after spending a week back in London.
High Finance. I was there to help out some startup friends, and their biggest problem was that big financial firms could easily outbid any early-stage startup for technical talent. If an experienced developer can get $500,000 a year, it takes a lot to lure them. This might sound great for developers, but only if it's a long-term, sustainable situation. My fear is that the current high levels of financial firm profits won't last, those jobs will vanish, and without a widespread startup culture there will be no good replacements. Felix Salmon did a great article on the problem of finance sucking up all the oxygen, and I think he's spot on. I don't have figures to back this up, but even New York with its massive finance industry feels like it has a lot more diversity to fall back on than London.
Deference. There's a real reluctance to give young punks responsibilities, and a separation between management and engineering. As a 25 year-old with big ideas, the difference between what I was allowed to do in British and American companies was amazing. I went from getting into trouble to being given pats on the back for coding outside of my assigned areas. I was included in management discussions, not kept in the dark. The conservative social system in the UK makes it tough to be flexible like that, and discourages a lot of troublemaking innovators.
Don't look! Keep your eyes focused on the ground five feet in front of you at all times when walking. I hadn't realized how much my habits had changed until I was wandering around London and wondering why everyone was bumping into each other. Do I walk like an American now?
Drip-feeding. European investors are complete wimps. They have the terrible habit of handing out investment in tiny chunks. This forces entrepreneurs to constantly be fund-raising, unable to plan more than a couple of months ahead. I talked to several startups with traction that would earn them millions in VC investment on the west coast, and they're all struggling with this issue. I'm not the only one to have spotted the problem, though Paul has different ideas on the cause.
Raw Potential. Despite all these criticisms, I met so many clever, motivated people and great startups. I'm just a tourist there these days, so my hat goes off to everyone working to make London the tech innovation hub it deserves to be.