British technology companies have attracted three times more venture capital (VC) investment in the two years since the vote to leave the European Union (EU) than any other European country, with London’s thriving fintech and artificial intelligence (AI) sectors leading the charge.
This was the headline finding of a report released by London & Partners ahead of next week’s London Tech Week, which revealed that not only do digital businesses now account for more than 80% of all VC money invested in the UK since June 2016, but collectively, tech companies have received more than £5bn worth of funding, £874m of it since January 2018.
The main source of this money remains the US, with American-based VCs funneling £3.5bn of the total amount to British shores.
This means that collectively, British businesses have scooped more cash than Germany (£2.15bn), France (£1.55bn) and Sweden (£644m) combined.
Businesses based in London helped it to remain Europe’s premier destination for VC cash, accounting for more than £4bn of investment, ahead of Paris (£1.14bn), Berlin (£814m) and Stockholm (£542m).
“London is the undisputed tech capital of Europe and today’s figures offer further proof that London remains a leading global tech hub for investors,” said London mayor Sadiq Khan. “With world-class universities and a diverse international talent pool, London is a centre for creative energy and innovation.
“London’s tech sector is an important source of jobs and growth for the city’s economy and it is vital that we continue to ensure we can attract the very best talent and investment from all over the world in the aftermath of Brexit.”
The report said investors were particularly attracted to London because of its strengths in developing fast-growing and cutting-edge technologies around areas such as AI, cyber security and fintech. It cited a number of recent deals in the fintech sector – up £1.7bn since June 2016 – such as a £211m injection for money transfer outfit TransferWise and £177m for mobile bank Revolut.
In AI, meanwhile, more than £400m of VC cash has flowed into local firms, including a £13m deal for autonomous robotics specialist Starship, and £12m for Realeyes, which is developing emotional AIs to help brands detect how people react to video content.
Sherry Coutu, London Tech Week ambassador and herself an angel investor, said: “With a high number of scale-ups and high-growth companies, it is no surprise to see that London and the UK continue to be a leading destination for international tech investors.
“From artificial intelligence to cyber security, edtech and govtech, the UK is home to companies that are leading the way in developing and implementing the latest cutting-edge technologies.
“This year’s London Tech Week will shine a spotlight on London’s mix of thriving start-up and scale-up businesses and a whole range of innovations. It’s a fantastic opportunity for London to showcase itself to global investors, entrepreneurs and tech leaders from across the world.”
London Tech Week 2018 will run from Monday 11 June to Sunday 17 June, with more than 200 events scheduled, welcoming over 50,000 entrepreneurs, tech investors and industry leaders to the city.