Investment in UK tech hits record high

The UK tech sector overtook European rivals in investment during 2019 and its rate of growth was greater than that of global leaders, the US and China.

David Sapsted

16 January 2020

Investment in the UK tech sector reached a record high during 2019, with the nation attracting a third of the total ploughed into the sector across Europe as a whole.Eight unicorns – companies worth more than $1 billion – were created in Britain during the year, with fintech start-ups leading the way.Data from the government's Digital Economy Council showed that investment in the tech sector reached £10.1 over the year, £3.1 billion more than in 2018 and a third of the £30 billion raised throughout Europe.

UK tech growth beats global leaders

The research by Tech Nation and Dealroom.co showed that while the UK sector outstripped investment in European rivals such as Germany and France, the rate of the growth in British tech was greater than that in the US and China, the global leaders.Sadiq Khan, London's mayor, says, "Our city is the undisputed tech capital of Europe and the record $9.7 billion investment in this sector clearly shows London open to talent and investment from all over the world."London's successful digital economy is not only an important source of jobs for Londoners but is also bringing prosperity and growth to the rest of the UK."

Six UK cities push ahead with raising venture capital

Additionally, the research found that venture capital investment increased by 44 per cent over the year. It meant that, in addition to London, five other UK cities ranked among the top 26 cities in the world for raising venture capital in 2019: Cambridge, Bristol, Oxford, Manchester and Edinburgh.London itself – where companies raised £7.4 billion last year – now sits only behind San Francisco, Beijing and New York in a league table of the world's most-funded tech locations. On a global scale, the UK's performance last year was only bettered by the US and China in terms of total venture capital funding.Digital Secretary Nicky Morgan adds, "Our tech companies are not only commanding the confidence of global investors, but they are also creating new jobs and wealth across the country."It's absolutely vital we maintain this impressive success and in government we are working tirelessly to make sure the conditions are right."

Increased confidence among UK tech start-ups

A separate report produced by Studio Graphene found that confidence among UK tech start-ups increased in the last quarter of 2019 despite election disruption and the looming Brexit deadline.The quarter's 'Tech Tracker', based on research among more than 100 start-up executives, found that 74 per cent were ‘confident’ or ‘very confident’ they would increase turnover during the course of 2020.

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Additionally, 77 per cent expected to hire more staff over the course of the year in the coming 12 months, although 69 per cent said they were worried Brexit would make it harder for them to hire the tech talent they needed.A similar percentage said they would support the government's proposed introduction of a points-based immigration system if it ensured more skilled tech workers could enter the UK.