UK tech sector heading within the correct direction for one other file year of funding

The UK creates one unicorn tech industrial every week, as startup funding all the most sensible likely draw thru the predominant half of 2021 rockets to £13.5bn

Sebastian Klovig Skelton

Sebastian Klovig Skelton ,
Senior reporter

Published: 20 Sep 2021 0: 01

The UK is constructing almost $1bn “unicorn” expertise industrial every week after inflow of £13.5bn enterprise capital (VC) funding within the predominant six months of the year, environment the tech sector up for one other file year of funding in 2021.

In accordance with knowledge compiled for the UK’s Digital Financial system Council (DEC) and entrepreneurial network Tech Nation by knowledge supplier Dealroom.co, the UK is now dwelling to 105 unicorns.

Out of these, 20 reached unicorn field within the predominant six months of 2021 by myself, including Tractable, Zego and Depop. By comparison, Tech Nation claims it took from 1990 to 2014 for the UK to compose its first 20 unicorns.

From these 20 companies, 11 are monetary expertise (fintech) companies, which as a subsector attracted £4.2bn of the total raised. After fintech, healthtech attracted the 2d highest quantity (£2.7bn), adopted by enterprise software program (£1.3bn), and transportation (£1.1bn).

The different of capability future unicorns has furthermore elevated, from 132 companies in May perchance well simply 2021 to 153 within the most modern figures.

The £13.5bn funding file can in segment be attributed to a handful of “mega fundraising rounds” by UK tech companies, including £578m raised by challenger bank Revolut (the UK’s single most tasty tech company), £289m by cyber security platform Snyk, and £1bn by automobile gross sales platform Cinch, amongst others.

Extra than half of all funding rounds raised within the old year contain furthermore considered over £100mn price of funding, with around 1,700 startups and scaleups in total receiving capital backing.

“The UK tech replace is heading within the correct direction for one other file high in terms of funding in 2021,” talked about Tech Nation founder and chief govt Gerard Grech. “The success of established companies treasure Wise, Darktrace and Depop indicate there’s a clear pathway for UK tech companies to make an affect on a global scale. At Tech Nation, we are able to proceed to make stronger entrepreneurs and startup founders as they develop their companies from first funding cheque the whole attain to IPO.”

Russ Shaw, founding father of Tech London Advocates and Worldwide Tech Advocates, talked about the file phases of funding and different of unicorns indicate that tech companies are driving the UK’s submit-Covid financial restoration, as properly as serving to to consolidate its field as the worlds third largest global tech ecosystem, after the US and China.

“Here’s no longer a memoir ravishing about London, or ravishing about fintech – UK tech has confirmed it’s able to producing world-class tech companies in AI [artificial intelligence], biotech and cyber nationwide,” he talked about.

“After the challenges so many companies faced all the most sensible likely draw thru the pandemic, this day’s knowledge recognises the phenomenal resilience and success of British tech companies, and sends a clear message to the worldwide tech neighborhood sooner than Europe’s largest tech competition, London Tech Week – the UK is a global tech powerhouse reaching a dimension and scale that can presumably compete with any individual on the arena stage.”

Echoing these sentiments, Nicola Mendelsohn, vice-president of Europe, Center East and Africa (EMEA) at Facebook and a member of DEC, added that the UK now has “management field” alongside Silicon Valley and China.

“Here’s an exhilarating time to be segment of this replace, and we ought to be encouraging talented young folks to sign that the most tasty careers of the future could perchance furthermore be gift in these companies that are constructing innovative products and services that motivate companies and participants,” she talked about.

The UK has previously attracted file phases of funding in 2017, 2019 and 2020, and regardless of a 28% dip in enterprise capital funding all the most sensible likely draw thru 2018 – which modified into largely attributed to the political uncertainty surrounding Brexit on the time – UK tech companies serene managed to spice up £2.49bn.

Nonetheless, in 2020, around 20% of the total funding went to ravishing 10 scaleups, eight of which were London-basically basically based.

Through the pandemic, better than £1bn of convertible loans were issued to a total of virtually 1,200 startups thru the authorities’s Future Fund programme, which modified into launched in April 2021 by finance minister Rishi Sunak to make stronger startups and loss-making companies with the funding wished to stop afloat all the most sensible likely draw thru the pandemic.

The British Industrial Financial institution published on 14 September 2021 that, as a outcomes of the Future Fund loans, the authorities now has equity stakes in 158 high-progress startups.