Brexit-hobbled Britain ‘still tech powerhouse of Europe’

UK-based tech firms have attracted capital funding worth a total of almost $50bn (£37.4bn) in the past five years, including $12.5bn in the past 12 months alone, newly published figures show.

The UK’s “impressive” tally since 2016 represents 36% of all European tech investment in the period, according to venture capital firm Atomico’s The State of European Tech report.

And despite the uncertainty surrounding Brexit and the economic impact of the Covid-19 pandemic, the amount of money pumped into tech start-ups in Britain in 2020 is double that raised by Germany and France combined.

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Celebrating the findings, Culture Secretary Oliver Dowden said: “The UK is the tech powerhouse of Europe. We want to make sure that UK tech comes out of the Covid-19 crisis stronger than ever - supporting the sector through the recovery just as tech supported all of us through the pandemic.

“Our forthcoming digital strategy will unleash the full potential of tech innovators and entrepreneurs across the country, driving a new era of growth. The UK has long been one of the best places to start and grow a tech business and we intend to keep it that way by taking an unashamedly pro-tech approach.”

London: Europe’s tech capital

London remains the “undisputed” tech hub in terms of capital invested, attracting $9.59bn in 2020, says Atomico’s report. That takes the total won by firms in London since 2016 to $34bn.

Paris has attracted the second-greatest amount of cash, at $3.4bn in 2020, and $11.7bn cumulatively since 2016. Meanwhile, Stockholm replaces Berlin in the final slot in the list of top three hubs in 2020, claiming $2.7bn in capital investment.

Time to go public?

Although London remains Europe’s tech capital, this “continued success could yet be hampered by a lack of a large British technology business floating in the City”, says The Telegraph.

“The only missing piece of the jigsaw for London tech is to have a true giant technology company go public in the UK,” according to Tommy Stadlen, an investor at Giant Ventures who sold his start-up Swing to Microsoft in 2017.

He told the paper “the impact of that is it creates huge numbers of tech-savvy millionaires who go on to become angel investors. “Until we get those companies, we’re never going to put together a Silicon Valley.”

Capital invested ($m) in the UK, cumulative since 2016 and per year

Capital invested ($m) by country and by year

Graphics: dealroom.co / stateofeuropeantech.com