London’s tech sector continued to attract significantly more investment than its European rivals last year, despite the looming threat of a no-deal Brexit.
New data commissioned by the Mayor of London’s promotional agency, London and Partners, revealed that the capital’s tech sector attracted £1.8bn in 2018, nearly double its closest rival, Berlin, which raised £936.5m.
The data also highlighted a huge regional funding disparity between companies operating in and outside of the capital; London startups raised 72 per cent of the £2.49bn acquired by British tech firms last year.
“The fantastic success of our tech sector is rooted in our city’s openness and our diverse, international talent pool,” said deputy mayor for business, Rajesh Agrawal. “Regardless of the outcome of Brexit, London will remain open to innovation, talent and investment from all over the world.”
Investment in London’s tech sector was driven by in part by major funding rounds for AI companies, which attracted £736m, almost as much of all Paris’s tech firms combined. Graphcore, an AI chipmaker, raised £153m in series D funding, while online travel firm Culture Trip raised £59m in series B funding.
Funding for London’s cryptocurrency and blockchain companies rose by a factor of 10 last year to £200m. But the biggest share of the pie was reserved for fintech companies, which raised more than £1bn in 2018, propelled by major rounds for Revolut (£177m) and Monzo (£84m).
Russ Shaw, the founder of Tech London Advocates, said the UK’s tech sector had proved its resilience once again: “It is yet more encouraging to see that growth is focused in verticals of real international significance – big data, blockchain and AI technologies – these are the areas that will come to define tomorrow and London is at the forefront of innovation.”
“The UK tech community must now firmly set its sights on closing the gap between the global tech powerhouses of the US and China – ensuring that the capital, talent and infrastructure for growth is in place for the start-ups and scale-ups that are aiming to reach the next level.”