According to a latest research released, investments in the United Kingdom’s tech sector grew with a faster pace than in China and the United States last year. The report prepared for the government by research firm Dealroom and industry group Tech Nation said that the venture capital funding for U.K start-ups grew forty-four percent to a record about $13.2 billion in 2019.
Dealroom Statistics About the U.K.
In contrast, the figures of Dealroom show that the investment in the Chinese and United States tech companies decelerated from January 2019 to December 2019, with the United States seeing a twenty percent decline and China a sharper fall of sixty-five percent. China and the United States still came out on top in terms of over agreement value, however, attracting 116 billion dollars and 33.5 billion dollars respectively.
What to expect?
💷 Investment in UK startups reached a record high of $13.2B in 2019
✔️ The UK outpaced the USA, China, Germany and France with 44% growth versus 2018
🦄 The UK also continues to lead Europe by number of new unicorns, with 8 new unicorns created in 2019 (2/2)
— Dealroom.co (@dealroomco) January 15, 2020
The statistics revealed that approximately half of the entire amount invested in United Kingdom technology came from the investors of the United States and Asia. Past year, foreign investors gathered in the United Kingdom and Europe in search of economy valuations after growing interest in growing areas like fintech. Start-ups such as online payment firm Klarna and challenger bank Monzo attracted massive nine-figure contracts led by the investors of the U.S.
However, fintech was not the only area observing significant growth. Evolving industries like Artificial Intelligence (AI), clean energy and so-called deep technology also receive huge inflows. Benevolent AI, the health company, raised about $90 million and Melody, a virtual reality (VR) firm raised $60 million, whereas in energy sector Ovo raised around $260 million from investors. Co-founder of LocalGlobe, Saul Klein said that Europe and the U.K. have during the last twenty years majorly seen on the sidelines of the worldwide tech economy.
The reason behind the Growth of the United Kingdom’s technology
According to Dealroom data, U.K accounted for a 3rd of around $40 billion investment into European tech firms last year. But it doesn’t mean that the countries all over the continent have not also experienced remarkable growth. While investment in the start-ups of Germany raised 41% to about $7 billion in 2019, whereas investment in French tech grew 37% to around $5.2 billion.
Still, the overall deal amount for Britain far outstripped that of its rivals at continent level with $13.2 billion invested in the tech start-ups of the country. Digital Minister for the United Kingdom, Matt Warman tells CNBC that the most striking thing about investing in the U.K. is the package. Warman said that the United Kingdom had a favourable business environment, language and geography along with some of the top schools of the world to thank for the growth of its technology sector.
Moreover, it’s also worth observing that the wealthy interest in U.K tech companies came against a backdrop of the United States and China trade gap that pulled in the technology industry. The officials of the United Kingdom set to finalize later this month on whether to allow the access of Huawei to its 5G networks, a critical decision that concerned by United States lobbying efforts to block and restrict the Chinese tech giant from international tech market.