UK tech on the global stage – Tech Nation Report 2019

UK tech on the global stage – Tech Nation Report 2019
Source: https://technation.io/news/uk-fourth-in-the-world-in-fast-growth-investment-after-us-china-and-india/

The Tech Nation Report has been the UK’s state of the nation on tech since 2015. Each year the report provides a comprehensive look into the evolution of the UK’s tech ecosystem, exploring the drivers that underpin and power economic growth within the sector.

The UK has long been understood to be a critical hub in the global tech ecosystem and a strong economic performer, and so for the first time this year, the report explores the UK in the wider international landscape. Looking at international and national tech investment, areas of potential growth and related specialisms, talent hubs and more, we sought to monitor and understand the progress of an innovative tech player operating on the global stage.

Read the full Tech Nation Report 2019 >

Key stats

  • 4th – The UK is fourth in the world for scaleup investment after US, China and India
  • 2.5x – Scaleup tech investment 2.5x higher than expected based on the relative size of the UK economy
  • £6.3bn – Total 2018 venture capital investment in UK tech topped £6bn, more than any other European country
  • 5% – The UK remains hotbed for tech talent, employing 5% of all high-growth tech workers globally, placing the UK ahead of Japan, France and India
  • 35% – To date, 35% of Europe and Israel’s tech unicorns ($1bn valued businesses) have been created in the UK
  • 1st – The UK leads the rest of the world in fintech – investment in high-growth fintech firms achieves £4.5bn between 2015 and 2018

Read the full Tech Nation Report 2019 >

UK Prime Minister, Rt Hon Theresa May MP, commented: ‘‘The UK is a global tech powerhouse. I am immensely proud of our country’s ambitious tech scaleups. These companies are delivering significant economic value to the nation through the investment they raise, the jobs they create and the innovative products and services they deliver’’.

Adventurous capital

The UK tech sector performed particularly well in investment last year. In 2018, the UK managed to attract 5% of global high-tech scaleup investment, placing it fourth in the world – ahead of Germany, France and Sweden.  

Total deals £000,000 (2015-2018)

Investment for UK high-growth digital tech firms also grew 61% between 2017 and 2018 – driven in large part by ambitious UK tech scaleups (tech scaleups delivered the majority of all tech investments in the UK in 2018 – £5bn of £6.3bn).

The UK’s strongest tech sub-sector, and where it currently ranks as number one in the world, is fintech, with investment in UK high-growth fintech firms achieving £4.5bn between 2015 and 2018.

London continues to remain the UK’s leader in attracting high-growth tech investment, receiving £9bn from 2015 to 2018. Cambridge is second, at £583m, with other UK cities continuing to make considerable ground.

UK Chancellor of the Exchequer, Rt Hon Philip Hammond MP, commented: “The UK tech sector continues to grow strongly with UK firms attracting the most venture capital funding in Europe and investment in  digital scaleups growing by almost two-thirds in a year. We are supporting British innovation so we can drive growth, jobs and higher living standards, including through £2.5 billion for the British Business Bank. This funding will help high-growth firms to access the finance they need to succeed.”

Looking beyond high-growth tech companies, the last 12 years have seen a much greater distribution of investment across the UK.  Notably, the East of England has seen the greatest increase in capital invested across all tech companies, at 206%, followed by the West Midlands (54%) and Yorkshire and the Humber (51%). On an international scale, UK cities continue to attract investment on the global stage. 

Hidden talent

In 2018 the UK continued to remain a hotbed for tech talent, employing 5% of all high-growth tech workers globally. This places the UK ahead of Japan, France and Indonesia.

In the UK, Insurtech and Fintech were the biggest employers among high-growth digital tech firms in 2018, employing 24% and 18% of the high-growth workforce respectively.

Eileen Burbidge, Partner, Passion Capital & Chair of Tech Nation commented: “The UK has an incredibly pivotal role in the global tech scene. Nowhere is this more evident than in the Fintech sector where the UK is ranked number one in the world; an enviable position that has been established with decades of hard work, entrepreneurial talent, innovation and supportive policymakers. I’m confident that we have all the ingredients needed for continued success and even greater acceleration of the tech sector here in the UK.”

Cyber, AI, and Cleantech all feature in the top ten sectors for employment in high-growth tech firms. Investment data shows that AI, Cyber and Big Data are growing in importance for UK tech scaleups. This means that the UK may be about to see more jobs generated in these sectors.

UK Secretary of State for Digital, Culture, Media and Sport, Rt Hon Jeremy Wright MP, commented: “This report confirms the UK is one of the world’s leading digital economies, with some of the best minds globally working here and strong investment in the tech sector right across the country. We are working hard to continue this success and remain committed to making Britain the best place to start and grow a digital business.”

London’s scaling

From December 2018 to February 2019, high-growth firms in London grew by over 56%, more than anywhere else in the world.

Gerard Grech, CEO, Tech Nation commented: “The UK continues to exceed all predictions when it comes to tech growth. This report shows how the UK is a critical hub when it comes to global technology developments, with scale-up tech investment being the highest in Europe, and only surpassed by the US, China and India. This is a testament to the innovation, ambition and tenacity of tech entrepreneurs across the UK. These valuable findings will help inform how the UK as a nation can continue to foster competition and collaboration in an increasingly interconnected world.”

Tugce Bulut, CEO & founder, Streetbees commented: “As a scaling company that embodies many of the trends within this report, I’m delighted that our research in it illustrates the UK tech sector’s diverse strengths – from the supportive ecosystem and culture, to the deep expertise in AI, fintech, e-commerce, and elsewhere – so categorically. The UK is an incredible place not only for founding a start-up, but also for growing it into a company capable of taking on the world.”

Investing in innovation

Research and Development (R&D) expenditure in the UK in 2016 represented 1.67% of gross domestic product (GDP).

Businesses and government have put significant financial resources towards the development of a knowledge-based economy. Based on the most recent data from 2016, the UK was ranked 7th globally for R&D expenditure, with spending up £1.4bn to £33.1bn, an increase of 4.3%. This is above the long-term annual average increase of 4.1% since 1990.

Hayden Wood, CEO & Co-founder, Bulb commented: “The UK is a great place to build a technology company. We wouldn’t have been able to use tech to reinvent energy without the access we get in the UK to talent, investment and community. We’re also proud to be part of a growing number of companies developing tech for good. We’re excited to see how investment at this scale can accelerate the growth of these companies.”

Read the full Tech Nation Report 2019 >

We would like to thank The Department for Digital, Culture, Media and Sport, World Economic Forum and The Department for International Trade.

In creating this report, the Tech Nation Insights team used data from Companies House, Dealroom, GitHub, Meetup.com, the OECD, Pitchbook, Stack Overflow, Streetbees, Google Trends and World Economic Forum.

The post UK tech on the global stage – Tech Nation Report 2019 appeared first on Tech Nation.

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p align=”left”>Source: https://technation.io/news/uk-fourth-in-the-world-in-fast-growth-investment-after-us-china-and-india/

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