London Tech on Track for Record Year of VC Investment

This is London Tech Week and the city is doing a bit of well-deserved chest pounding touting its innovation cred.

In data compiled by London & Partners, the Mayor of London’s inward investment agency, venture capital investment into London is booming. In fact even while Brexit jitters rattle the world, 2019 is on track to be a record year for VC investment into London based tech firms. During the first 6 months of 2019, London tech firms received £2.56 billion in VC funding a record when compared to all previous years.

Mayor of London Sadiq Khan issued a statement on London’s support of tech:

“London is Europe’s leading tech hub and is helping to create even more jobs and investment for the capital and the wider UK economy. As our city’s tech ecosystem continues to grow it’s important that we encourage greater inclusivity and diversity across the tech sector and ensure that London stays open to investment and talent from around the world.”

In a speech delivered at the opening of London Tech Week, Prime Minister Theresa May said she was incredibly proud that the UK is at the heart of the tech revolution:

“Already we are one of the best places in the world to start and grow a tech business. British Tech is growing over one and a half times faster than the rest of the economy, adding more than one hundred and thirty billion pounds to our economy every year,” stated May. “We have a first-rate financial sector eager to invest, and last year tech venture investment was the highest in Europe. Our regulatory environment is second to none.”

According to a release, London is a leading global hub for technology and innovation, attracting more foreign direct investment (FDI)  from overseas tech companies than any other city in the last 12 months.

In the past year, 91 international tech firms chose to expand or set up an operation in the UK capital with total investments worth £864 million – more than the number of new tech investment projects in other global cities like Singapore (79), Paris (46) and New York (32).

The Mayor’s office states that in total, global tech investment projects in the last ten years were worth over £9.5 billion to London’s economy creating over 27,600 jobs.

Of course, Fintech, a subsector of tech, plays a very important role in London’s tech innovation sector. London is home to multipe Fintech unicorns.

London Fintechs have blossomed with recent major funding rounds in fast emerging firms like:

  • GoCardless – £57.91 million
  • Starling Bank – £75 million
  • Onfido – £50 million.

London is also home to big name Fintechs like Transferwise, Funding Circle, Revolut and more.

US Fintech Credit Karma joined in the laudatory chorus. Credit Karma picked the UK for its first expansion outside of its domestic market. Nichole Mustard, co-founder of the firm,  said they selected London for a number of reasons beyond the fact it is the well established financial center of Europe:

“… the regulator’s early adoption of EU “open banking” rules has been a boost for the industry and will allow for fintechs to innovate more quickly,” said Mustard. “By setting up our U.K. headquarters in London, we will be able to access more global customers and clients, as well as some of the best international tech talent.”

London is the top global destination for American tech companies looking to expand outside the United States. Just about all big tech has a presence in London with many slated to expand their footprint.


Table showing global foreign direct investment (by number of projects) for technology for the last 10 years (April 2019 to March 2019)

City 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 Total
London 43 62 93 111 95 90 115 96 120 91 916
Singapore 54 79 76 75 92 100 74 61 79 79 769
Sydney 22 34 44 67 49 50 45 39 35 26 411
Paris 15 22 36 30 40 47 42 41 91 46 410
Dubai 36 23 39 36 43 34 42 40 49 42 384
Bangalore 27 34 31 29 32 37 44 45 45 43 367
Hong Kong 40 32 35 28 28 26 36 25 28 12 290
Dublin 19 25 28 24 37 26 30 29 36 27 281
Tokyo 20 23 19 24 33 28 32 24 30 31 264
Shanghai 21 42 34 26 32 25 26 19 18 19 262
NYC (NY) 8 18 18 26 43 32 23 22 21 32 243
Munich 9 21 18 15 18 27 37 34 32 24 235
Amsterdam 10 13 16 28 26 20 35 32 25 26 231
Melbourne 13 21 29 23 21 30 22 23 10 26 218
Frankfurt am Mai 14 13 25 12 28 24 19 23 29 31 218
Sao Paulo 13 19 38 26 37 16 19 8 18 11 205
Toronto 9 14 12 20 18 18 20 19 20 33 183
San Francisco 8 9 15 20 45 24 14 21 13 9 178
Beijing 22 33 21 13 18 17 11 13 17 8 173
Berlin 10 7 10 11 17 10 35 23 14 11 148
Cities 21 to 2509 1,123 1,218 1,197 1,134 1,403 1,237 1,195 1,253 1,436 1,322 12,519
Not Specified 428 571 525 419 540 332 392 345 340 371 4,263
Total 1,964 2,333 2,359 2,197 2,695 2,250 2,308 2,235 2,506 2,320 23,167

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