More than £10bn was invested in UK tech companies in 2019 according to the Tech Nation 2020 report, published today. The data reveals there are seven digital technology ‘unicorns’ based in the South East of England, and Oxford joins Manchester, London, Bristol and Cambridge as the five UK cities in the top 20 European investment tech cities.
The digital technology sector grew nearly six times faster than the UK economy as a whole, up 43 per cent in eight years. Over 80 per cent of tech sector investment in 2019 was in scale-ups.
Based on the amount of investment, the future of innovation lies in the use of Artificial Intelligence, Robotics, Cybersecurity, Blockchain, Internet of Things (IoT), Virtual Reality (VR) and Augmented Reality (AR). Emerging sectors seeing recent growth in investment include Agritech, Healthtech and Cleantech.
Tech Nation’s investment figures exclude debt, lending capital, grants, initial coin offerings and other non-equity funds. As Oxfordshire’s early stage companies benefit from a range of sources that include some of these, the total funding of the county’s entrepreneurial efforts may be under-represented.
Elizabeth Corse, Entrepreneur Engagement Manager, South East, Tech Nation, commented: “The South East is home to a wide range of important tech clusters that specialise in emerging technology. We have strong AI hubs in the Thames Valley and Southampton, a thriving gaming and IOT sector in Surrey, a vibrant creatives and AR/VR presence in Brighton and the Solent as well as dynamic digital health and life sciences sectors in Oxfordshire, which is also emerging as a cleantech hub.
She adds: “With the right conditions, including greater choice of early-stage financing (seed and Series investment), and by encouraging more diverse talent to join the sector, we will see another eleven companies come through the pipeline to reach unicorn status.”
Eileen Burbidge, Partner, Passion Capital and Chair of Tech Nation, commented: “The latest findings from Tech Nation today evidence the impact the tech sector has on the UK economy. The UK tech sector is growing 6 times faster that of the rest of the economy, and we are seeing UK tech companies raise funds from investors all over the world. Fintech continues to be one of the UK’s key strengths, with 44% of Europe’s fintech unicorns and high-value scaleups being located in the UK.”
Digital tech employs 2.9m people in the UK, an increase of 40% from 2017 (now accounting for 9% of the national workforce). Unsurprisingly, Tech Nation also reports recruitment challenges. It observes that since 2015 there has been a 150% increase in demand for roles within the digital technology sector. Vacancies for tech roles have been increasing continually since 2011.
View the full Tech Nation 2020 report here.