London leads the way for international tech investment over past decade
London, 8th June 2023 – London continues to be one of the top global destinations for tech companies looking to expand internationally, with fresh data from London & Partners showing the UK capital has attracted more new international tech companies than any other global city in the past decade. Released to coincide with the upcoming 10th anniversary of London Tech Week (June 12-16th), the fresh data shows that since the event was founded in 2014, London has recorded more than 1,700 tech foreign direct investment projects – more than the likes of San Francisco and New York1.
Despite a challenging global economic climate, London’s attractiveness as a top destination for international tech firms looking to setup an overseas operation remained resilient, with the latest data available showing that the UK capital ranked second globally for tech foreign direct investment in 2022. Last year, London attracted 175 new tech companies, more than Singapore (130), Berlin (101) and Paris (100) – and second only to Dubai (223)1.
Some of the world’s biggest tech companies continue to make long term investments into London, with notable investments including: Google’s $1bn purchase of their Central Saint Giles office and the development of their new King’s Cross Office, Apple’s new UK headquarters in Battersea set to open this year and one of Salesforce’s largest office spaces outside of the US at the Salesforce Tower in Bishopsgate. Recently London has also seen international expansions from Indian AdTech giant InMobi, Chinese tech entertainment company, Tencent, and US fintech unicorn, Alloy.
London’s tech sector sees rapid growth over last 10 years
Since the launch of the first London Tech Week in 2014, London’s tech ecosystem has matured into one of the leading hubs for producing start-ups and scale-up companies. According to data from Dealroom, the value of London’s tech ecosystem has grown exponentially in the past 10 years from $70bn in 2014 to $621.5bn in 2023. The UK capital is by far the highest valued ecosystem in Europe, ahead of the likes of Paris ($247.6 bn) and Berlin ($153.6 bn)2.
The growth in value of London’s tech ecosystem has partly been fuelled by the UK capital’s ability to produce unicorn companies (tech companies valued over $1bn). To date, London has created 101 unicorn companies a significant increase than the 15 unicorns that were present in the city 10 years ago in 20142. This is more than any other city in Europe, including Paris (32) and Berlin (34). The most recent companies to join London’s unicorn club include: Quantexa, an AI company that recently raised a $129m series E funding round, EdTech company Multiverse and fintech company, Paddle.
The growth of London’s tech scene over the past 10 years is also demonstrated by the increasing amount of venture capital being put into London companies – a total of $107bn has been raised by London tech firms since the year London Tech Week was first founded. In fact, VC investment into London has increased by over 800% since then, with total funding reaching $22.4bn, compared to the $2.4bn in 20142. Leading global VC firms such as Index Ventures, Lighstpeed Venture Partners and Sequoia have recently established a significant presence or new funds in London.
London tech set for continued success based on strengths in high growth sectors
London’s tech sector is set for a bright future, with latest data showing that despite a global slowdown in VC investment, the UK capital continues to attract significant funding into technologies that are tipped for strong growth in the coming decade.
London has established itself as a world leader in fintech, with its fintech firms securing more investment last year than any other city. Funding into London fintech companies has grown rapidly in the past decade, increasing from $495m in 2014 to $9.9bn in 20222. In this time, London has created fintech unicorns such as Wise, Monzo and OakNorth Bank who have benefitted from the city’s leading position as a top global financial centre and access to tech talent.
With some of the world’s leading universities and life sciences research facilities, London’s health tech sector has also seen strong growth. VC funding into London’s health tech companies has grown from $113m in 2014 – to $1.5bn in 20222. London is home to over 165 VC funds specialising in life sciences and has produced exciting companies such as Accurx and Kherion Medical that are creating technologies to transform the healthcare sector.
As a city, London has set an ambitious target to become a net zero carbon city by 2030. This is encouraging lots of entrepreneurs to play their part and has resulted in the growth of a climate tech cluster in London including companies such as Octopus Energy, Newcleo, and Carbon Clean Solutions. Investment into climate tech companies in London has increased from $127m in 2014 to $1.9 billion in 20222.
This year marks the ten year anniversary of London Tech Week, since it was founded in 2014. London Tech Week has grown to become one of Europe’s largest festivals of technology and innovation. Over 20,000 attendees are expected to descend on London from 12th to 16th June, including delegations of international businesses from over 50 different countries.
The Mayor of London, Sadiq Khan, said: “Over the past decade, our tech sector has grown to become an international success story, creating jobs and economic growth for all Londoners. This is highlighted by these new figures showing London remains a top destination for the very best international tech businesses. The tenth anniversary of London Tech Week is a great opportunity to celebrate our recent successes and I look forward to another decade of growth for our city’s tech sector, resulting in a better, more prosperous London for all.”
Janet Coyle CBE, Managing Director for Grow London at London & Partners added: “Over the last ten years London’s tech sector has not only established itself as the biggest tech ecosystem in Europe but one of the leading tech hubs on the global stage. London has matured from a burgeoning start-up hub to a place where you can also scale an international tech business. Our strengths in the development of cutting-edge technologies such as fintech, Artificial Intelligence and climate tech demonstrate that we are well placed to see strong future growth. We are looking forward to welcoming large numbers of international companies, investors, policy makers and entrepreneurs to London for this year’s London Tech Week to explore all the amazing growth opportunities our city has to offer.”
Debbie Weinstein, Vice President and MD, Google UK & Ireland, said: “London is home to countless innovative businesses, a thriving creative industry and truly incredible tech talent. We’re proud to call this world leading city home and to be growing our UK presence here, with the $1bn purchase of our Central Saint Giles Office and the development of our King’s Cross Office. We’ll continue to invest in long-term partnerships in the capital to create new opportunities for Londoners in our local communities and beyond.”
Carlos Gonzalez-Cadenas, Partner, Index Ventures added: “London’s density and breadth of experienced talent, investors and founders building global businesses has turned it into one of the best places globally to start and grow a business. London’s next challenge is to maintain what has made it great for building startups — access to talent, friendly regulation, availability of capital and the vibrant, welcoming nature of the city — while also preparing the ground for the next phase of innovation and the emergence of increasingly larger, high-growth businesses.”
Zahra Bahrololoumi, CEO UKI at Salesforce, added: “We are deeply committed to the Capital’s tech ecosystem. Salesforce is the trusted digital advisor to organisations all over the world, but London remains core to our business because of the size and strength of its tech sector. Digital transformation remains firmly at the top of the CEO agenda. From deploying transformative technologies like generative AI, to using data to drive efficiencies and enhance customer experiences, exciting innovation is enabling UK businesses to grow and be productive. This appetite for technological transformation is why London, and the UK more broadly, is home to so many innovative, interesting and inspiring organisations.”
Rishi Khosla, CEO and co-founder of OakNorth added: “Almost eight years on from OakNorth’s launch, London remains one of the best locations globally to start a business, especially for fintech companies. With a 10% global market share, the UK’s fintech sector benefits from London’s outstanding tech ecosystem and access to global markets. This goes hand-in-hand with regulators and policymakers who are determined to keep London competitive on the world stage. I am honoured to be speaking at London Tech Week to share my insights as we celebrate everything the sector has achieved.”
Carolyn Dawson, CEO Founders Forum Group said: “Since the first London Tech Week in 2014, London’s tech sector has grown from strength-to-strength and is now a global success story. We’re really excited to be welcoming investors, entrepreneurs and policy makers from across the globe to celebrate the 10-year anniversary of London Tech Week. This year’s festival will be the biggest yet and will offer a great platform to showcase the very best of the UK’s tech ecosystem to the rest of the world.”
Russ Shaw CBE, Founder of Tech London Advocates & Global Tech Advocates added: “In the ten years since London Tech Week’s inception, the capital’s tech industry has grown by leaps and bounds, and today stands shoulder to shoulder with the leading tech hubs around the globe. London’s diversity has emerged as a cornerstone of its strength, with tech verticals from cyber, to fintech, to AI and green tech boasting remarkable levels of maturity and spearheading innovation. The cross-pollination of ideas and expertise between these verticals has resulted in an ecosystem that rivals the best in the world, and these latest figures are a testament to that. Making the most out of the UK’s strengths in tech, however, will only be possible through enhanced international collaboration. London Tech Week is an important opportunity to build stronger ties with tech delegations from all around the world, and to celebrate London’s and the UK’s global leadership role.”
Matt Penneycard, Co-founder and Partner at mission-driven VC firm Ada Ventures, said: “In spite of Brexit, the war in Ukraine, and the resignations of a few Prime Ministers, this impressive data backs up our own experience: London, and the UK in general remains the place to build a tech start-up outside of the US. From Shoreditch to Notting Hill, our diverse and dynamic city attracts extraordinary talent in climate-tech, fin-tech, healthcare and AI, and is home to start-ups finding solutions to some of the hardest problems the world faces.”
Libby Dangoor, Chief of Staff at Multiverse, said: “Multiverse has had its base in London since we began, and for good reason. It’s a hub of talent, diversity and innovation that draws top talent from all over the world. As a company committed to investing in talent, we take pride in our role in the development of diverse tech professionals through professional apprenticeships both in London, and across the UK.”
Janine Hirt, CEO of Innovate Finance added: “London has built a unique reputation as the best place to start and scale a FinTech business, and today stands ahead of its global peers as a leading tech and innovation hub. Investment levels into the city have been second to none. Combining that with a supportive regulatory environment, a culture of entrepreneurship and innovation, and a strong collaborative relationship with policymakers, London and the UK have managed to cultivate one of the world’s preeminent tech ecosystems. FinTech proudly sits right at the heart of that success story, and represents the jewel in the crown of London tech. The UK FinTech industry has positively changed the lives of consumers and businesses by making financial services more accessible, more inclusive and more democratic. We are pleased to be celebrating the 10-year anniversary of London Tech Week, and look forward to London’s continued success as the central hub for innovation in financial services.”
Notes to editors
Data sources
- Data sourced by London & Partners from fDi Markets Intelligence. Downloaded as of 01/06/2023.
- Data sourced by London & Partners from Dealroom.Co. Downloaded as of 31/05/2023.
Table showing the top 20 global cities for tech foreign direct investment projects from 2014-2023*
|
Destination City |
2022 |
Total tech FDI projects (2014-2023) |
|
London |
175 |
1,752 |
|
Singapore |
130 |
1,041 |
|
Paris |
100 |
816 |
|
Dubai |
223 |
742 |
|
NYC (NY) |
72 |
621 |
|
Berlin |
101 |
512 |
|
Bangalore |
99 |
489 |
|
Sydney |
45 |
460 |
|
Dublin |
43 |
427 |
|
Tokyo |
38 |
371 |
|
Amsterdam |
57 |
371 |
|
Barcelona |
67 |
349 |
|
Munich |
34 |
334 |
|
Toronto |
52 |
318 |
|
Hong Kong |
22 |
264 |
|
Hyderabad |
84 |
263 |
|
San Francisco (CA) |
23 |
261 |
|
Melbourne |
30 |
254 |
|
Madrid |
41 |
240 |
|
Pune |
64 |
209 |
Source: fDi Markets Intelligence, June 2023
*Based on data for Software & IT Services projects. 2023 data is based on Q1 2023 data (Jan-March)
About London & Partners
London & Partners is the business growth and destination agency for London. Our mission is to create economic growth that is resilient, sustainable, and inclusive. We are a not- for-profit company and operate as a social enterprise, half funded by the Greater London Authority (GLA) and half from other sources including our portfolio of commercial ventures. For more information, visit: www.londonandpartners.com
About London Tech Week
London Tech Week is the most influential tech event in the UK. It’s a huge celebration of tech as a force for good that connects the world’s most inspirational founders, corporate heavyweights, government leaders, investors, and the next generation of tech superstars. It is owned by Informatech Founders and London & Partners and partners with Tech London Advocates. London Tech Week is supported by the Mayor of London and HM Government and takes place from 12 – 16 June 2023. https://londontechweek.com/
