VC funding in UK tech sector approaches $10bn since 2010
London’s booming Fintech sector continues to gasoline funding
The UK’s know-how sector is constant to draw document ranges of enterprise capital funding, with corporations elevating greater than $three.6 billion in 2015, in accordance with figures compiled by London & Companions, the Mayor of London’s promotional firm1.
The funding represents a rise of over 70 per cent on the report quantity raised in 2014 ($2.1 billion). London-based tech corporations raised a report $2.28 billion through the interval, representing a 69 per cent improve on the $1.three billion raised in 2014.
Evaluation of VC funding by London & Companions exhibits that since 2010 UK know-how corporations have collectively raised virtually $10 billion ($9.7bn) with London-based companies accounting for greater than half of the whole ($5.2 billion). Throughout 2015 the funding secured by London-based tech companies accounted for 63 per cent of complete VC funding raised by UK tech companies.
Mayor of London Boris Johnson MP stated: “The Mayor of London Boris Johnson MP stated: “With a flourishing tech scene and one of many world’s main monetary centres, it’s no shock to see that London’s tech corporations are attracting report ranges of funding. Our world-class expertise pool and our tradition of innovation and entrepreneurial spirit are serving to the sector to develop from power to power. We will anticipate the capital’s tech sector to proceed to generate jobs and progress for the town’s financial system for a few years to return.”
Eileen Burbidge, Companion at Ardour Capital and Mayor of London tech ambassador stated: “As we speak’s document funding figures supply additional proof that the UK’s tech sector continues to mature. Buyers are more and more attracted by the range of London’s tech ecosystem but in addition our strengths in sure sectors reminiscent of FinTech. With extra funding coming in from abroad and larger entry to London-based progress funds, there has arguably by no means been a larger time to start out and develop a digital enterprise in London.”
London’s booming monetary know-how (‘FinTech’) sector has additionally continued to safe document funding throughout 2015. The sector accounted for nearly 1 / 4 of all funding raised by London-based tech corporations. A few of the largest FinTech offers this yr embrace TransferWise ($58m) and WorldRemit ($100m).
In April 2015, London-based peer-to-peer lending firm, Funding Circle secured the most important single deal of the yr with a $150m funding spherical led by DST International. James Meekings, co-founder and UK Managing Director Funding Circle stated: “Small companies are the lifeblood of the financial system and we’re enthusiastic about serving to them to entry finance by connecting them immediately with buyers. The cash we raised, from a few of the world’s main buyers, permits us to proceed to extend the variety of small companies that may borrow via Funding Circle, each within the UK and the world over. We need to grow to be the primary selection for small enterprise lending.”
Final yr was additionally a robust one for the UK’s ecommerce sector, with quite a few corporations that includes within the prime ten offers together with: FarFetch ($86m), MADE.com ($60m) and Secret Escapes ($60m).
The web takeaway start-up Deliveroo had a profitable yr securing a complete of $195m in three separate funding rounds. William Shu, co-founder and CEO of Deliveroo, stated: “We’re proud to be a London-based firm. Not solely is the town nice for buyers and tech expertise, nevertheless it’s been a perfect launch pad for our international enterprise.”
Funding into London’s know-how sector has been boosted by a rising variety of enterprise capital homes selecting to setup funds and operations in London. In October 2015 Octopus Ventures introduced a $140m London based mostly fund, becoming a member of the likes of Ardour Capital, Index Ventures and Hoxton Ventures who have already got a presence in London and have chosen the capital as a strategic base to spend money on European know-how start-ups.
Separate analysis from London & Companions (see Appendix three) discovered robust backing for London tech corporations from native buyers with 50 per cent of all VC offers originating from buyers based mostly within the UK. Nevertheless, London tech corporations are additionally engaging US buyers, with virtually one third (29%) of all offers into London-based tech companies originating from US enterprise capital buyers.
Gordon Innes, CEO of London & Companions added: “With London companies receiving over 60 per cent of all of the funding into the UK’s tech sector, it’s clear that buyers consider that London provides a terrific return on funding. In addition to a few of Europe’s most enjoyable start-ups, the capital now homes companies of real scale. These corporations are flourishing as they’re able to profit from the town’s quick access to expertise and worldwide markets. This makes London one of many world’s most engaging tech hubs for entrepreneurs and buyers alike.”
In 2015, Index Ventures was probably the most lively investor into London tech corporations, collaborating in 12 offers value as much as $345.55. Index’s excessive profile investments in 2015 embrace Deliveroo, Secret Escapes and Onefinestay. The highest 5 funding homes in London tech corporations for 2015 additionally embrace: Accel Companions, Balderton Capital, 83North and Hoxton Ventures.