British tech start-ups beat France and Germany combined to win record investment

boris johnson

Investors put record sums into British digital start-ups last year, cementing the country’s position as Europe’s most vibrant hub for fast-growing technology-enabled businesses.

Despite Brexit uncertainties, digital companies raised a record £10.1 billion, up £3.1 billion on the 2018 total, according to research being published today.

The companies secured more new capital than their French and German counterparts combined and accounted for a third of the venture capital invested across Europe, a report by Tech Nation, a taxpayer-funded body that promotes the UK’s technology industries, said.

Britain is third behind the United States and China in venture capital funding, with some of the best-funded technology start-ups based in London. Companies in the capital are said to have raised £7.4 billion last year.

The report suggests that Britain will continue to create valuable technology companies even as its future relationship with the European Union remains unclear. The uncertainty over Brexit throttled business investment over recent years, but that failed to deter early stage technology investors. Venture capital funds raised their investment in UK-based digital firms by more than 40 per cent in each of the past three years, Tech Nation said.

The technology sector is considered to be less exposed to Britain leaving the EU with a bare-bones trading deal than other industries, which face disruptions from tariffs and border checks on physical goods. Pay levels were comparatively high in digital industries, so start-ups could find it easier to secure visas for skilled workers when freedom of movement ends, experts said. Almost half of last year’s investment came from American and Asian investors, easing fears that overseas venture funds would look elsewhere in Europe.

Baroness Morgan of Cotes, 47, the digital, culture, media and sport secretary, said: “Our tech companies are not only commanding the confidence of global investors, but they are also creating new jobs and wealth.”

Last year eight UK digital companies passed the $1 billion valuation mark, including Rapyd and, the payments firms, CMR Surgical, a medical robotics designer, and Babylon Health, a diagnostic app developer.

Britain’s other new so-called unicorns are Trainline, the booking app, Acuris, a financial data provider, Sumup, a point-of-sale technology maker, and Ovo Energy, the utility provider. Over two decades the UK has created 77 billion-dollar businesses, double the total number in Germany.

Five British companies raised more than $250 million each last year, with three taking more than $500 million in a single funding round. In May,, a middleman between merchants and the likes of Paypal and Apple Pay, received $230 million in funds. Greensill, which provides supply chain finance, raised more than $1.4 billion in two separate rounds last year, according to Tech Nation.

Financial technology companies raised a total of £4.1 billion last year, double the 2018 figure. Oaknorth, the upstart business lender, and Monzo and Starling, the digital banks, raised significant sums.

Guillaume Pousaz, 38, founder and chief executive of, said: “The UK’s fintech sector is one of the most competitive in the world thanks to the extraordinary quality of engineering talent.”

While private funding remained plentiful, public markets atrophied last year. The number of listings fell by 56 per cent to the lowest level in a decade, according to a report by EY.

There were 35 flotations on the London exchange last year, 24 on the main market and 11 on Aim, the junior market, and companies sold £5.9 billion of shares. In 2018, 79 companies went public, raising £9.5 billion in fresh capital, EY’s report said.