In the first seven months of 2019, UK-based technology companies have attracted investment of £5.5 bn ($6.7 bn) – more than in the whole of 2018.
Much of the money has come from investors in Asia and the US, which have pumped a total of £3.1 bn into UK tech firms. At the current rate, the target is set to beat 2017’s total investment record of $9.4 bn, according to data from Tech Nation, a network of tech entrepreneurs, and Dealroom, the group that tracks innovative tech companies.
Eileen Burbidge, chair of Tech Nation, says in a statement: ‘Investment in the UK tech sector has been steadily rising for years and, as these latest figures demonstrate, the momentum is increasing. It is incredibly gratifying to see that in addition to domestic and European investors, British tech innovators are also attracting US and Asian investor attention and allocation.’
‘Foreign investment into both the US and Chinese tech sectors has gone down because of the trade war and because Europe has provided several attractive investment opportunities lately,’ adds Yoram Wijngaarde, founder and CEO of Dealroom.
But Frances Doherty, a partner at law firm Dorsey & Whitney and a tech industry lawyer in London, offers a more balanced perspective on the numbers: ‘The plummeting value of sterling has had some upsides. Despite the continuing uncertainty and drama around Brexit, UK tech is booming: UK tech companies have secured £5.5 bn in foreign investment since the beginning of 2019 and, for the first time, investment in UK tech companies has overtaken the US on a per capita basis.
‘This increase is, however, somewhat powered by the weak pound and must be seen against another announcement by the UK government this week: that free movement will end on November 1 in the event the UK leaves the EU without a deal on October 31. The thriving tech industry in the UK is powered by international talent and, already, companies are finding it hard to recruit the people they need.’
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