UK tech sector beats US and China to lead global growth

AI and green energy business boosted by record foreign investment

A general view of the skyscrapers of the City of London, Friday, Jan. 10, 2020.(AP Photo/Alberto Pezzali)

Investment in UK technology businesses hit record levels in 2019 as the country beat the United States and China to top worldwide growth charts.

Investment levels in 2019 soared to £10.1 billion (Dh 48.2 billion) as the UK secured a third of all technology investment in Europe, according to the latest industry figures compiled by Tech Nation and

The UK’s Digital Secretary Nicky Morgan said: “These brilliant new numbers demonstrate the strength of the UK tech industry and how it is a sweet spot of our economy.”

British tech companies, she said, were “commanding the confidence of global investors,” creating wealth across the country.

UK-based tech firms secured more investment than Germany (£5.4 billion) and France (£3.4 billion) combined thanks to venture capital from Asia and the US, which accounted for nearly half of the sector’s funding in 2019.

Natalie Black, the UK’s trade commissioner for the Asia Pacific region, said: “Asian investors are taking a keen interest in the success of the UK’s tech sector.”

Gerard Grech, chief executive of Tech Nation, said UK tech businesses were “well poised to forge new international partnerships and global ventures, enhancing tech growth across borders”.

Digital minister Matt Warman hailed the country’s “business friendly environment” and “longstanding reputation for innovation”.

Success in attracting venture capital also fuelled a surge in the UK’s best performing sectors, including fintech, artificial intelligence and clean energy.

UK fintech firms raised £4.1 billion last year, seven-and-a-half times the amount raised by fintech companies in France. The figure also represents a 100 per cent increase over 2018.

In AI and associated technologies, investment grew by almost half a billion pounds, and in the clean energy sector, investment grew by 45 per cent on the previous year.

The new industry figures also showed that since 2014, the UK has produced more than double the number of so-called “unicorn” companies – startups worth more than $1 billion – than any other country in Europe.

Last year saw eight British companies reach unicorn status, bringing the total number of billion-dollar businesses created in the UK to 77, almost four times as many as the total number in Israel.

Investors, Ms Black said, are “enthused” by Britain’s record of building unicorn companies and by leadership in the fields of AI and clean energy.

While London remains the leading city for building billion-dollar startups in the UK, five other British cities now rank among the top 26 in the world for raising venture capital.

London Mayor Sadiq Khan called the city “the undisputed tech capital of Europe” and said the record investment levels reflected the city’s “diversity and entrepreneurial spirit”.