The UK is creating almost $1bn “unicorn” technology business a week after influx of £13.5bn venture capital (VC) funding in the first six months of the year, setting the tech sector up for another record year of innovation funding in 2021.
According to data compiled for the UK’s Digital Economy Council (DEC) and entrepreneurial network Tech Nation by data provider Dealroom.co, the UK is now home to 105 unicorns.
Out of these, 20 reached unicorn status in the first six months of 2021 alone, including Tractable, Zego and Depop. From these 20 companies, 11 are financial technology (fintech) firms, which as a subsector attracted £4.2bn of the total raised. After fintech, healthtech attracted the second highest amount (£2.7bn), followed by enterprise software (£1.3bn), and transportation (£1.1bn).
The number of potential future unicorns has also increased, from 132 companies in May 2021 to 153 in the latest figures.
The £13.5bn investment record can in part be attributed to a handful of “mega fundraising rounds” by UK tech companies, including £578m raised by challenger bank Revolut (the UK’s single biggest tech company), £289m by cyber security platform Snyk, and £1bn by car sales platform Cinch, among others.
More than half of all funding rounds raised in the previous year have also seen over £100mn worth of investment, with around 1,700 startups and scaleups in total receiving capital backing.
The record levels of investment and number of unicorns show that tech companies nationwide are driving the UK’s post-Covid economic recovery, as well as helping to consolidate its position as the world’s third largest global tech ecosystem, after the US and China. And it is not just about fintech – UK tech has proven it is capable of producing world-class tech companies in AI [artificial intelligence], biotech and cyber. .
During the pandemic, more than £1bn of convertible loans were issued to a total of nearly 1,200 startups through the government’s Future Fund programme, which was launched in April 2021 by finance minister Rishi Sunak to support startups and loss-making companies with the investment needed to stay afloat during the pandemic.
The British Business Bank revealed on 14 September 2021 that, as a result of the Future Fund loans, the government now has equity stakes in 158 high-growth startups.
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(Source – Computer Weekly)