The UK tech industry has been given an $8 billion boost despite a record fall in exports to the EU after Brexit, with global investors placing faith in UK start-ups.
Research from Dealroom.com found London is at the centre of Europe’s growing tech industries despite reports from the Office for National Statistics (ONS) that the UK’s exports have tumbled over 40 per cent since January.
Brexit however hasn’t had any affect on venture capital (VC) investors’ confidence in the UK’s biggest start-ups, with London being home to some of the world’s fastest growing unicorns.
Fintech brands Starling Bank and Revolut are among those who’ve been given big votes of confidence, while health-tech companies such as mobile doctor app Babylon Health have also secured investments.
London’s health-tech firms have raised a total of $3.2 billion, more than any European city since 2016.
Venture capital investment in the UK looks set to smash last year’s $10.5 billion in just the first half period according to Dealroom.
Five companies have already reached a $1 billion valuation (or ‘unicorn status’) so far in 2021, almost as many as the whole of last year.
“The tech sector has not only survived; in many areas, it has boomed,” Tech Nation, a government backed entrepreneur network, chief executive Gerard Grech said.
“From ed-tech to health-tech, tech scale-ups are at the centre of rebuilding the British economy and setting new standards worldwide”.
This will come as a relief to UK businesses hoping for a trickle-down effect after GDP shrinks by the largest amount in nine months.
Food products have suffered the most as a result of the fall in exports, shrinking by 63.6 per cent in January.
However experts aren’t worried about lasting impacts, with the Prime Minister’s lead European advisor David Frost stating there was “less need to move goods in January” and that Covid lockdowns had “reduced the demand” for goods.
London Mayor, Sadiq Khan added: “London is the global tech capital of Europe. Despite the challenges brought about by Brexit and the coronavirus pandemic, London’s tech sector continued to thrive in 2020 and has an important role to play in the city’s economic recovery.”