UK investment in tech drops

UK investment into technology dropped 22% in 2022, following a trend across Europe and amidst mass layoffs around the world. 

An annual ‘State of European Tech’ report found that UK investment into tech ventures faced one of the steepest drops in Europe despite record funding last year. 

Despite the drop in investment, the UK remains one of the biggest investors in Europe, as alongside France, the two countries represent over 50% of the venture capital funds raised according to venture capital firm Atomico’s report. 

Simon Bumfrey, European Head of Relationship Banking at Silicon Valley Bank UK, said in the report: ‘The current environment, though challenging, is a necessary part of the innovation cycle. Recent experiences don’t change our view of the market or opportunity. For us, it’s just a question of when, not if our markets will recover.’

London also remained the city with the most capital invested as, despite the amount invested decreasing on 2021, 2022 saw $19.234m invested in London from 895 different deals. 

However the UK remains home to the most ‘unicorn’ companies, one that has reached a valuation of $1bn, of any region in Europe with 110 companies reaching the standard. 

Although, the country’s share of ‘unicorns’ in comparison to Europe has dropped from 41% to 26% as other countries see a push of investment and successful businesses. 

Croatia and Iceland saw the biggest increase in tech investment on 2021 as the Eastern European nation found a 439% increase in investment whilst the island country saw a 359% difference compared to last year. 

Overall, tech companies have seen the investment bubble burst as European companies saw a decrease in value of about $400bn. Subsequently the ‘European tech ecosystem’ went from a valuation of $3.1tn to $2.7tn despite a healthy first quarter. 

In March of this year the UK tech industry on its own was valued at $1tn in analysis done by data platform Dealroom. 

The future of the UK tech industry was part of a recent speech made by Prime Minister Rishi Sunak who focussed on artificial intelligence and announced a plan to bring in 100 of the world’s best AI talent to the country.

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