London has once again emerged as the top city for tech investment in Europe.
Drawing nearly £1.8 billion in 2018, it leads its closest competitor, Berlin, by a considerable margin.
London Leads in Tech Investment
London has once again solidified its position as the leading European city for tech investment, drawing nearly £1.8 billion in 2018 according to data compiled by PitchBook for London & Partners. This figure nearly doubles the investment attracted by its nearest rival, Berlin, and constitutes almost three-quarters of the total funding for UK technology enterprises, which stood at £2.5 billion.
Despite this impressive feat, the total investment for London fell short of the 2017 record of £2.45 billion. Similarly, the total investment across the UK also experienced a decline from the previous year’s total of £2.99 billion. Nevertheless, the UK remains a formidable force in the European tech landscape.
Competitors in the European Market
Berlin followed closely behind London with a considerable £937 million in tech investment for 2018. This amount was almost double that of the previous year, reflecting a significant growth in the city’s tech sector.
Paris also saw a substantial increase in investment, reaching £797 million. However, the overall venture capital funding in the European tech industry experienced a slight decline, with a total of £10.44 billion raised compared to £10.47 billion in 2017.
Industry Expert Insights
Alliot Cole, CEO of Octopus Ventures, praised London’s performance, highlighting the strong international confidence in the city’s investment ecosystem. According to Cole, the data underscores the UK’s maturing position as Europe’s top locale for scaling businesses with global potential.
Cole emphasised the importance of continuing to support homegrown businesses with adequate funding, talent, and infrastructure.
He said, “When looking at the future of money, the future of industry and the future of healthcare, the opportunity for the creation of extraordinary businesses has never been stronger.”
Sector-Specific Growth
The UK’s fintech sector attracted a significant portion of the investment, amounting to £1.2 billion. This growth is partly due to the rapid rise of digital banks such as Revolut and Monzo.
Additionally, investment in artificial intelligence surged by 47%, totalling £736 million. These advancements underscore the UK’s leading role in these cutting-edge industries.
International Interest
Eileen Burbidge, a partner at Passion Capital, noted that London’s status as a global financial centre is a critical factor in attracting investment.
She stated, “We get a lot of calls and inquiries from investors in the US and Asia looking for fintech opportunities.”
Burbidge also highlighted that in sectors like fintech, AI, life sciences, and robotics, London is a globally recognised leader.
Challenges Ahead
Despite London’s impressive performance, the decline in total investment raises concerns about potential challenges ahead. The drop from the 2017 record suggests that maintaining momentum is crucial for future growth.
Ensuring a continuous flow of investment and innovation will be vital to sustaining London’s position at the forefront of the European tech industry.
Conclusion
London has reaffirmed its status as the premier destination for tech investment in Europe, outpacing rivals such as Berlin and Paris. However, the slight dip in overall investment highlights the need for sustained efforts to bolster the city’s tech ecosystem.
London has reaffirmed its status as the premier destination for tech investment in Europe, outpacing rivals such as Berlin and Paris.
However, the slight dip in overall investment highlights the need for sustained efforts to bolster the city’s tech ecosystem.