American investors are putting more money into London-based technology companies than ever before, according to new figures announced today by the Mayor of London. He revealed the figures during a trade mission to the United States aimed at strengthening economic and cultural ties between London and the US.
New figures compiled by London & Partners, the Mayor’s promotional company for the capital, show that London-based tech firms attracted $795.2m from US investors in 2014, more than doubling the previous record figure from 2012 of $296m. Investment from the US into the UK as a whole also set a new record of $1.35 billion, compared to the previous record of $582m received in 2012.¹
In total, London firms attracted $1.35 billion in venture capital funding in 2014, meaning that US funds were responsible for over half of all new funding received by the city’s tech sector. The figures were revealed at an event in New York hosted by London & Partners, in association with Tech City UK and the Technology is GREAT campaign.
The Mayor of London, Boris Johnson, said: “As the digital capital of Europe, London is clearly the place to create fast-growing tech companies, and our flourishing tech sector has caught the eye of US investors. London’s talent is attracting global investment, enabling our innovators to turn their ideas into companies that create jobs and economic growth in London.”
Gordon Innes, Chief Executive of London & Partners said: "London and New York are world-leading tech hubs where innovative companies are producing technologies that are changing the face of industry. For international companies expanding and investing overseas, London is their first choice. Over the last decade the city has attracted more HQ investments than Paris, Berlin and Dublin combined, with companies investing more than £4 billion and creating more than 20,000 jobs in the city."
Fred Destin, Partner at the venture capital firm Accel Partners, added: “London is undoubtedly one of the world's great tech hubs. Since Accel opened in London in 2000, we have seen the local ecosystem flourish and go from strength to strength. Today, we are seeing and investing in world-class British start-ups across a wide range of sectors, from consumer marketplaces and financial services to software-as-a-service (SaaS). London entrepreneurs are building technology leaders of global significance.”
The Mayor is on a six-day visit to the US East Coast aimed at strengthening ties between London and the US. Twenty-two of London’s leading financial technology firms are currently in New York on a trade mission organised as part of the Mayor’s Export Programme. They used today’s event to pitch to the investors in the hope of winning new deals for London.
London-based tech firms TransferWise and Shazam have already attracted major investments in 2015. The music tech company Shazam announced investment of around $30m valuing the company at over $1bn, while the fintech company while TransferWise recently announced $58m of new investment from Silicon Valley investment firm Andreessen Horowitz.
TransferWise also announced today in New York that it is to open offices in New York and Tampa, Florida. “London has been a great place to start and grow our business,” said Taavet Hinrikus, co-founder of TransferWise. “The city’s status as both a tech and financial hub means we've been able to grow the company from just my co-founder and I to a company of 250 employees, processing over £3bn worth of customers' money in four years."
London-based Digital Shadows, which provides a cyber-threat intelligence service, also revealed $8m of new venture capital funding at the event, led by US West Coast firm Storm Ventures. Alastair Paterson, CEO of Digital Shadows, said: “We will use this investment as a springboard to scale up Digital Shadows in order to reach new markets. We have been able to grow from a London-based start-up into a company that is now taking on global challenges in cybersecurity. London clearly has the infrastructure in place to allow other companies to follow in our footsteps and expand into global markets.”
Speaking at the event, Baroness Joanna Shields, Digital Economy Adviser to the British Prime Minister and Chair of Tech City UK, said: “There’s nowhere better in the world than the UK for technology companies to expand internationally. Companies like Box have already benefitted from our substantial capital, cutting-edge infrastructure and world-class workforce. Our digital economy has all the right conditions to help fast-growing technology companies thrive on a global scale. For those that are ready to expand their footprint, now is the time to make the move.”
Barclays also used the event to launch its fintech accelerator program in New York. The Barclays Accelerator, powered by Techstars, will open in July 2015. Derek White, Chief Design and digital Officer at Barclays and London technology ambassador commented: “Our goal in New York is to help innovators develop new disruptive fintech technologies, particularly in investment banking, wealth management and credit cards. We’re thrilled that we are able to extend our program to New York, a hub for global finance, building upon the successes we have already seen in London.”
At the event the Mayor of London demonstrated exciting new technology developed by the London-based start-up SAM Labs. Racing models of London and NYC’s world-famous cabs towards an iconic Tower Bridge finish line, the two will help London-based firm SAM Labs demonstrate the innovative products they are pitching to the US market.
SAM building blocks wirelessly connect to your computer to build Internet of Things devices, allowing people with no understanding of coding to construct moving machines. Using small wireless computer components such as switches, fans and motors, SAM teaches people young and old how build innovative electronic systems using a simple computer programme.
Notes to Editors
Images from the FinTech event in NYC and a video showcasing London tech can be downloaded from 1600 GMT/1100 EST on February 11 at http://bit.ly/1KGiHiL
¹ Based on data from CB Insights. London-based Tech investment FY2014 and US investment in London and UK over the same period.
Speakers at the NYC event include:
- Arianna Huffington, Chair, President and Editor-in-Chief of the Huffington Post Media Group
- Omar Tayeb, CTO and founder of London-based augmented reality firm Blippar. Since launching in the UK, the company has expanded quickly (from 40 staff in January 2014 to 200 today) and has a New York office with 40 employees as well as other offices in San Francisco, Los Angeles and Chicago
- Fred Destin, Partner, Accel Partners. Mr Destin is a well-known tech VC who recently moved back to London from Boston.
Other announcements to be made at the event include:
- London-based marketing engagement company EngageSciences will announce it has won new clients, including US media company Scripps Networks Interactive. The company’s success in attracting US clients and growth over the last year has enabled it to open a second office in Silicon Beach, California, in addition to its office in New York
- London tech community Chinwag is launching Pitch NYC (http://pitch-nyc.com), a twice-yearly pitch event in New York to introduce the leading fast-growth UK startups to NYC investors.
The data above includes a correction on previously released figures owing to a change in metholodogy.
About London & Partners
London & Partners is the official promotional company for London. We promote London and attract businesses, events, congresses, students and visitors to the capital. Our aims are to build London’s international reputation and to attract investment and visitor spend, which create jobs and growth.
London & Partners is a not-for-profit public private partnership, funded by the Mayor of London and our network of commercial partners.
For more information visit www.londonandpartners.com
Greater London Authority (GLA)
The Mayor of London Boris Johnson is leading a trade mission to America's East Coast aimed at strengthening economic and cultural ties between London and the United States.
During the six day visit the Mayor will meet with senior public officials and top business leaders in Boston, New York City and Washington, in a bid to ensure that London remains a key destination for US investment and American tourists and students. The Mayor wants to build on the warm relations that already exist with the States and to consolidate healthy collaborations between London and these three major cities.
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