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Big data, Robotics and AI fuelling VC investment in London

Cutting-edge technologies such as Artificial Intelligence (AI), Robotics and Big Data are among the fastest growing areas for investment according to analysis of venture capital flows into London’s tech sector carried out by the founders of London Tech Week.

London Tech Week 2015

The findings reveal that London’s AI & Machine Learning companies have become particularly attractive for investors, with 20 times more investment in 2016 (£85.75 million) than the amount raised in 2011 (£3 million). Over the past five years, London’s AI & Machine Learning companies have attracted over £207 million in venture capital investment, boosted by deals for London based companies such as Google’s DeepMind and Magic Pony1.

There has also been a sharp increase in VC pouring into London companies developing robotics and drone technologies, with over £14 million invested in 2016 compared with the small amounts invested in 2014 (£40,000) and 2015 (£70,000). Starship Technologies, the company behind the takeaway delivery robots used by Just Eat and Domino’s, received £13.95 million seed funding in January 20172.

London’s position as a leading global hub for financial services and technology has seen fintech companies receive over £2 billion of VC investment in the last five years – greater than any other sector including SaaS, Mobile and e-commerce1. London fintech companies saw strong investment in the first quarter of 2017 with over £177 million of funding since the beginning of the year – more than any other quarter in 2016. Major deals for Funding Circle (£82 million), Monzo (£22 million) and Currency Cloud (£20.27 million) offer further proof that investors still see London as a leading hub for fintech. This follows a report released last week by Deloitte which ranked London as the leading global fintech hub following the EU referendum.

Investors continue to view London as one of the world’s fastest growing and most attractive tech hubs – despite the UK’s vote to leave the EU. In Q1 of this year, London tech firms received £395 million in venture capital investment – significantly more than total amount raised in Q4 of 2016 (£245 million)3. In total, London tech companies have received over £1 billion in funding since the EU referendum - representing over 70 per cent of the total £1.59 billion invested into UK tech firms since Brexit.

Deputy Mayor for Business, Rajesh Agrawal said: “London is the technology capital of Europe. With a rich melting pot of creative talent, London is leading the way in the development of emerging technologies such as mobile payments, big data and artificial intelligence. Our world-class tech sector is creating jobs and growth across the city, with Londoners working alongside the best and brightest from across Europe and all over the world.”

“Since the referendum, London’s tech companies have attracted over £1 billion in venture capital investment, offering more proof that London remains open to investment, talent and innovation from all over the world.”

Russ Shaw, London Tech Week ambassador and Founder of Tech London Advocates and added: “Over the course of the last decade London has become a global hub for the technology sector. More recently, our expertise in Fintech, Artificial Intelligence and Robotics has shown that the city is at the cutting edge of technological innovation.

“London’s strength derives from the city’s diversity, rich pool of talent and global connections. This has been the basis for our considerable success, and it is important to protect these factors as our tech sector continues to create more jobs and wealth.”

Other sectors seeing high levels of venture capital funding in the past five years include e-commerce and AdTech with major deals for London based companies such as Deliveroo, Just Eat and Unruly. And with more software developers than any other European city, big data, SaaS and cybersecurity all feature in the top 10 sub-sectors for venture capital investment into London companies since 20111.

The findings have been released by the founders of London Tech Week, Europe’s largest festival of technology, which will see over 300 events hosted across the capital from 12-16th June. Over 40,000 visitors from all over the world will be able to attend a range of events which will showcase some of the latest technologies in VR, robotics, drones, autonomous vehicles, Artificial Intelligence and fintech – find out more about the full event programme here.

London’s place as a leading global investment hub will also be discussed at the two-day (13-14th June) LeadersIn Tech Summit, hosted by Google. Bringing together leading investors, executives and entrepreneurs from London’s tech community, the LeadersIn Tech Summit will feature a Think Tank on the future of investment with speakers at the event including Eileen Burbidge, Partner at Passion Capital; Ronan Harris, Managing Director, Google UK & Ireland and Matt Hancock, Minister of State for Digital and Culture. A full list of speakers and more information can be found here. 

Notes to Editors

Data sources

  1. Investment data showing venture capital investment into London tech sub-sectors from 1st January 2011-31st March 2017. Data sourced by PitchBook. Downloaded on 31/03/2017
  2. Investment data showing the growth in venture capital investment into London sub-sectors from 1st January 2011-31st March 2017. Data sourced by PitchBook. Downloaded on 31/03/2017
  3. Investment data showing venture capital investment into London tech companies from 1st January 2017-31st March 2017. Data sourced by PitchBook. Downloaded on 31/03/2017

Table showing the top 10 sub-sectors for venture capital investment into London technology companies from 1st January 2011 until 31st March 2017.

Sub-sector

Amount invested (£) ‘000s

Fintech

2019.21

Mobile

1755.82

SaaS

1784.04

E-commerce

1556.15

Big data

334.26

AdTech

283.55

AI & Machine Learning

207.21

CleanTech

259.48

Marketing Tech

193.48

Cybersecurity

109.27

NB: Data sourced from PitchBook, downloaded on 31/03/2017. Sub sectors defined by PitchBook

Table showing the top 5 fastest growing sub-sectors for venture capital investment into London technology companies from 1st January 2011 until 31st March 2017.

Sector

% growth

Robotics and drones

30500

Big Data

2602

AI & Machine Learning

2288

AdTech

826

Ecommerce

539

 

About London Tech Week

London Tech Week is a festival of events, taking place across the city and representing the entire technology ecosystem.

No other festival of live events brings together as many domestic and international tech specialists and enthusiasts to London for such a variety of networking, social, learning and business opportunities.

Since its launch in 2014 London Tech Week has included more than 700 events and has welcomed delegations from around the world.

London Tech Week 2017 will be organised by founding partners, KNect365, London & Partners and Tech London Advocates, with support from strategic partners Tech City UK, ExCeL London, DIT and techUK.

More information on can be found https://londontechweek.com/

 

About Informa

Informa’s Knowledge & Networking Division, which operates as KNect365, is the world’s leading facilitator of knowledge sharing and business connections. The KNect365 portfolio connects communities around our leading brands, through year round provision of high quality digital and face to face content, networking and professional development and learning opportunities.

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      

 

About Tech London Advocates

Tech London Advocates is a private sector led coalition of over 4,500 expert individuals from the tech sector and broader community who have committed to championing London’s potential as a world-class hub for tech and digital businesses. It strives to support London’s tech start-ups and high growth businesses in finding new investment new talent and continued success.

Tech London Advocates is an independent not-for-profit organisation, sponsored by City of London Corporation, Penningtons Manches LLP, Russell Reynolds Associates, Breakthrough Funding, Here East, Zumtobel, China Science and Merchants, Cisco, Salesforce, Cocoon Networks and Hewlett Packard.

Contact

Ben Pattie

PR Manager, FDI (Technology)

Email: bpattie@londonandpartners.com

Tel: 0207 234 5872