The fears of Brexit fail to keep investment in London down – especially in AI, machine learning and robotics.
Emerging technologies are fuelling big venture capital investment in London, with AI, robotics and Big Data among the fastest growing areas for investment.
According to research carried out by the founders of London Tech Week, AI and machine learning in the UK capital has been of particular interest to investors, drawing £85.75m in 2016 – a figure which is 20 times the amount raised just 5 years ago.
An impressive £207 million has been brought in by London’s AI and machine learning companies in the past five years, boosted by deals for companies like Google’s DeepMind and Magic Pony.
Among other emerging technologies, robotics and drones have also bolstered the London VC scene post-Brexit vote, with over £14 million invested in 2016. When compared with the £40,000 raised in 2014 and £70,000 raised in 2015, the sharp increase in this market is all the more evident.
“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,” said Russ Shaw, London Tech Week ambassador and Founder of Tech London Advocates.
“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.”
Since the Brexit vote, UK companies and leading public figures have been vocal in assuring investors that London remains open for business. Many in the tech and finance industries forewarned an exodus of talent and money from the capital due to the UK leaving the EU.
London, however has continued to defy the Brexit fear-mongers, with research substantiating London’s claim as the tech capital of Europe. Data from London & Partners found that the UK tech sector drew more investment than that of any European country in 2016, while big names like Google and Facebook have committed to staying in the capital for the long-run.
One major market segment which is helping London retain it’s crown as the tech capital of Europe is fintech. Fintech companies have received over £2 billion of VC investment in the last five years – greater than any other sector including SaaS, Mobile and e-commerce. 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.
Further silencing the Brexit fear-mongers is the performance of the capital in Q1. In the first quarter of the year London tech firms received £395 million in venture capital investment – significantly more than the £245 million raised in Q4 of 2016. 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.
“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,” said Deputy Mayor for Business, Rajesh Agrawal.
“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.”