While many sectors have been hit hard by 2020’s Covid-19 pandemic conditions, the technology sector has thrived. That’s a reality confirmed by a report published today by the UK’s Department for Digital, Culture, Media and Sport (DCMS), which calculates that British tech companies have raised a record $15 billion in investment this year.
Prior to 2020, the highest ever figure attracted by the sector was 2019’s $14.8 billion. And this year’s tough conditions haven’t prevented that total being bested 12 months later. British technology company’s raised more capital than peers from Germany and France combined.
The biggest funding rounds were secured by online-only challenger bank Revolut, and digital insurer Ki, who brought in $500 million each. Technology-centric utility company Octopus Energy this month secured a $200 million investment from Tokyo Gas, and online payments group Gocardless banked $95 million as the year entered its late stages.
Investor appetite for all things tech has been whetted by the belief the Covid-19 pandemic is accelerating the trend towards a heavily digital economy. That’s also been reflected in huge gains for publicly-listed technology companies. Ocado, the online grocer and warehouse technology company that is now one of the UK’s biggest tech companies, has seen its valuation in increase by 76% this year.
And there’s lots of employment demand for the tech specialists needed by these companies to keep developing. A report put together for the DCMS by jobs search engine Adzuna and start-up data company Dealroom, shows technology job vacancies are up 50% since July. Tech vacancies now count for 1 in 10 advertised and the sector employs 3 million in the UK.
Suranga Chandratillake, a partner at the venture capital firm Balderton Capital, commented that attracting $15 billion of investment was an “astounding feat for the UK’s tech industry”, despite the general global trend favouring the sector.
The largest portion of the $15 billion invested went to technology companies based in London, which accounted for $10 billion of the total. $535 billion was drawn to companies based in Oxford’s ‘tech cluster’, including $84 billion raised by Covid-19 test maker Oxford Nanopore.
That sees Oxford leapfrog Cambridge in the league table of cities drawing technology investments. Leeds, Newcastle and Glasgow all attracted more technology investments than in previous years.
The UK is now home to 80 ‘unicorn’ companies – still private firms valued at $1 billion or more. Most are considered tech companies. Among the new ‘unicorns’ this year are electric bus company Arrival and recipe box service Gousto.