Britain leads in tech investments

The total number of technology companies that have reached “unicorn” status in Europe — a valuation of $1 billion or more — has grown from 223 last year to 321, according to a new report from Atomico, the venture capital firm.

Examples include the $2.75 billion invested in Northvolt, a Swedish battery business, in June and the $1.3 billion secured by the UK’s Cinch, an online used car marketplace, in May.

The more than $100 billion due to be invested in European technology firms this year is more than ten times the level shown in 2015.

Bumper late-stage funding rounds of more than $250 million have become “the norm” across Europe, Atomico said, and now represent 40 per cent of the total capital invested in Europe. London-based businesses secured the most capital, while Cambridge was chosen as the “unicorn capital of Europe” in terms of the number of these businesses created per inhabitant, thanks to its “high concentration of talent”.

Its annual report found that Europe has its “strongest ever pipeline of early-stage start-ups”, accounting for 33 per cent of all capital invested globally in rounds of up to $5 million.

Sarah Guemouri, a senior associate at Atomico and co-author of the report, added: “Even in a conservative scenario, we expect European tech to at least double in the coming decade and add trillions of dollars worth of value.”

According to a report, Britain is leading the way in an investment boom in Europe’s technology industry, with more than $100 billion of venture capital deployed this year, three times the level of that in 2020.

Tom Wehmeier, a partner at Atomico and co-author of the report, said the “scale and pace of growth” had changed.

The UK topped metrics, including total capital invested and unicorns created.

The report shows 98 unicorns were created across Europe this year, although Wehmeier noted two more had been added since the research was finalised. However, the venture capital industry performed poorly on diversity, with teams of mixed genders and ethnicities only receiving 9 per cent of the capital raised so far in 2021. While large, late-stage funding rounds drove the record level of overall funding, Atomico noted that early-stage investment levels are now on a par with those of the United States for the first time.

During the first nine months of 2021 alone, there have been 68 rounds of more than $100 million in the UK.

The research combines data from 45 countries with a survey of 5,000 people in the technology industry.

Summarised www.sba.tax

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