UK becomes only the 3rd tech ecosystem worth US$1 trillion
- The UK tech industry is now worth more than double that of Germany’s and almost 5x larger than France, Sweden
- Thr fastest growth took place between 2020 and 2021, when the ecosystem increased by 42%
When the pandemic broke out in 2020, much of the world moved online, accelerating a digital transformation that had been slowly underway for decades. Digital adoption took a quantum leap not just at consumer level, but also at both the organizational and industry levels. In the UK particularly, the Covid-19 had propelled the country’s tech ecosystem into a new league pushing it to worth US$1 trillion in value — only the third global economy to ever reach this landmark valuation.
According to Dealroom data analyzed for the UK’s Digital Economy Council, the “UK’s thriving digital economy” is now worth more than double that of Germany’s and almost 5x larger than France’s and Sweden’s. UK’s digital minister Chris Philp said that the country’s tech industry “has gone from strength to strength, overtaking the rest of Europe and entering the history books as the third country ever to reach this milestone.”
Chris reckon that every corner of the country has contributed to the sector’s success “including the West Midlands whose digital ecosystem is set to keep growing by at least £2.7 billion by 2025 and create 52,000 additional jobs.”
In 2018, the UK tech ecosystem was valued at US$446 billion and was steadily growing until 2020, when it doubled in value to US$942 billion as investments into software and digital companies surged at the start of the Covid-19 pandemic, both in private and public markets.
“That in turn, has helped to catapult the valuations of many companies from unicorns — companies valued at US$1 billion or more — to the even rarer decacorn status (companies worth over US$10 billion),” Dealroom statement reads. Fast forward today, the UK now houses 13 decacorns of which 10 have gone on to IPO, and are the most highly valued tech companies in the country.
The 13 decacorns, according to Dealroom, are double that of Germany (six) and three times’ the number of those in Sweden (four). “While most of the UK’s decacorns and unicorns are concentrated in London, there are now 44 unicorns spread out across the regions and 100 regional futurecorns that are laying the groundwork for future success across the country,” the statement reads.
In just the first three months of this year alone, UK tech companies have raised over £6 billion with more than half (£3.3 billion) raised by fintech companies including FNZ, Checkout.com, and GoCardless. “This is an indicator of the strength of the sector with private tech valuations continuing to hold up well despite falling valuations in public markets,” Dealroom added.
Separately, as per a government’s statement, tech investment in the UK grew from £11.5 billion in 2020 to £29.4 billion last year, the highest growth since 2013-to-2014 when it grew from US$2 billion (£1.5 billion) to US$4.6 billion (£3.5) billion.
“The combined value of UK tech companies founded since 2000* is now £540 billion, after the biggest year-on-year increase since 2013/14,” the statement reads.
8 June 2023