Chair of Tech Nation, Eileen Burbidge
As the UK aspires to be the best place in the world to start or build a digital tech business, the Tech Nation report demonstrates expansion at 2.6x the rest of the economy.
The UK’s digital tech sector continues to accelerate faster than the rest of the economy, according to Tech Nation 2018, the state of the nation report on the sector.
Turnover of digital tech companies grew by 4.5% between 2016-17 compared to UK GDP which grew by 1.7% over the same period, according to official figures compiled by Tech Nation. At the same time the number of jobs in digital tech rose at five times the rate of the rest of the economy.
Tech Nation 2018 is the fourth report of its kind and is published by Tech Nation, a new voice for the UK’s fast-growing digital tech sector. Tech Nation builds on the work of Tech City UK and Tech North and is working to make the UK the best place in the world to imagine, start and grow a digital tech business.
Eileen Burbidge, partner, Passion Capital & chair of Tech Nation says: “From fintech to healthtech, self-driving cars and artificial intelligence, the UK’s digital tech sector is having an impact on every aspect of our daily lives and economy. Tech Nation’s survey of the industry shows that confidence and optimism is high, but it is important for us to keep supporting this sector and give British companies the best chance they can to grow and scale.”
2017 brought the sector some of the biggest fundraisings and exits seen in years, as international investors warmed to funding UK-based firms. British digital tech companies raised £4.5bn in venture capital investment during the year, according to Pitchbook figures, almost double the previous year.
Notable exits included Matchesfashion.com which was sold to a private equity investor for almost £750m and Leeds-based CallCredit acquired by TransUnion for £1 billion.
There were also several so called ‘mega funding’ rounds during the year, with game development platform Improbable raising £370m from Japan’s Softbank, food delivery service Deliveroo raising £284m and mobile network Truphone raising £249m.
A third of London’s businesses have foreign customers, surpassing the 30% of Silicon Valley companies that have overseas customers according to data from Startup Genome, with London the second most connected tech ecosystem globally, behind only Silicon Valley. 25% of the world’s entrepreneurs report a significant relationship with two or more others based in London.
Gerard Grech, chief executive and co-founder of Tech Nation says: “Tech Nation 2018 is the first major milestone of Tech Nation, the organisation now working across the country to build networks that support ambitious entrepreneurs and shine a light on the achievements of our tech sector. The UK’s tech sector is growing almost three times faster than the rest of the economy. What started as Tech City is increasingly Tech Nation. London is the world’s second most connected hub after Silicon Valley. We need to make the most of that, as our new relationship with the EU will undoubtedly force us to be even more adaptive, innovative and ambitious.”
Secretary of State for Culture, Media and Sport Matt Hancock says: "Tech Nation 2018 highlights the extent to which the digital tech sector is providing new energy to the whole economy. The sector is growing faster and providing more high-paying jobs than the wider economy. This is a huge success story for the UK but we also want to make sure that the benefits of the digital tech boom are reaching every corner of the UK, so that we can build a Tech Nation that works for everyone.”
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