Venture capital investment into UK tech companies hit a record high last year, surging 44% as US and Asian funds in particular shrugged off concerns over Brexit.
Startups in the UK won $13.2bn in 2019, according to new figures by Dealroom and TechNation. The influx of funding left eight new startups worth more than $1bn, including Deliveroo, OakNorth, OVO Energy and Babylon.
London also became the fourth most invested city in the world for tech, behind the Bay Area, Beijing and New York.
This surge in investment came in spite of fears of a slowdown over Brexit uncertainty, and was in large part due to huge interest in the UK from outside Europe. Almost half of the UK investments ($6bn) in 2019 came via US and Asian investors, double the previous year.
The rise in UK funding was also in stark contrast to investment in China and the US, which both saw tech funding drop during 2019.
The data also demonstrates how the UK is pulling even further ahead of other European countries, shaking off fears that Brexit uncertainty would reduce investor's appetite.
Other key European countries saw slightly lower rates of growth, with German investment increasing 41% since last year and French investment up by 37%.
“In 2019 the UK secured a formidable 33% of all European Tech investment, at £10.1bn, despite accounting for roughly 9% of Europe’s population,” said Gerard Grech, chief executive of Tech Nation. "The conditions are extremely ripe right now for tech companies to grow," he added.
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The increase in investment comes alongside a sharp jump in the amount of overseas funding originating from both Asia and the US.
In 2018, Asian investment into UK tech startups amounted to just $0.5bn. But this rose more than five-fold in 2019 to $2.8bn, meaning Asian money accounted for 21% of all funding for UK startups.
This figure was boosted by the largest UK round of all time — Softbank's $800m investment in supply-chain finance company Greensill — but also reflects a wider trend towards greater interest from Asian investors in the UK.
“Asian investors are taking a keen interest in the success of the UK’s tech sector and are enthused by our record of building unicorns and leadership in key sectors like AI and clean tech," said Natalie Black, HM trade commissioner for Asia Pacific.
Funding from the US also jumped substantially, with 2019 seeing some of the best-known US venture capital funds taking an interest the European market. In total, US investment into UK startups hit $3.2bn in 2019 — up by 33% on the previous year.
Aside from the increased interest from overseas investors, one of the main drivers of the jump in funding was a standout year for the UK’s fast-growing fintech sector, which brought in almost twice the amount of funding in 2019 than in the previous year.
"2019 was another groundbreaking year for the UK fintech sector with firms raising £4.1bn, an impressive 7.5 times that of French fintechs, and three times as much as those in Germany," said Eileen Burbridge, partner at Passion Capital and chair of Tech Nation.
Other sectors that pulled in large amounts of funding were artificial intelligence, deep tech and clean energy, while some of the largest rounds after Greensill included $575m for food-delivery giant Deliveroo and $550m for doctor app Babylon.