Investment into London startups up by 66% year-on-year as US VC cash flows into the UK capital.
London’s startups have seen a 66% increase on venture capital investments year, thanks in part to more US investors coming across the Atlantic, according to new figures.
London’s digital startup scene received $682m during Q1, up from around $225m for the same period in 2014, according to London & Partners, part of the Mayor of London’s office. It’s also up from the last quarter of 2014, where digital startups received $411.6m.
The news isn’t so good for the rest of the UK, which saw London swallow 80% of the total raised by tech startups in the country for Q1 2015. And although London is ahead of European peers, it still lags behind US tech hubs such as Silicon Valley, which has seen $70bn worth of investment over the past five years, according to the National Venture Capital Association.
London & Partners suggested that part of the surge is from American investment firms, and highlighted deals such as the $20m investment into Cambridge virtual worlds spin-out Improbable, which was backed by US-based venture firm Andreessen Horowitz. It said that of the $1.4bn raised in 2014 for tech firms in London, $795.2m came from US-based investors.
Sherry Coutu, famous Cambridge-based entrepreneur and investor, said: “London has shown that it can produce exceptional companies that grow to scale quickly and become significant players on the international stage. Global investors are increasingly tapping into this ability, providing the funding and access to export markets that companies need to ‘scale up’. This is powering the UK’s entire economy through creating growth and new jobs both in London and beyond.”
