The total value of the UK’s tech sector has climbed to its highest ever level this year despite the funding drop-off that has rocked growing technology firms.
British start-ups have reached a total value of $996.8bn according to new data from HSBC Innovation Banking, up from $988bn last year, in a sign the cumulative price tag on the sector has held up despite a turbulent 12 months for the industry globally.
Venture capital funding into start-ups globally has fallen sharply after a series of rapid rate hikes choked off the flow of cheap cash.
Investment into start-ups based in London slowed to $8.6bn across the first nine months of this year, according to the new data, well down on the $19.2bn injected the capital in the same period last year.
Firms across the UK have raised $14bn, a far slower pace than the $31bn raised across 2022.
The numbers come as part of a new ‘Data Commons’ initiative from analysis firm Dealroom and HSBC Innovation Banking – formerly SVB UK before its collapse in March – which looks to shed light on the overall health of the start-up and innovation industry in the UK.
As part of the programme, the two firms are tracking data including job openings, active investors and amount of capital injected into the UK.
“Given the dynamic, fast-paced and unpredictable nature of the innovation ecosystem, the availability of open-access, real-time and accurate data is essential for making informed decisions,” said Erin Platts, chief of HSBC Innovation Banking.
“To date, innovators, investors, policy-makers and decision-makers have found it challenging to build and access a complete picture of the state of UK innovation.”
Tech firms have been rocked by soaring inflation and forced to rein in growth plans globally and slash headcounts.
The robust value figures for UK tech today come despite several high-profile names globally being forced into hefty ‘down rounds’, where they are forced to slash previous valuations.
The UK sits in third place globally, behind just the US and China, in terms of the cumulative value of its tech sector.
The numbers may deliver a boost the government as it mounts an attempt to promote the UK as a hub for growing tech industry.
Rishi Sunak earlier this year launched a bid to market the UK as a ‘Unicorn Kingdom’, in reference to firms worth more than $1bn.
However, analysis by Pitchbook and City A.M. revealed that just one new unicorn had been minted so far this year.
A spokesperson for the government in August said the “UK remains the best place to invest in tech in Europe”.
“Our tech ecosystem attracts more venture capital investment than any other nation in the continent, with start-ups raising over $30bn last year, and we have created more unicorns than France, Germany and Sweden combined,” they added.