Global tech investors continue to put their faith in London

According to data from Dealroom, London helped boost the total amount of venture capital (VC) funding secured by UK tech firms in 2022 to $29.9bn, making it the third largest country for tech investment behind the US and China. 

Some of the biggest funding rounds into London companies last year included a $1bn Series D round for Checkout.com, a $312m Series G round for Go Cardless and a $200m Series D for Paddle.

Despite global VC funding experiencing a 33% dip from the record levels seen in 2021, with a total of $485.2bn raised last year compared to $723bn the previous year, the future investment landscape for London and UK companies remains optimistic. Dealroom also revealed an increasing volume of growth capital being added by VCs to new funds in London.

The total amount of fresh capital raised by London-based VCs in 2022 was $6.6bn, more than any previous year. 

This takes the total raised in the past two years (2021 and 2022) to $11.4bn. Additionally, some of the world’s largest investment firms have established new funds or a presence in London in the past year, including a $1bn early-stage fund from Northzone, a $650m European investment fund from Atomico, and a $500m fund from Phoenix Court.

London’s Edtech, Cybersecurity, and gaming sectors all raised more funding in 2022 than in 2021, according to data from Dealroom. The city’s fintech sector also saw a strong performance in 2022, with UK capital’s fintech firms raising a total of $9.7bn – more than any other city globally. 

In addition to seeing more investment than the likes of New York and the Bay Area, London fintech’s accounted for 42% of the total funding into all European fintech last year.

Sustainability brings in the money

Another sector showing promising signs of future growth for London is impact tech – companies that put at least one of the UN’s sustainable development goals at the heart of their mission. London’s impact tech companies raised over $2bn in VC funding last year and now account for more than 10% of all London VC funding for the first time.

Laura Citron, CEO of London & Partners said: “London‘s tech sector is looking resilient, despite the challenging context. Investors have raised more capital to deploy into high-growth companies than ever before. Innovation in London continues to be grounded in the city’s deep historic strengths – so we see sectors like Fintech, EdTech and gaming thrive. This data shows that London continues to be Europe’s tech capital and one of the best places in the world to scale a tech business.”