The United Kingdom recently hosted an impressive event in New York with the goal of enticing more American venture capitalists to invest in their thriving tech industry. As the event was unveiled, attendees were treated to a 3-D hologram display called the Ever-Changing Statue. The hologram, designed by HYPERVSN, features images of top UK unicorn founders such as Tessa Clarke of food waste startup Olio and Alexander and Oliver Kent-Braham of insurance startup Marshmellow. It’s clear that the UK is proudly promoting itself as the “Unicorn Kingdom,” already being recognized as the third largest $1 trillion tech economy, following only the U.S. and China.
While Brexit has had its economic impacts, UK officials want to showcase the growth and success of their tech ecosystem since 2020. Dealroom data shows that UK startups raised an impressive $31 billion in venture capital in 2022, and $41 billion in 2021. Even amidst market retraction, last year still saw a strong investment total of $21 billion, surpassing the combined totals of France and Germany. It’s important to note that this is a significant increase from the $18 billion raised in 2019 and the $12 billion raised in 2018.
Sipping wine and nibbling burrata, a group of government officials, reporters, and founders gathered at its unveiling…
Notably, black founders, who have historically struggled to secure funding, are seeing progress in the UK. A recent report by Extend Ventures revealed that the number of UK Black founders who raised venture capital funding has more than doubled from 38 between 2009 and 2019, to 80 in more recent years.
The UK boasts an impressive 160 unicorns and 12 decacorns (companies worth more than $10 billion), with particular strengths in fintech, highlighted by companies such as Monzo, Revolut, and Wise. It’s also becoming a leading hub for artificial intelligence with the rise of companies like Deepmind and Benevolent AI. Not to be forgotten, there was a hint of playful pride as it was also mentioned that the UK is home to OnlyFans.
The hologram—and the British government officials—are selling potential as the main draw to the UK, a sales pitch clearly designed to boost a sluggish economy.
Despite a slowdown in talent coming from other European countries, the UK continues to see an influx of immigration from other parts of the world, bringing fresh ideas, hires, and potential to the tech industry. Other cities within the UK, such as Manchester and Cambridge, are also experiencing growth in their tech sectors.
Rodney Appiah, co-founder of UK-based venture firm Cornerstone Ventures, spoke to TechCrunch about areas where the UK’s tech ecosystem still has room for growth. He believes there is a need for more funds, accelerator programs, and senior talent to help companies transition from early stage to growth. Paul Taylor, CEO of Thought Machine and one of the individuals depicted on the hologram, echoed the sentiment, stressing the need for more venture funds dedicated to the region. He noted that UK companies often have to seek foreign investments as they grow.
“The UK tech ecosystem has made significant strides, but work remains to reach the scale and influence of Silicon Valley,” Taylor told TechCrunch.
The event in New York, featuring the hologram, was a clear tactic to catch the attention of American startups and investors. A 2023 report by HSBC Innovation Banking — previously SVB — revealed that American investors were the primary source of funding for British startups last year. In fact, The Times reported that more American tech entrepreneurs are purchasing real estate in London, and firms like NEA, Bessemer, and a16z have all opened offices there in recent years.
However, not all investors have been successful in expanding into the UK. Recently, high-profile investors such as Omers and Coatue have significantly downgraded or shut down their European outpost operations based in London.
…it was sold as a sign of the future. “Creating a two-way road between the USA and UK is a win for both countries,” Clarke said.
But what makes the UK stand out to American investors is their willingness to collaborate with them and shape the tech ecosystem together. In fact, their friendly regulatory environment played a role in a16z’s decision to establish a crypto office in London, while the US was implementing stricter regulations on the industry.
Prime Minister Rishi Sunak—the mastermind behind the Unicorn Kingdom initiative—unveiled a plan last year to invest £370 million (approximately $468 million) to support the country’s tech ambitions. The British government also reached an agreement with the UK’s nine largest pension funds to begin investing in startups, with the potential to unlock £50 billion in capital if other pension funds followed suit.
It’s no surprise that the dazzling red, white, and blue hologram was seen as a symbol of the future. The statue will be on display until April 4th, serving as a reminder of the potential and progress of the UK’s tech industry. As Clarke stated, creating a two-way road between the USA and UK is a win-win scenario for both countries.
