It may be hard to imagine, but when we launched our first Tech Innovator in the UK competition a decade ago, the Silicon Roundabout was all anyone could talk about when trying to summarise the UK tech scene. There was no Uber, an exciting online food delivery company had only just launched in London, and the iPhone 5 was the most popular mobile device in the UK.
Today, our lives are organised by apps on our smartphones. UK-grown tech leads the way in health, finance and ESG, and the growth of UK innovation spans ecosystems of digital excellence in every part of the country.
The UK tech sector has one of the most exciting stories to tell from the last decade, growing from small hubs across the four nations to the top tech centre in Europe and the top five in the world.
Valued at over £1tn and sitting behind the US and China, the UK tech sector is punching well above its weight and is a significant part of the UK economy. It has rightly been embraced by policymakers as a key driver for growth and jobs and there is a huge opportunity for the UK to become the third global home for tech.
When we set out on our journey to identify and support the UK’s top innovators back in 2013, we had around 50 applications. The UK had less than 10 tech unicorns and our Venture Pulse research found that less than $4bn of VC money was flowing into the UK, much of it not going far beyond London.
Fast forward a decade and we have had another record-breaking number of applications for our competition, while our Venture Pulse report for 2022 found that more than $34bn was raised by UK businesses with more than 1,500 deals completed outside of the London region, and the UK is one of only three countries around the world with more than 100 unicorn companies.
The response to our competition reflects the strength and growing confidence of tech founders across the country. In 2020, 140 companies entered our competition and this more than doubled to nearly 400 companies this year wanting to tell their story.
The strength of UK tech is not only in the depth of our tech verticals, which attract high levels of global attention and investment, but the diversity of our tech startup ecosystem. Manchester is the fastest-growing tech hub in Europe, whilst South Wales is a world-leading area in terms of compound semiconductors and there are huge opportunities in quantum technologies in Scotland with its traditional strength in the adjacent area of photonics.
The roll call of our previous Tech Innovator winners clearly demonstrates the exciting diversity of the disruptors that we have working across the UK. From London-based What3Words in 2016, to Cambridge-based VividQ in 2020 and last year’s winner, Hull-based HiiROC, the UK has thriving centres of exciting tech businesses, supported by policymakers, businesses and programmes to help drive success in this most vital of sectors.
We can also track through our decade of searching for the best UK innovation to see how many areas of tech UK founders are taking a lead in. From the early days of mostly consumer, health and fintech startups entering our competition through to tech designed to meet the challenges of our most global threats, such as our 2021 winner FIDO Tech which uses tech to detect water leaks in real-time in a bid to end water scarcity.
Supporting UK tech
The US and China are undoubtedly the global tech giants but there is a role for the UK to play given the momentum we have around our tech sector. The UK is not just a specialist in one area but as we learn year on year through our competition, we have strengths across multiple technologies and their applications.
The UK has impressive talent, especially from our universities and a favourable business environment whereby it’s easy to start and exit a business. With a strong science and technology base, the UK is leading the way as an ecosystem for values-led innovation. The UK’s rule of law and regulatory environment is respected around the world and importantly, we have deep pools of investors in the UK and policies like SEIS, VC Trusts, EIS.
The 2023 Tech Nation Report found that UK technology companies could be worth $2.6tn in 10 years if momentum gathered over the last decade is maintained, but this could hit $4tn with government and investor support. The UK is getting better at supporting its fast-growth businesses to scale, but there is much that we can all do to also help in using our skills, networks and expertise to discover those hidden gems of innovation and helping them to develop, access funding and find mentors.
The success of our UK tech sector is not just about the numbers, it’s about the people powering the startups and scaleups. The founders with an idea, a vision and the passion and energy to see their idea through. Over the last decade, entrepreneurs from across the UK have started, built and driven a successful generation of fast-growth businesses whose ideas and solutions are delivering impact.
As one of the judges that gets to watch the pitches of our shortlisted competition finalists, I am in awe of the passion of the founders we meet up and down the UK and the impact their businesses are having.
We can look back on the last decade with pride and admiration. But the hard work that goes into keeping our tech sector relevant, successful and winning on the world stage must continue. We cannot wait to start meeting our competition finalists across the UK this month as we shine a spotlight on some of the most exciting and innovative future unicorns in the UK.
Warren Middleton is lead partner of the Emerging Giants Centre of Excellence for KPMG in the UK.
In partnership with KPMG.
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