UK Aims To Attract World’s Best Tech Scale-Ups to Sector ‘Worth Over $1T’

Key Takeaways

• To help grow the technology sector, the U.K. government is trying to attract foreign investment.
• The U.K.’s tech sector is the largest in Europe.
• France beats the U.K. as the European leader.

According to a recent report  by Tech Nation, the U.K.’s technology sector reached a combined market valuation of $1.1 trillion in 2024.

To help grow the industry further, the government has turned its attention to tech scale-ups, companies that have the potential to grow into multi-billion dollar enterprises.

U.K. Government Courts Scale-Ups

As part of its tech sector push, the government’s “Unicorn Kingdom Pathfinder Awards” (UKPA) recently selected four companies to receive a tailored growth program to scale their business in the U.K.

Winners include Italy’s CyLock, GrubTech from Dubai, the Turkish robotics firm Bottobo and the New York-based Massive Bio.

The winners’ valuations range from a few million to tens of millions of dollars. But none have passed the billion-dollar threshold needed to enter the unicorn club.

In a statement , the Department for Business and Trade said:

“The U.K. is one of only three economies in the world with a trillion-dollar tech sector, closely behind the U.S. and China, and we’re encouraging more tech scale-ups to come to the U.K. and operate here.”

Attracting Foreign Investment

The Labour government has made attracting more foreign investment a key pillar of its growth strategy. In its election manifesto, the party said: “We will use our diplomatic network to attract foreign direct investment into the U.K.”

According to research  by EY, foreign direct investment (FDI) in the U.K. picked up in 2023, bucking the trend for declining growth in Europe.

Growth was driven by a resurgence in digital investment, with the country securing over a quarter (27%) of all European tech projects last year.

The most investment was directed toward Greater London, which ranked as “Europe’s highest performing region for investment.” The country’s second most attractive region was the West Midlands, which was Europe’s seventh best-performing region.

Competing With European Neighbours

Despite the U.K.’s FDI growth, the country still lags behind the European leader, France.

Meanwhile, Chinese and American Big Tech companies, which can be an important source of investment for the technology industry, run their European operations from Ireland due to its lower corporation tax and access to the EU’s single market.

The 2024 IMD World Digital Competitiveness Ranking places the U.K. 18th overall, behind seven other European nations.

The report highlights the country’s strong scientific research community and flow of international students as being among the best in the world. However, infrastructure challenges and a restrictive immigration policy lowered its overall score.

About the Author

James Morales

Although his background is in crypto and FinTech news, these days, James likes to roam across CCN’s editorial breadth, focusing mostly on digital technology. Having always been fascinated by the latest innovations, he uses his platform as a journalist to explore how new technologies work, why they matter and how they might shape our future.

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