CAPITAL WATCH ISSUE 1 2018

London’s fintech firms accounted for over 90% of all money raised by UK fintech firms last year London’s position as the leading global finance hub provides ample access to funding, while the large tech companies located in the capital are sources of expertise, capital and potentially direct investment. Startup Genome estimates that early stage funding per startup in London is $451,000 compared with a global average of $252,000. The vote to leave the EU has not diminished the capital targeting the UK’s tech firms. In 2017 venture capital investment into the UK tech sector reached a record high. London tech firms were the main beneficiary of this investment, accounting for 80% (£2.45bn) of all UK venture capital tech funding. London’s fintech firms accounted for over 90% of all money raised by UK fintech firms last year. 2017 saw major funding rounds for financial technology companies such as TransferWise (£211m), Funding Circle (£81.9m) and Monzo (£71m). London’s Artificial Intelligence (AI) companies also saw elevated levels of funding in 2017. Big deals for companies such as Babylon Health (£47.5m), Callsign (£26.9m) and Starship Technologies (£13.9m) saw investment in London AI companies reach over £200m (>50% more than 2016). It’s not just VC funding where London is leading the way. Despite the challenges around Brexit, London is a key destination for US companies looking to access the European market; foreign direct investment into the technology sector continues to expand year on year. Data from EY shows that London is Europe’s leading city, attracting significantly more investment projects and jobs than any other European city for each year during the last decade - and the gap between London and the regions is widening. Access to capital and funding Startup ecosystem London has developed into Europe’s capital, and one of the leading global cities, in terms of the startup ecosystem it supports. Attracted by the availability of funding, world- class universities, market reach and the ability to collaborate with influential organisations, London has become the European city of choice for startups. The numbers of active startups vary depending upon the definition, but there is no doubt that London has one of the highest concentrations of startups in the world. Businesses have now established themselves in clusters all over the city - not just in Shoreditch. London’s digital tech industries grew one-third faster than the wider economy “according to Tech Nation 2016” and only New York and Silicon Valley have produced more startups worth over £50 million. Global connectivity is a key part of the success of London in attracting startups and encouraging innovation in the capital. London is the most connected city in Europe and second globally behind Silicon Valley, with entrepreneurs and tech companies having a strong international network that provides global reach for ideas and business. CUSHMAN & WAKEFIELD 05 COVER STORY