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Key takeaways

● VC investment into London's tech sector remained resilient in 2020 despite the global pandemic with the capital’s tech companies raising a total
of $10.5B in VC funding last year – close to the record levels ($10.7B) seen in 2019

● The future outlook for London’s tech scene looks promising – London VC firms raised record levels of fresh capital to deploy in 2021, Europe’s
largest number of future unicorns and high levels of investment across some of the fastest growing global sectors for tech VC funding

● London is the driving force behind Europe’s tech ecosystem – with the UK capital accounting for more than a quarter of all European venture
capital investment in 2020 and significantly higher levels of VC investment than any other European city over the past five years

● On the world stage, London is Europe’s truly global tech city, ranking as the second fastest growing tech ecosystem in the world since 2016 and
consistently featuring as the only European city in the global top 10 for VC investment

● London’s tech sector is showing increasing levels of maturity, with growing levels of a later-stage funding and a more internationally diverse mix
of investors entering its ecosystem

Page / 2 Source: Dealroom.co.

London tech companies raised near record investment in 2020, accounting for more
than a quarter of all European venture capital investment.
Venture capital investment in London Top rounds in London 2020

$10.7B $10.5B

$500M $500M $400M

Series D Growth Equity Growth Equity

$6.4B
£300M £252M $310M
$5.7B Late VC Series A Series D

$3.5B
$200M $200M £150M
Series A Series D Growth Equity

$150M $125M $120M

Series B Series B Series B

2016 2017 2018 2019 2020

/3 Source: Dealroom.co.
London is the only European city in the global top 10 for VC investment since 2016.

Total VC investment global hubs 2016-2020

Beijing $131.0B

San Francisco $108.0B

New York $76.5B

Shanghai $59.8B

London $36.7B

Bengaluru $23.5B

Boston $19.8B

Singapore $19.7B

Cambridge, US $18.0B

Los Angeles $15.6B

/4 Source: Dealroom.co.
London has been the second fastest-growing mature tech ecosystem in the world
since 2016, with investment growing 3.0x in five years.

VC investment global hubs: 2016 vs. 2020 2016 2020

Bengaluru 5.4x $1.3B $7.2B

London 3.0x $3.5B $10.5B

Munich 2.7x $0.3B $0.7B

Berlin 2.5x $1.2B $3.1B

Paris 2.5x $1.3B $3.3B

Mumbai 1.7x $0.7B $1.2B

San Francisco 1.5x $14.3B $21.5B

New York 1.4x $11.0B $15.2B

Toronto 1.4x $0.7B $1.0B

Shanghai 1.3x $7.9B $10.5B

Shenzhen 1.0x $1.5B $1.5B

Beijing 0.7x $22.2B $16.6B

Source: Dealroom.co.
Page / 5
Note: Rounding to one decimal place in visualization, growth is computed on exact amount. Excludes smaller tech hub outliers where year-on-year fluctuation can be inconsistent.
2020 was a not only a strong year for London – global and European VC showed
resilience despite the pandemic.
Global venture capital investment

United States

Asia

Rest of World

Rest of Europe

London

/6 Source: Dealroom.co.
VCs in London have record levels of dry powder ready to deploy in 2021 and
beyond, having raised $12B in 2019 and 2020 alone.
New funds raised by VCs in London

Seed Series A+ Growth stage

$140M $2B €700M

Feb 2019 Apr 2020 Dec 2020

$250M+

$115M $820M $375M

Jun 2019 Feb 2020 Mar 2018

$100M $735M €300M

Apr 2020 Feb 2020 Mar 2019

$100M-$250M £81M $500M Latitude: $180M

Sep 2020 Nov 2019 Dec 2018

$50M-$100M
£78M $400M £110M
Nov 2020 Sep 2020 Oct 2020
0M-$50M

Page / 7 Source: Dealroom.co.

London is the preferred destination for VC investors – a third of new European
funds have been raised in London in the last two years.
New funds raised by European VCs

$7.8B

$5.8B

$4.0B

$2.7B
$2.3B
$2.0B
$1.7B $1.7B
$1.5B $1.5B
$1.3B
$1.2B
$1.0B $1.0B
$0.7B
$0.4B $0.3B $0.3B $0.6B
$0.1B

2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

London Paris Berlin Amsterdam

Page / 8 Source: Dealroom.co.

London startups also attract high levels of international investor interest,
particularly at later stages of growth.
% of investment in London (2019-2020) by source and round size

USA and Canada

Asia

Rest of World

Cross-border European

Domestic

Source: Dealroom.co.
Page / 9
Note: The labels “Seed”, “Series A” are standardised labels per Dealroom.co method, not the reported labels as they are not consistently applied.
London startups have a more internationally diverse mix of investors compared to
other European tech ecosystems, with 57% of capital coming from outside Europe.
% of foreign investment (2019-2020) by city and source

Page / 10 Source: Dealroom.co estimates.

 London’s biggest sectors for VC investment are also among the fastest-growing
global startup sectors.
Global VC funding in five fastest-growing sectors (2016-2020) Venture capital investment in London by sector (2020)
█ Europe █ USA █ Asia

Fintech 41%
Health $28.7B $139.6B $41.4B $210B

Enterprise
17%
Software

Transportation $14.7B $71.6B $102.5B $189B Transportation 14%

Health 7%

Fintech $33.4B $73.9B $71.2B $178B

Energy 7%

Cybersecurity 6%
Enterprise
$26.4B $108.0B $30.2B $165B
Software
Food 6%

Real Estate 5%
Food $9.9B $32.4B $45.9B $88B

Page / 11 Source: Dealroom.co.

In 2020, London raised almost half of all Europe’s fintech capital.

Amount invested in fintech startups

$10.7B
VC investment in fintech
2019 2020 % change
by city
$8.8B London $5.5B $4.3B -22%

$5.2B Paris $0.6B $0.7B +5%

Berlin $1.3B $0.5B -60%

$5.6B Rest of Stockholm $1.0B $1.1B +15%

$4.5B Europe
$5.1B
Amsterdam $0.1B $0.2B +77%

Munich $0.1B $0.1B -17%

$3.2B $3.4B
$2.9B
Top London rounds in 2020
$5.5B
$1.9B
$4.3B London
$500M $500M $150M
$2.2B $2.2B Series D Growth Equity Series B
$1.3B

2016 2017 2018 2019 2020

Source: Dealroom.co.
Page / 12
Note: Rounding to one decimal place in visualization, growth is computed on exact amount.
Enterprise Software investment in London is double that of any other European
city, and continued to grow in 2020.
Amount invested in enterprise software startups
$7.4B
$7.0B
VC investment in
enterprise software by 2019 2020 % change
city
London $1.0B $1.9B +82%

Paris $0.7B $1.0B +35%

$4.6B Berlin $0.7B $0.6B -13%
$4.5B
$5.1B Rest of
$6.4B Europe Stockholm $0.1B $0.0B -71%

Amsterdam $0.1B $0.3B +192%

$3.1B
Munich $0.5B $0.2B -61%
$3.4B
$3.5B

Top London rounds in 2020

$2.6B

$1.9B London $200M $200M $80M

$1.2B Series A Series D Series E
$1.0B $1.0B
$0.5B

2016 2017 2018 2019 2020

Source: Dealroom.co.
Page / 13
Note: Rounding to one decimal place in visualization, growth is computed on exact amount.
Investment into London-based transportation startups has grown 7.5x in five
years.

Amount invested in transportation startups

$4.8B

VC investment in
2019 2020 % change
transportation by city
$4.0B
London $0.3B $1.5B +340%
$x.xB Paris $0.2B $0.1B -51%

$3.0B Rest of Berlin $0.8B $0.8B -5%

$3.3B
Europe Stockholm $0.2B $0.2B +2%

Amsterdam $0.1B $0.3B +262%

$1.9B
$3.7B Munich $0.6B $0.1B -86%

$1.1B $2.9B
Top London rounds in 2020
$1.8B

$0.9B $1.5B London

$400M $310M £150M
Growth Equity Series D Growth Equity

$0.2B $0.3B
$0.1B $0.1B

2016 2017 2018 2019 2020

Source: Dealroom.co.
Page / 14
Note: Rounding to one decimal place in visualization, growth is computed on exact amount.
London healthtech startups collectively raised more than any other European hub.

Amount invested in healthtech startups

$8.3B

$7.2B
VC investment in
2019 2020 % change
healthtech by city

London $1.0B $0.7B -29%

$5.7B Paris $0.7B $0.5B -31%

Berlin $0.4B $0.4B -5%

Stockholm $0.1B $0.3B 287%

$3.9B Rest of
$7.6B
$3.7B $6.2B Europe Amsterdam $0.0B $0.1B 270%

Munich $0.1B $0.2B +68%

$5.3B

$3.2B
Top London rounds in 2020
$3.4B

$100M $80M $70M

Convertible Series B Series B
$1.0B
$0.7B $0.4B London
$0.3B $0.7B

2016 2017 2018 2019 2020

Source: Dealroom.co.
Page / 15
Note: Rounding to one decimal place in visualization, growth is computed on exact amount.
London-based Karma Kitchen raised Europe’s biggest foodtech round in 2020.

Amount invested in food startups

$3.0B

$2.6B VC investment in
2019 2020 % change
foodtech by city

London $0.8B $0.6B -21%

Paris $0.1B $0.2B +63%

$1.9B
Berlin $0.2B $0.2B -11%
$2.2B
$1.5B Stockholm $0.1B $0.1B +4%
Rest of
$2.0B
Europe Amsterdam $0.2B $0.0B -94%

Munich $0.0B $0.0B +34%

$0.9B $1.5B

$1.4B Top London rounds in 2020

$0.6B

$0.8B $41M
$333M $70M
$0.6B London Series A Series C Late VC
$0.4B
$0.3B
$0.1B

2016 2017 2018 2019 2020

Source: Dealroom.co.
Page / 16
Note: Rounding to one decimal place in visualization, growth is computed on exact amount.
 Fintech ranks #1 in Europe and London for unicorns and future unicorns.

European unicorns and future unicorns by industry Unicorns and future unicorns by industry in London

Fintech 47 83 Fintech 18 36

Health 41 87 Enterprise Software 7 20

Enterprise Software 53 70 Marketing 1 9 3

Transportation 18 30 Health 3 5 Unicorns

Marketing 15 25 Transportation 4 3 Future Unicorns

Energy 4 26 Fashion 3 4

Food 12 17 Energy 1 5

Cybersecurity 7 15 Cybersecurity 1 5

Page / 17 Source: Dealroom.co.

London is the unicorn capital of Europe.

Number of unicorns by city Number of future unicorns by city

London 43 London 81

Berlin 11 Paris 42

Paris 11 Berlin 32

Amsterdam 9 Munich 11

Stockholm 9 Cambridge, UK 9

Munich 5 Dublin 9

Hamburg 4 Amsterdam 7

Manchester 3 Barcelona 7

Cambridge, UK 3 Stockholm 6

Madrid 2 Madrid 5

Copenhagen 2 Zurich 5

Page / 18 Source: Dealroom.co.

Methodology and definitions

• Investment numbers refer to venture capital investment rounds such as seed, series A, B, C, …. late stage, and growth equity rounds. It excludes
debt or other non-equity funding, lending capital, grants and ICOs.

• Buyouts, M&A, secondary rounds, and IPOs are treated as exits: excluded from funding data, but included in exit data.

• A unicorn is defined as a rapidly scaling company (and tech enabled) that has reached a $1 billion valuation, on the basis of a funding round
(unrealised), acquisition or IPO (realised).

• There are some notable edge-cases:

○ Companies that IPO-ed at or above $1 billion but subsequently dipped below that valuation, are still included as a $1B+ exit (examples: Alfa,
Rovio, eDreams).

○ Some companies have at some stage reached a $1 billion but subsequently raised, IPO-ed or were acquired below that value. In this case the
company is not counted as a unicorn (examples: Blippar, Home24).

○ If a unicorn moved HQ, the company is counted in the country where it reached unicorn status. Occasionally companies received dual HQ
status.

• A future unicorn is defined as a tech driven company valued at over $250 million but less than $1 billion, excluding acquired and/or public
companies.

• This report focuses on companies in the information age, i.e. after 1990. Most (but not all) unicorns are VC backed.

Page / 19 Source: Dealroom.co.