Russ Shaw, founder of Tech London Advocates, organizer of London Tech Week, said: “2021 has been an unprecedented year for the British tech industry – out of 321 unicorns in Europe, the UK is home to over 100”
Investment in tech across Europe is set to exceed $100 billion in 2021 as the industry’s ecosystem further develops, a major new report has revealed.
The latest annual “State of European Tech” report said hitting the milestone is a sign that the continent is “consolidating its place as a global tech power”.
The report, prepared by venture capital firm Atomico, found that Europe accounted for 33% of total capital invested worldwide in early-stage startups this year – putting it on par with the US for the first time.
The report found that the industry added $1 trillion in value in the first eight months of 2021 alone. A total of 100 new unicorns – startups worth more than $1 billion – were minted in 2021, up from 223 in 2020.
Addressing industry in 45 countries, the Intensive report argued that the continent’s tech ecosystem is now set to prosper even when macro conditions – such as inflation and stock market performance – change.
Russ Shaw, founder of Tech London Advocates, organizer of London Tech Week, said: “2021 has been an unprecedented year for the British tech industry – out of 321 unicorns in Europe, the UK is home to over 100 of them and the UK now stands strong. The US and China as the world’s third global tech ecosystem.”
Atomico’s Sarah Gurmauri said that “even in a conservative scenario, we expect European technology to at least double in the coming decade and add trillions of dollars in value”.
The findings of the State of European Tech report were not all positive, however, concluding that the sector still has a long way to go in terms of investment in women and minority-led companies. The research found that mixed and diverse teams captured just 9% of the total capital raised by tech firms in Europe this year.
Of the participants surveyed, 49% of women and 39% of non-white founders said they found it difficult to raise funds.
Shaw said: “We cannot allow record investment figures to paper over a reasonable lack of progress in rectifying the lack of diversity in the industry.
“Diversity in technology is unforgivably bad. Over 1% of total VC funding in Europe went to founding teams made up of ethnic minorities only – diversity should not be considered.”
The report also pointed out how European pension funds are still giving less than 0.03% of their allocation to venture capital – and argued that a shift towards just 1% would be a “seismic shift”.
Many say that if British pension funds invested more in VCs, as large Canadian pension funds already do, the huge long-term returns generated by successful tech firms would be shared by working people as well as wealthy investors.
The report also found that although the crypto and blockchain deal count in Europe had increased 5 times over the past 5 years, the continent still lags behind the US in this area.