Top 10 startup stories of 2021
Computer Weekly’s startup protection in 2021 was formed by long-term however inconsistently distributed success of the UK’s startup ecosystem, in addition to its partial restoration from the continued Covid-19 pandemic.
For instance, whereas many stories touched on the record-setting funding raised by UK tech startups, others confirmed this funding was extremely concentrated in a comparatively small quantity of London-based scaleup corporations.
Despite the long-term progress of the ecosystem – with one tech enterprise being created each half-hour – the federal government was additionally pressured to take fairness stakes in additional than 150 startups consequently of the pandemic.
Other stories centered on particular corporations, akin to Glitch which signed a collective bargaining settlement with its white-collar staff, and people working to attain the United Nations’ Sustainable Development Goals (SDGs).
1. London obtained quarter of all European tech funding in 2020
At the very begin of the yr, it was revealed that London-based expertise startups obtained $10.5bn of enterprise capital (VC) funding in 2020, accounting for 1 / 4 of all European tech funding.
The analysis, carried out by market intelligence agency Dealroom and funding company London & Partners, confirmed {that a} important chunk of the funding, $4.3bn, went to London’s monetary expertise (fintech) corporations, whereas $1.9bn went to corporations growing enterprise software program applied sciences – an 82% enhance on the earlier yr.
The figures marked a major enhance from the capital raised by London corporations in 2017 and 2018 – $7bn and $5.9bn, respectively – and got here near eclipsing the document $10.7bn raised in 2019.
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2. UK ‘impact startups’ elevate £2bn in 2021
UK expertise startups addressing a number of of the United Nations’ Sustainable Development Goals (SDGs) raised £2bn in 2021, up from £1.7bn in 2020
Investment in these corporations, also called “impact startups”, has elevated by 127% since 2018, and the UK now has practically 900 startups and scaleups working throughout a variety of applied sciences.
These corporations have a mixed price of £50bn and make use of greater than 35,000 folks, with most of the capital raised going to corporations engaged on clear vitality and different local weather change-related applied sciences.
Collectively, local weather tech corporations make up 65% of the offers signed by affect startups all through 2021. Among these are corporations akin to inexperienced vitality supplier Octopus vitality, which raised the most important funding spherical of any affect startup at £438m; electrical automobile subscription platform ONTO, which raised £130m; and waste administration and recycling agency Plastic Energy, which raised £123m.
Outside of local weather tech, a quantity of UK affect startups are how expertise can assist remedy international well being issues. BenevolentAI, for instance, makes use of huge information and deep studying to find more practical medicines, whereas Huma allows distant affected person monitoring to cut back hospital readmission charges in international locations together with the UK and Germany.
3. Glitch indicators collective bargaining settlement with unionised staff
Employees at software program startup Glitch signed a collective bargaining settlement with the corporate by way of their union, which claimed it was the primary time such a deal has been signed by white-collar tech staff within the US.
The settlement, which took impact on 28 February 2021 and can final 11 months, got here a yr after Glitch’s workforce voted to unionise beneath the Communications Workers of America’s (CWA) Local 1101 department in March 2020.
The effort to convey Glitch staff into the CWA was half of the union’s Campaign to Organize Digital Employees (CODE-CWA), which launched in January 2020 to assist staff within the tech business construct up their energy.
Although the settlement – which is a authorized contract between the union and Glitch – doesn’t embody something about increased wages, that are “already generous” in accordance with a union spokesperson, it does embody vital protections for staff.
4. UK expertise enterprise created each half-hour in 2020
A brand new expertise enterprise was created each half an hour throughout 2020, with practically 19,500 registering in whole throughout the UK, business figures revealed in March 2021.
Data analysed by business physique Tech Nation for the Department of Digital, Culture, Media and Sport (DCMS) – primarily based on figures offered by the Office for National Statistics (ONS) and Companies House – confirmed that 19,465 new companies have been registered within the info and communication sector between January and December 2020.
The enhance within the quantity of expertise companies coincided with a document yr for enterprise capital (VC) funding, which noticed UK-based expertise corporations elevate a complete of $15bn – a major proportion of the $43.1bn raised by European corporations all through 2020. However, most of the capital raised by UK corporations ($10.5bn) went to these in London.
5. One-fifth of all UK tech funding went to only 10 scaleup corporations in 2020
According to Tech Nation’s seventh annual report, simply 10 expertise scaleups obtained one-fifth of all UK enterprise capital (VC) funding throughout 2020.
Investment within the UK tech sector hit $15bn in 2020 – $200m increased than the earlier document set in 2019 – however about 20% ($3.5bn) went to only 10 scaleups, eight of that are London-based.
Only e-commerce enterprise Gymshark and semiconductor producer Graphcore are situated exterior the capital, in Solihull and Bristol, respectively.
Seven of these corporations – Octopus Energy, Arrival, Cazoo, Gymshark, infobip, Gousto and Hopin – reached unicorn standing in 2020, which implies they’re now every valued at greater than $1bn.
6. UK tech sector grows tenfold in 10 years
The UK’s expertise sector has seen a tenfold enhance in each enterprise capital funding and the quantity of billion-dollar “unicorn” corporations (these valued at greater than $1bn) over the previous decade, in accordance with figures launched in May by the federal government’s Digital Economy Council and Dealroom.co.
Between 2010 and 2020, funding within the UK’s tech business grew from £1.2bn to £11.3bn, with most of this enhance going down since 2015 when funding was £4.1bn.
There has additionally been a tenfold enhance within the quantity of unicorns, which elevated from eight in 2010 to 81 by the tip of 2020. An additional 10 unicorns have been created between the beginning of 2021 and May.
Out of these unicorns, 32 have been fintech corporations, 14 centered on enterprise software program and 13 have been in well being tech – sectors which have persistently attracted probably the most capital over the previous decade.
7. UK authorities takes fairness shares in additional than 150 startups
Data from the British Business Bank launched in September revealed that the UK authorities has taken stakes in 158 high-growth startups after its Covid assist loans transformed into fairness.
Launched in April 2020 by finance minister Rishi Sunak to assist startups and loss-making corporations with the funding wanted to remain afloat through the pandemic, the Future Fund scheme’s funding got here within the type of convertible mortgage notes, giving the UK authorities fairness shares within the enterprise when the funding is transformed.
Tech-related corporations on the record embody Vaccitech plc, which co-invented the Covid-19 vaccine with the University of Oxford; Century Tech, an training platform that makes use of synthetic intelligence (AI) to personalise studying for kids; gig ticketing app Dice FM; and Ripple Energy, which permits clients to purchase shares in wind farms.
According to British Business Bank CEO Catherine Lewis La Torre, the Future Fund was integral to making sure funding continued flowing to high-growth startups, with greater than £1bn of convertible loans being issued to almost 1,200 corporations in whole.
8. UK tech sector on observe for an additional document yr of funding
The UK is creating virtually $1bn “unicorn” expertise enterprise every week after inflow of £13.5bn enterprise capital (VC) funding within the first six months of the yr, setting the tech sector up for an additional document yr of funding in 2021.
The UK is now dwelling to 105 unicorns, 20 of which reached unicorn standing within the first six months of 2021 alone, together with Tractable, Zego and Depop. By comparability, Tech Nation claims it took from 1990 to 2014 for the UK to create its first 20 unicorns.
From these 20 corporations, 11 are monetary expertise (fintech) corporations, which as a subsector attracted £4.2bn of the overall raised. After fintech, healthtech attracted the second highest quantity (£2.7bn), adopted by enterprise software program (£1.3bn) and transportation (£1.1bn).
The quantity of potential future unicorns additionally elevated, from 132 corporations in May 2021 to 153 within the newest figures.
9. UK authorities pronounces security tech problem fund winners
The UK authorities introduced the 5 winners of its Safety Tech Challenge Fund, who will every obtain £85,000 to assist them advance their technical proposals for brand spanking new digital instruments and functions to cease the unfold of youngster sexual abuse materials (CSAM) in encrypted communications.
Launched in September 2021, the problem fund is designed to spice up innovation in AI and different applied sciences that may scan, detect and flag unlawful youngster abuse imagery with out breaking end-to-end encryption (E2EE).
The fund is being administered by the Department for Digital, Culture, Media and Sport and the Home Office, which can make further funding of £130,000 out there to the strongest tasks after 5 months.
Digital minister Chris Philp informed Computer Weekly that CSAM-scanning was the one inherent use of the applied sciences, and that the federal government wouldn’t mandate its use past this objective.
10. Tech startups flip to digital PR platform for media publicity
Early-stage expertise startups within the UK are utilizing digital public relations (PR) platform Newspage to assist enhance media visibility and safe additional funding.
Conceived through the UK’s first nationwide lockdown, Newspage allows startups to create and disseminate their very own publicity with out the involvement of costly PR companies whose prices are prohibitive to many early-stage startups.
While Newspage is designed to be used by any small companies working within the UK, the newest vertical its founders are focusing on is expertise startups.
“I’ve worked with tons of tech startups that are bootstrapping and have hardly any cash – they come to see PR agencies, it’s £1,000 a day or even £500 a day, but its beyond their budget. Until they get an angel investment or VC [venture capital] backing, they’re off the radar,” mentioned co-founder Dominic Hiatt.
He added that the underlying idea of Newspage is to be a “port” for connecting media and information organisations with stories that might in any other case be troublesome to search out, and that for startups themselves the platform can assist them elevate cash by elevated visibility.
