Bure Valley Group is an investment introducer platform which links successful investors with exciting, innovative UK startups seeking funding. This content is for information purposes only and should not be taken as financial or investment advice.
A startup ecosystem is a location where startups – in their disparate stages and types – closely grouped together and interact in a system which allows new startups to be created easily, and also scaled quickly. The UK is frequently cited as an attractive place for new businesses since it offers multiple startup ecosystems centring around urban centres such as London, Manchester, Bristol and Leeds. Startups also benefit from a very favourable time zone in the UK, providing them with a great launchpad to begin and scale globally. This reputation has continued despite the economic challenges posed by the likes of Brexit and COVID-19 in recent years.
Below, our investment team at Bure Valley Group offers a round-up of some of the UK’s top thriving startup ecosystems in 2021. We hope you find this content useful. To find out more about our EIS and other investment opportunities, visit our portfolio page here. To enquire regarding our latest projects and funding, you can reach us via:
+44 160 334 0827
According to Startup Genome, London is one of the best technology ecosystems in the world – ranked joint-second with New York, and up from its 2012 position at 8th place. The authors say that this higher award is largely due to the city’s “access to capital, investment and global talent” whilst also benefiting from high connectivity to other global cities – something which puts it at an advantage over Silicon Valley. London is awash with highly-skilled people excelling in the STEM and tech fields, with notable specialisations in fintech and edtech. Moreover, whilst the global average for a seed round is $494k, London’s average stands at $640k.
COVID-19 certainly hit the UK economy hard. Yet one byproduct is that it has accelerated the transition to a digitally-based economy, driving further innovation from entrepreneurs. London’s life sciences sector has particularly risen to the challenge, with 350 medtech companies and world-class universities like King’s College London leading research to fight against COVID-19. Despite this, fintech continues to dominate the fundraising scene – comprising 39% of the $4bn raised in 20202 by London-based companies. Edtech companies also like to call London their home (over 500 of them); a sector which is anticipated to reach $4.4bn in 2021.
Startups naturally gravitate to the capital due to its global standing, interconnectivity and access to funding. Yet the north of England also presents an exciting picture to prospective investors. In Manchester – where the industrial revolution was kickstarted – talent in the region is driving the city’s reinvention as a potent tech hub, particularly as more people relocate from London (i.e. a phenomenon recently called “north-shoring”). Auto Trader has now joined an ecosystem which boasts the likes of AO.com and Boohoo.com.
Manchester’s talent is also formidable. With over 500,000 inhabitants, 39.5% are at working age and hold a minimum qualification of NVQ Level 4. Over 100,000 students roam the city from the three prestigious universities there. Manchester houses a range of accelerator programmes and science partnerships which are targeted specifically at the city’s growing science and technology companies. There are also many investment and loan funds open to new businesses including the Greater Manchester Investment Fund (GMIF) and networks like Angels Den.
In the West country, Bristol is also exhibiting great promise as a startup ecosystem. In 2019, in fact, the city was called the UK’s “leading tech hub” after raising $305m from investors – with only London and Manchester beating it. The previous year, Bristol’s tech businesses turned over £7.9bn combined whilst employing nearly 25,000 people. Bristol-based tech giants OVO Energy, Graphcore and Ultrahaptics have been designated as UK “unicorns” (i.e. valued at over $1bn). This city is certainly a great ecosystem for any investor to have in their sights!
Labelled the “fastest-growing tech hub in the North” in 2019, Leeds is a thriving tech hub. This may come as a surprise since, historically, it may not be a place you would associate with tech. Yet in that year, Leeds’ digital sector contributed £6.5bn to the economy and employed over 102,000 people. The city boasts one of the highest concentrations of scaleups outside London and features the likes of Sandstone Technology, Fitek and Hudl. Growing businesses such as DAZN Group, Sky and Panintellgience also have a big presence in Leeds. Venture capital investment into the region’s tech businesses stood at £108.8m in 2019 – the fastest rate in the north of England. The city benefits startups in a range of ways including Leeds University as a Big Data research hub, technology hubs and centres (e.g. Digital Hub) and Leeds Innovation Centre (a leading regional science park).
Conclusion & invitation
Above, we have listed just a handful of the UK’s many thriving startup ecosystems. There is much more going on in the cities than we’ve been able to mention here, and we haven’t even talked about other exciting hubs such as those in Newbury, Basingstoke and Reading.
Interested in finding out more about the exciting startup projects we have on offer to investors here at Bure Valley Group? Get in touch today to start a conversation with our team and discuss some of the great investment memorandums we have available here:
+44 160 334 0827