Tech companies based in the North of England saw a record increase in investment in 2016, with startups in the region increasingly looking to venture capital firms for expansion.
A total of £326.9 million was invested into Northern tech firms in 2016, according to the first Tech North Investment Index report. This was an increase of 1,551 percent from the £19.8 million raised in 2007, with the most significant growth taking place over the previous three years.
According to the report, the North West region led in terms of number of deals recorded over the 10-year period, at 48 percent, followed by the North East at 28 percent. Yorkshire and the Humber came in third place, accounting for 24 percent of transactions.
Some of the biggest deals over the past ten years have included Atom Bank, the challenger bank based in Durham, TheHut.com and Chess. Alasdair Greg, of Newcastle-based venture capital firm Northstar Ventures, says there has been a shift in ambition in the North of England:
“Not only have we seen a significant increase in demand for venture capital from regional entrepreneurs, but more importantly there has been a rise in the quality and level of ambition of the businesses being built here.
“Founders now know that they don’t need to relocate their businesses to the US or London in order to access finance and support from experienced investors, or attract the scale-up talent they need to grow,” Greg said.
The biggest jump in capital invested from one year to the next was seen in 2014, when the figure increased from £23.7 million in 2013, to £169.6 million in 2014. 2015 was the strongest year for deals, with the North racking up 93 during the year.