UK tech companies continued to outshine their European counterparts this year when it came to value and investment levels, though both have fallen in the face of economic headwinds as the pandemic-fueled boom ground to a halt.
In total, UK tech companies saw investment fall from $36bn in 2021 to $27.9bn in 2022, about three times the level of the second-biggest recipient, Germany, at $10.8k. millions. London continued to be the most attractive European center for capital, with $19.2 billion in funding, followed by Paris with $9.9 billion.
Last year saw a surge in investment in Europe’s tech industry, with a record deployment of $100 billion, a number expected to fall to $85 billion by 2022 as confidence in the sector cools. . Despite the recession, this is more than double the amount raised in 2020 of $38.8 billion, which according to the analysis showed how far the European tech ecosystem had developed.
The annual report on the state of European technology compiled by Atomico, the venture capital firm, laid bare the impact of the recession on the sector as valuations plunged and job cuts mounted. The research has analyzed the health of the ecosystem of both public and private technology companies in the region since 2015.
He described 2022 as a “year of two halves” because there were dizzying levels of investment in tech companies earlier in the year, a continuation of the pandemic-fueled “frenzy” of 2021, but from July this began to fade as sponsors they became more cautious. Investors have record capital funds; it’s just distributed more cautiously: $84 billion was available at the end of 2021, the latest period for which data was provided.
Overall, the market value of European tech companies, including the UK, fell by $400 billion in 2022, from $3.1 trillion to $2.7 trillion.
The UK and Ireland continue to be home to the largest number of unicorns, with 118 companies valued at more than $1 billion each, followed by Germany, Austria and Switzerland, which together have 77 companies.
The number of people who lost their jobs “rised rapidly” in the past month. Overall this year, 14,000 technology employees were laid off in Europe, 7 percent of the global total.