Welcome to Tech Nation 2017, the most comprehensive analysis of the UK Digital Tech Ecosystem. At Tech City UK, we believe great tech companies are built from strong ecosystems. Our mission is to help nurture them.
The Rt Hon Theresa May, MP The Prime Minister
Today more than 1.5 million people are already working within the digital sector, or in digital tech roles across other sectors, while the number of digital tech jobs across the UK has grown at more than twice the rate of non-digital tech sectors. From analysts to web developers to software architects, these pioneers of our digital economy are at the forefront of a great British success story.
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Eileen Burbidge, Chair Tech City UK
Gerard Grech, CEO Tech City UK
Welcome to Tech Nation 2017, a journey across the UK’s digital landscape that provides a data-rich analysis of Britain’s thriving digital economy and clusters.
In this, our third annual report, we shine the spotlight on the UK’s digital tech economy. We highlight innovation in every corner of the UK, from Bristol to Edinburgh, with over 60 company case studies. London continues to be an international digital powerhouse and its ripples are increasingly spreading throughout the nation.
Read MoreTo produce this report we analysed more than 1,000 data points, over 2,700 survey responses from digital tech founders and employees and incorporated insights from over 220 community partners across the UK.
The findings are clear – when it comes to digital tech investment, talent and skills and digital collaboration the UK is a leader within Europe and on the international stage.
In 2016 the UK secured £6.8 billion in venture capital and private equity investment, that’s over 50% more than any other European country. Over the past five years London has attracted more investment than Paris, Berlin and Amsterdam combined.
| Country | Digital Tech Investment £bn (2016) |
| UK | 6.8bn |
| France | 2.4bn |
| Germany | 1.4bn |
| Netherlands | 1.3bn |
| Denmark | 1.0bn |
| Italy | 0.8bn |
| Spain | 0.8bn |
Source: Pitchbook, Tech City UK, 2016
| Country | Number of universities in top 20 |
| United Kingdom | 8 |
| Germany | 4 |
| Netherlands | 3 |
| Switzerland | 2 |
| Sweden | 1 |
| Belgium | 1 |
| France | 1 |
Source: Times Higher Education World Varsity Rankings, 2016-17
In 2016 London hosted 22,000 tech related Meetup events – nearly three times as many as Berlin, Amsterdam or Paris. Interpersonal networking is critical to the UK’s success and the face-to-face networking that these Meetups enable is hugely important to the growth and success of digital businesses.
| City | Number of Tech Meetups (2016) |
| London | 21866 |
| Berlin | 7963 |
| Amsterdam | 7915 |
| Paris | 7581 |
| Oslo | 3490 |
| Zurich | 3373 |
| Barcelona | 3286 |
| Madrid | 3225 |
| Munich | 3012 |
Source: Meetup, 2016
The turnover of the UK digital tech industries was estimated at £170 billion in 2015. This is a growth rate of 22% (or £30 billion) in five years. Over the same period, the total number of UK digital tech businesses grew by 28%, more than twice as fast as non-digital businesses. In London, a new tech business is formed every hour.
| Year | Digital Business growth | Non Digital Business growth |
| 2011 | 100% | 100% |
| 2012 | 103% | 101% |
| 2013 | 112% | 105% |
| 2014 | 119% | 109% |
| 2015 | 128% | 113% |
Source: BSD, Tech City UK, 2015
| Year | Number of Digital Tech Jobs (Millions) |
| 2014 | 1.56mm |
| 2015 | 1.64mm |
Source: BSD, Tech City UK, 2015
| Year | % of Digital Tech Investment in UK clusters (excl London) |
| 2012 | 74% |
| 2013 | 34% |
| 2014 | 44% |
| 2015 | 40% |
| 2016 | 68% |
Source: Pitchbook, Tech City UK, 2016
Nearly 70% (68%) of total UK digital tech investment in 2016 was in regional clusters beyond London. Tech businesses in these clusters raised more than £4.6 billion in funding. Six clusters alone attracted nearly £700 million investment between them in 2016: Edinburgh (£159 million) Cambridge (£153 million), Bristol & Bath (£109 million), Oxford (£106 million), Manchester (£78 million), and Sheffield (£61 million).
Digital tech workers are helping to boost the wider UK economy through higher productivity levels per worker. The GVA of a digital tech worker is now 2X higher than a non-digital worker, (£103,000 compared to £50,000). This productivity gap has grown from £48,000 to £53,000 over the last five years – further evidence of the significant value that the digital tech sector is adding to the broader UK economy.
| Non Digital GVA per worker (£k) | Digital GVA per worker (£k) | |
| 2011 | 44 | 92 |
| 2012 | 45 | 92 |
| 2013 | 46 | 93 |
| 2014 | 49 | 97 |
| 2015 | 50 | 103 |
Source: ONS Annual Business Survey/ONS Business Structures Database
