Investment in UK growth-stage tech companies fell by 3pc in 2018 after stellar 76pc growth between 2016 and 2017, according to new research. Investment in France and Germany continued apace last year, with growth of 27pc and 26pc respectively.
In 2018, just under €3.4bn went into growth rounds for UK tech startups, compared with €2.4bn in France and €2bn in Germany.
However, the UK is still a step ahead of its European peers with €8.82bn invested in growth-stage tech between 2016 and 2018 overall, says a report by payments platform Stripe and Tech.eu. This compares with €5.54bn for France and €4.85bn in Germany.
The UK’s main strength was in fintech, with the country accounting for almost half (€2.36bn) of total European investment in the sector (€5.4bn).
Total investment in European growth start-ups over this period was €30bn with more than 2,300 funding rounds. Total financing going to British, German, French and Swedish growth startups between 2016 and 2018 exceeded €21bn, accounting for 70pc of the total. Investment in growth startups and the number of funding deals have roughly doubled in Europe over the last three full years, according to the Life is Growth report.
Overall, more thatn 2,000 startups have reached growth stage, with a median size of investment round of €10m.
Preliminary data for the first quarter of 2019 shows the positive trend continuing: total investment for growth-stage tech companies in Europe reached an estimated €3.7bn, 14pc higher than the €3.25bn recorded for Q4 2018.
Fintech is the top vertical in the UK, Germany and Sweden, while medtech is by far the top vertical in France. Software-as-a-service (Saas) is a strong third in most European countries.
Robin Wauters, founding editor of Tech.eu, said: “What is showcases is that there’s an ongoing maturation process in place, particularly in key hubs and business categories, which bodes well for the future of European tech.”