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Asian venture capital piles into UK fintech investment

Data compiled for the UK’s Department of Digital, Culture, Media and Sport shows investment into UK tech from the middle east and Asia region is booming.

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The UK tech ecosystem is attracting record levels of venture capital money from Asian and Middle Eastern investors, with fintech leading the charge. 

The three most attractive sectors for Eastern capital are fintech, software enterprise and health. In 2020 alone, Asian investors were involved in 28 fintech deals, 18 software enterprise deals and in 17 health tech deals.

The five biggest Asian investors in the UK in 2020 were SoftBank, GIC, DST Global, Temasek and Tencent. Japan’s SoftBank remains the leading Asian investor in UK tech, but is joined by GIC (Singapore), DST Global (Hong Kong), Temasek (Singapore), and Tencent (China). 

Meanwhile, the likes of theQatar Investment Authority, were involved in UK mega-rounds including Starling Bank and Tandem.

Tech startups received almost twice the amount of capital from Asia and the Middle East in the first six months of 2021 compared with the whole of 2020, according to data from compiled for the  UK’s Department of Digital, Culture, Media and Sport’s

Asian investment in the UK has already exceeded £1.7bn in 2021 (£1bn in whole of 2020)

Matt Warman,  Minister for Digital Infrastructure, said: “The UK tech sector is home to the most innovative, most exciting and most globally scalable startups in the world, so it’s no surprise Asian investors are recognising just what a wealth of talent we have here. It’s also a huge compliment to have a region that has been at the forefront of tech and innovation for decades to believe so strongly in what we’ve built here in the UK and to want to be a part of that.” 

Overall venture capital investment in the UK has reached £12.3bn in the first half of 2021, compared to £10.8bn for the whole of 2020. 

Julia Hawkins, general partner at LocalGlobe said: “The UK’s tech sector is thriving like never before and attracting the attention of forward-thinking Asian investors, in particular those long-term investors of sovereign wealth funds and pension funds. If the benefits of the immense increase in value in tech are to be shared across UK society, our own long-term investors, pension funds and institutions need to wake up to the future economic powerhouses being built on their doorstep.”

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