London’s technology sector has achieved a remarkable milestone, with startups in the capital securing a record £2.5 billion in funding during the first quarter of 2026, according to new data from Tech Nation.

Key Investment Highlights

The funding surge was led by artificial intelligence and fintech companies, with several British startups achieving unicorn status. Notable deals included a £500 million Series D round for AI healthcare company DeepMind Health and a £300 million investment in digital banking platform Revolut’s expansion plans.

Chancellor of the Exchequer announced new tax incentives for tech investors, stating: “The UK is cementing its position as Europe’s leading tech hub. These investments will create thousands of high-skilled jobs across the country.”

Regional Growth

While London dominated the funding landscape, Manchester and Edinburgh also saw significant investment activity. The Northern Powerhouse initiative has attracted several major tech companies to establish offices in Birmingham and Leeds.

Impact on the Economy

The Bank of England noted that the tech sector now accounts for 10% of UK GDP, with exports of digital services reaching £80 billion annually. The FTSE 100 tech index has risen 15% since January.

Looking Ahead

Industry analysts predict continued growth throughout 2026, with particular interest in quantum computing, green technology, and cybersecurity startups. The government’s commitment to 5G infrastructure and digital skills training is expected to further boost the sector.

Source: Reuters | Read original