Climate Insider Brief:
- In 2023, London-based climate tech startups secured an impressive $3.5 billion in funding, marking the second-highest globally, ahead of the renowned San Francisco Bay Area but trailing slightly behind Stockholm.
- Notably, the climate tech sector experienced a remarkable 59% year-over-year increase.
- There have been significant contributions from startups including Zenobe Energy, Octopus Electric Vehicles, and TopHat.
PRESS RELEASE – January 18, 2024 – London-based climate tech startups raised $3.5bn (£2.75bn) of funding in 2023, the second-highest globally and ahead of the San Francisco Bay Area.
London was beaten only by Stockholm for climate tech funding, with startups based in the Swedish capital city securing $3.6bn.
Startups in the Bay Area raised $2.7bn, followed by Boston at $2.4bn.
The data from London & Partners and Dealroom show that across all subsectors London startups collectively raised over $12.9bn in venture capital funding.
The UK has typically ranked third for tech funding globally, behind only the US and China.
The figures show that London’s climate tech sector is a key growth area. It marks a 59% year-over-year increase for climate tech funding, up from $2.2bn in 2022.
Across all tech subsectors, London ranks fourth globally – raising $12.9bn in 2023.
This means nearly 61% of UK venture capital funding went to London-based startups in 2023.
The biggest London climate tech funding rounds from last year are the £870m raised by Zenobe Energy, £150m by Octopus Electric Vehicles and the £70m raised by TopHat.
“London has established itself as one of the global leaders for climate tech. We have fantastic London-based climate innovation, green tech businesses flocking to London from all over the world, and big VC funding for the sector,” said Laura Citron, CEO of London & Partners.
“As VC levels begin to return to pre-pandemic levels, our job is clear: keep building on this momentum to make London an even better ecosystem for startups and small businesses to succeed.”
Separate research has shown that climate tech was the leading subsector for tech startup funding across the whole UK last year.
The data, from HSBC Innovation Banking and Dealroom, shows that UK climate tech firms raised an all-time high of $6.2bn, accounting for 29% of total VC investments across the country and beating the much-hyped area of AI.
“In difficult economic circumstances, the London tech sector has once again shown its resilience and attractiveness as a home for ambitious companies looking to solve the big issues of our time,” said Russ Shaw, founder, Tech London Advocates & Global Tech Advocates.
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SOURCE: UK Tech News
