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While the narrative of UK tech firms fleeing to the United States makes for compelling headlines, the data tells a fundamentally different story. Rather than witnessing a wholesale exodus, we're seeing a maturing ecosystem where companies are increasingly choosing to stay and scale within the UK's borders. The Prime Minister's bullish tone at London Tech Week wasn't mere political rhetoric—it reflected a sector that has achieved remarkable scale and shows every sign of continuing to thrive domestically.
The UK tech sector has reached a combined market valuation of £1.2 trillion as of 2024, representing a striking 20% increase from the previous year. This figure represents a ninefold amplification over the past decade, firmly establishing the UK as Europe's dominant tech ecosystem. Far from being a sector in decline, UK startups raised a formidable £16.2 billion in 2024 alone—nearly doubling the capital raised by their counterparts in Germany and France combined.
The employment story is equally compelling. UK tech companies now employ over 1.8 million people globally, doubling the figure from just four years ago. This isn't simply about keeping existing businesses afloat; it's about genuine expansion. The sector experienced a 37% total revenue increase in 2023 in areas like safety tech, with some subsectors on track to hit £1 billion in annual revenues by 2025/26.
Perhaps most tellingly, new UK technology incorporations reached a five-year high in Q1 2024, with 13,802 new companies formed—an 11% increase from the previous year. This surge in entrepreneurial activity suggests that the UK remains an attractive place to start, not just continue, a tech business.
Behind these statistics lie real companies making real decisions to scale domestically. The UK minted nine new unicorns in 2024, bringing the total to 181 startups valued at over £1 billion. This means the UK is now home to almost a third of all European unicorns—a remarkable concentration of high-value companies that have chosen to maintain their primary operations domestically.
Companies like Wayve, which raised £1.1 billion in autonomous driving funding, and Monzo, which secured £448 million and £190 million in separate rounds, demonstrate that UK firms can access substantial capital without relocating. The fintech sector alone attracted £3.9 billion in venture capital investment in 2024, retaking the top spot from climate tech and highlighting the continued strength of London as a global financial technology hub.
Even more compelling are the stories of companies actively choosing to expand within the UK rather than relocate abroad. Texthelp, the Northern Ireland-based company developing assistive technology, has grown from £8.8 million turnover in 2021 to £19.8 million in 2022 while maintaining its UK base and building partnerships with major domestic companies like Tesco and Virgin Media. Similarly, companies like Dexory raised £19 million in Series A funding to scale their robotics operations between London and Oxfordshire, demonstrating that significant growth capital is available for companies willing to scale domestically.
One crucial factor supporting domestic scaling is the UK's increasingly sophisticated tech infrastructure. The government has designated data centres as critical national infrastructure and announced over £25 billion of investment in UK data centres since taking office. This includes commitments from major players like Amazon Web Services, CyrusOne, and ServiceNow, creating the foundational capacity needed for AI and data-intensive companies to scale domestically.
Nvidia's commitment to deploy 10,000 Blackwell GPUs in the UK by the end of 2026 through Nscale represents a vote of confidence in the UK's ability to support cutting-edge AI development. Analysis by Public First shows that regions with more AI and data centre infrastructure consistently demonstrate stronger economic growth, with even modest increases in capacity potentially adding £5 billion to national economic output.
The UK's tech talent ecosystem has reached a critical mass that makes domestic scaling increasingly attractive. London accounted for 7,253 new tech incorporations in Q1 2024, up 16% from the previous year, cementing its position as a global tech hub. But the story extends far beyond the capital. Manchester has become home to six tech unicorns and represents one of the top startup hubs in the UK, while the Thames Valley region has contributed £10 billion to the British technology economy and houses over 8,000 digital companies.
The diversity of these regional hubs means companies can access different talent pools and cost structures without leaving the UK. Bristol's tech ecosystem spans from machine learning to aerospace, housing companies like Immersive Labs, which has raised over £150 million in investment funds. Meanwhile, Birmingham's new £4.5 million tech hub project and the Cross-UK Innovation Cluster linking Manchester and Cambridge universities demonstrate the expanding infrastructure for tech collaboration.
Rather than the policy headwinds often cited in departure stories, the current government is implementing substantial support measures that create competitive advantages for companies scaling domestically. The Made Smarter Adoption programme funding has doubled to £16 million in 2025-26, specifically supporting small manufacturing businesses to adopt advanced digital technologies. Core R&D budgets have been protected with real-terms increases for health and life sciences research.
The forthcoming AI Action Plan, supported by £25 billion in infrastructure investment and new regulatory frameworks designed to be pro-innovation, positions the UK as a leader in responsible AI development. The establishment of a permanent Commercialisation of Tech Taskforce provides dedicated support for emerging technologies transitioning from research to market—precisely the kind of scaling support that keeps companies domestic.
UK-based venture capital firms raised £11.3 billion in dry powder in 2024, representing a 59% increase from the previous year. This substantial war chest signals strong future investment capacity and reduces the pressure on companies to seek overseas funding. Significantly, 68% of funding rounds now involve international investors, meaning UK companies can access global capital while maintaining their domestic base.
The concentration of venture capital in breakout funding stages is particularly relevant for scaling companies. Series B and C rounds alone attracted over £6.5 billion in 2024, providing exactly the kind of growth capital that enables companies to scale domestically rather than relocate for funding. With half of the UK's enterprise value concentrated in pre-exit companies, there's substantial potential for domestic exits and acquisitions that keep successful companies within the UK ecosystem.
The UK's tech sector has developed deep specialisation in areas where it enjoys genuine competitive advantages. AI-focused venture-backed businesses raised £4.2 billion in 2024, a 31% increase from the previous year, representing 27% of all venture capital raised nationally. The UK leads Europe with over 1,800 VC-backed AI startups and 20 AI unicorns, building on research strengths from institutions like Oxford and Cambridge.
In fintech, the UK's regulatory environment and financial services expertise create natural advantages that are difficult to replicate elsewhere. The sector's dominance in areas like autonomous vehicles (Wayve), drug discovery (Basecamp Research), and climate risk management (JBA Risk Management) reflects deep domain expertise that benefits from proximity to relevant industries and research institutions.
While some high-profile companies have chosen overseas listings, the UK is also seeing success stories that demonstrate domestic exit opportunities. Raspberry Pi's successful listing on the London Stock Exchange in 2024 provided a high-profile example of a tech company choosing to remain and list domestically. The reforms to the UK's Financial Conduct Authority listing regime are creating more attractive conditions for companies to list domestically.
More importantly, the concentration of private equity and venture capital means that many successful companies are finding exit opportunities through acquisitions by domestic or international buyers without needing to relocate. The maturation of the UK's own acquirer base, combined with the presence of international companies with significant UK operations, creates a robust market for company exits.
The trends point toward continued domestic scaling rather than flight. The UK's tech sector has achieved the scale and sophistication needed to support companies through their entire growth journey. With 171 unicorns, a trillion-pound valuation, and employment of 1.8 million people, the ecosystem has reached a critical mass where network effects and clustering benefits become increasingly important.
The government's focus on AI infrastructure, digital skills development, and regulatory reform creates a supportive environment for continued growth. The establishment of regional tech hubs, university partnerships, and international collaborations provides companies with domestic scaling opportunities that didn't exist a decade ago.
Rather than viewing the occasional high-profile departure as evidence of systemic problems, the data suggests these are exceptions to a broader trend of domestic success. For every Wise shifting its primary listing to the US, there are dozens of companies like Monzo, Wayve, and the hundreds of newly formed startups choosing to build their futures within the UK's increasingly sophisticated tech ecosystem.
The UK's tech sector isn't just surviving—it's thriving domestically and positioning itself for continued growth. The foundations are in place, the capital is available, and the talent is here. For companies willing to scale within the UK's borders, the opportunities have never been better.
