Investment in Northern tech companies has reached a ten-year high, as investors worldwide target the region’s fast-growing digital sector, according to Livingbridge.
The private equity firm’s research, conducted in partnership with Experian Corpfin, revealed that 206 deals involving Northern tech companies were completed in 2018, almost double the number seen in 2009, following the UK-wide recession, and 10 per cent more than in 2017. The growth in investment represents the third year-on-year rise in the number of tech deals completed across the North.
The overall value of tech investment in 2018 also soared, with more than £2.3bn completed in 2018, up 77 per cent on the value of deals in 2017.
One of the biggest deals seen across the region was the £235m investor buyout of Chorley-based ParkingEye Ltd from Capita Plc. ParkingEye’s car park management system uses automatic number plate recognition software to help supermarkets ensure their spaces are available for customers. Other landmark deals included the £40m fundraise by Cheshire-based Blue Prism Group, the provider of automation software, through a primary placing of new shares.
In the last decade, a total of 1,585 deals were completed, with £22bn invested in tech businesses across the North of the UK.
Over this period, investors worldwide have been particularly attracted to tech-enabled communication providers, with computer programming and publishing the most heavily-invested subsectors. Electronic manufacturing businesses and telecommunications companies have also proved strong growth areas.
Matthew Jacobs at Livingbridge, said: “With an exceptional talent pool, the North West has forged a reputation as a global powerhouse for digital investment. Businesses across the region are continually trailblazing in their respective fields, producing cutting-edge tech solutions and snapping up gaps in the market with new innovation.
“With MediaCityUK and a raft of large-scale ecommerce headquarters such as AO.com and Boohoo, the North West is a hub for creative, digital and ecommerce tech. A particular point of difference for the region is Manchester’s ‘Data City’, a data science and software company which uses open data, online figures and artificial intelligence to comprehensively map the region’s emerging tech capabilities, the only one of its kind in the UK.
“Last year we saw a rise in investment across the sector, from fintech to computer manufacturing, and it is interesting to see a large number of deals backed by overseas investors, with the US a particularly prominent player. With such a degree of agility and world-class entrepreneurship in the North, there is great investor appetite for businesses looking to scale.”