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London Tech Week: Britain is 'truly world class' in fintech. Long may it continue

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As entrepreneurs and investors arrive in the capital for London Tech Week, there’s never been a better time to recognise the achievements of the UK’s tech industry.

When I meet some of the entrepreneurs at this week’s events I will be talking to people who have risked everything to create something new, often helping to resolve fundamental problems.

It takes daring, intelligence, supreme organisational skills and persistence to launch a tech startup. But the growing success story in the UK is our scaling up of businesses. Increasingly, the UK’s ambitious entrepreneurs are turning their ideas into global businesses. Once our best minds went to Silicon Valley to make it big in tech, now there’s no need.

Last week Tech Nation and Dealroom launched a new Data Commons for UK Tech, an innovative national database designed to freely share the type of information investors and entrepreneurs need to facilitate growth.

Figures out today from the two organisations for the Government’s Digital Economy Council will reveal the UK has created 13 new unicorns - the name given to fast growing companies worth at least a $1bn - since last year’s Tech Week. Only the US and China, with their vastly different markets and resources, have produced more.

WATCH: London Tech Week 2019

When it comes to fintech, we’re truly world class. We have now produced 21 fintech unicorns, putting us ahead of thriving tech centres like Shanghai, Beijing and New York. Only the Bay Area, in its entirety, can claim more.

Since 1990 the UK has produced 72 unicorns, accounting for a third of all those started in Europe and Israel. And the rate at which we produce these promising companies has increased sharply over the last five years.

London itself is the acknowledged centre of Europe’s tech sector, producing one in five of the continent’s fast-growing unicorns with a value of £118bn ($148bn).

Success breeds success in this industry and the increasing rate at which UK companies have been attracting venture capital investment has been significant in the creation of so many fast-growing companies. From 2013 to 2018, the UK received £28bn ($35bn) of venture capital investment in tech.

All the signs are that 2019 will be another great year, with British companies having received £3.8bn ($4.8bn) in funding between January and the end of May, a record first half due to a clutch of notable funding deals at the likes of food delivery firm Deliveroo, fintech Greensill and small business lender OakNorth.

Looking further ahead, the Tech Nation and Dealroom figures suggest 75 further companies are on a path to becoming unicorns - twice as many as France, Israel or Germany.

Rapid growth like this ultimately leads to successful British companies either floating or being bought by bigger companies. Last year, the UK had 14 successful tech exits worth more than $1bn, compared with 13 across the whole of the rest of Europe.

This extraordinary acceleration of the UK’s tech sector has happened for many reasons. We have four of the world’s top 10 universities and produce more than 5,000 STEM PhDs each year. We have world-class expertise in Artificial Intelligence and deep tech, as well as advanced robotics, advanced manufacturing and automotive experts.

The Government has devised supportive policy and regulation, while there is also a rapidly growing pool of experienced entrepreneurs turned investors from past successes like Skype, Zoopla and JustEat.

But it is the way that our tech sector is developing which makes me most proud. Our aim is for responsible, sustainable growth. This is not only in the interests of the consumer but also in the interests of the tech companies we build, because it will allow them to have a long-term future.

We are determined tech companies will play by rules which are fit for purpose, relevant to the modern economy and fair to everyday consumers.

Appropriate regulation is the key to responsible growth and early on we set a lead with initiatives like the Financial Conduct Authority’s regulatory sandbox, which has now been copied by 20 countries around the world, allowing innovative new companies to experiment safely before they bring new fintech services to the market.

We have also established the Centre for Data Ethics and Innovation which will help us to maximise the benefits of data-enabled technologies. And we have recognised the need to consider the social implications of new technology, with our online harms white paper that will make sure tech companies act on their duty of care to their customers.

This country’s academic excellence and deep tech knowledge will help us tackle some of the greatest social challenges of our time - from protecting our environment and reducing carbon emissions, to transforming the way we travel, supporting our ageing population and saving lives through diagnosing diseases earlier.

British-born unicorn Skyscanner has revolutionised booking holidays while CityMapper, which is helping speed up people’s commutes, is now in 39 cities globally.  OnCare is using technology to make the provision of social care easier so carers can spend more time with clients. Gather Hub, on the other hand, brings people and location data together to improve sanitation and by 2025 aims to transform people’s standard of living for five million people in four cities across the world.

There are already more than 2.1 million people employed in this growing sector, helping spread wealth and prosperity. But it is vital that the opportunities are attainable to all - the school pupil from Runcorn or career changer from Rugby - and we want to create a country that works for everyone and through our modern Industrial Strategy create jobs and growth across the whole country.

So, alongside bringing in new technical qualifications, we are investing £84m in a world leading new centre for Computing Education for Schools, led by some of the UK’s leading tech experts, to give teachers the subject knowledge and support they need to teach the next generation of talent.

We are also investing millions of pounds to give digital skills training to career changers and underrepresented groups through our Digital Skills Innovation Fund.

London is a world-leader in tech and its success is now being replicated in our other major cities. We now have six cities which have produced at least two unicorns - surpassing many of Europe’s capitals.

A new report next week will reveal the strongest growth in jobs has actually been outside London in the dynamic tech clusters springing up in Manchester, Belfast, Birmingham, Reading and Leeds.

Next week will be a fitting tribute to what has been achieved in the capital. But it is also a chance to celebrate the whole UK tech industry and a reminder we must champion an inclusive sector in every corner of the country.

If we do so, the next decade of this nation’s tech revolution will be even more exciting than the last.