UK government to pump £1.5m into science and tech investment drive

Monday 11 March 2024 6:01 am

The British government is spending £1.5m on a marketing campaign to turbocharge the nation’s science and technology sector, aiming to spark a surge in investment in UK-based tech ventures.

Tech Secretary Michelle Donelan is set to announce the fresh campaign during a techUK conference in London today. The initiative is urging UK investors to back science and technology scale-up businesses, specifically those at Series A-C level and beyond.

The global investment downturn last year dealt a significant blow to UK scale-ups, leaving them scrambling for much-needed support.

While the UK has a burgeoning venture capital community for early-stage projects, many of its growing scale-ups have been seeking greener pastures across the Atlantic, where institutional funds provide better support for their next stage of growth.

“The UK has built a £1 trillion tech sector from a thriving start-up scene, outpacing our European counterparts at every turn and creating innovators capable of shaping the global economy,” said Donelan ahead of her speech.

“With further capital, there is absolutely no limit to where start-ups can take their ideas. But too often, founders look to other parts of the world to find that next level of funding.”

According to the government, a single Series A investment averaging around £2m could match the £1.5m cost of the campaign’s initial round. Similar government initiatives have yielded returns as high as tenfold, and it expects comparable results over three years.

The campaign, with a particular focus on the underfunded deep tech sector, will target venture capital hubs in London, Edinburgh, Belfast, and Cardiff. Its aim is to align venture capitalists with the government’s ambitious agenda of establishing the UK as a science and tech ‘superpower’.

In last week’s Spring Budget announcement, Chancellor Jeremy Hunt proclaimed that the UK is on track to become the world’s next Silicon Valley. 

However, tech leaders were quick to refute this claim, especially as the government opted not to reverse the cuts to the R&D tax credits regime, which startups had been hoping for. Although the recent Spring Budget provided some positives, including doubled AI funding and a £360m R&D package, there is still room for improvement, they argued.

Donelan said: “There has never been a better time to invest in British tech companies – with the UK leading on every key European metric and leading the world on emerging technologies like safe AI.

“Our Science and Tech Superpower campaign all but knocks on the doors of venture capitalists and scale-ups across the country. It asks them to seize the opportunities that lie in front of them so we can take the UK to the next level of tech leadership.”