London, Mumbai and Bangalore have featured among the world’s top startup hubs, according to a comprehensive ranking of international startup hubs compiled by Startup Genome for its annual Global Startup Ecosystem Report 2021. Despite Brexit and the coronavirus pandemic, London maintained its second-place ranking tied with New York for the second year in a row.
Bangalore also ranked in the top 30 global tech hubs (#23 globally) and Delhi made it into the top 40 list, coming in at 36th. Mumbai maintained its first position in the Emerging Ecosystems ranking (ecosystems in earlier stages of growth that have high potential to be global performers in the future), outperforming other fast-growing ecosystems in areas of funding, performance, market research and talent.
Released to coincide with London Tech Week, the largest tech event in Europe, the report ranks the leading 140 startup ecosystems based on seven success factors including Performance, Talent and Connectedness.
The findings revealed that London is the most attractive destination to set up a tech startup outside of Silicon Valley, with an overall ecosystem value of $142.7bn. London has risen up the league table in the last few years, climbing from number eight in 2012 when the first rankings were released to number two in 2020.
Silicon Valley held onto the top spot this year while Beijing and Boston came in fourth and fifth respectively.
The research shows that Indian startups raised $12.1 billion in the first half of this year, demonstrating the rapid growth of India as a global hub for tech and innovation. As of August 2021, India has produced 24 unicorns in 2021, including 6 in just 4 days in April.
The city of Bengaluru and the surrounding state of Karnataka is also the world’s 4th largest technology and innovation cluster and home to more than 400+ global R&D centres. Alongside Mumbai, a number of other Indian hubs made it into the ‘Top 100 Emerging Ecosystems’ list, including Chennai, Pune and Hyderabad.
The findings also revealed London is one of the best cities in the world for access to funding and quality and activity in the investment ecosystem (referring to the number of local investors, investor experience and their level of activity). London has already seen record levels of VC tech investment this year, with the UK capital’s tech startups receiving $13.3bn in the first seven months (January to July), more than the $10.9bn raised in the whole of 2020.
London’s impressive start to 2021 has been boosted by major funding rounds for Revolut ($800m), Checkout.com ($450m) and Hopin ($400m). Bangalore’s ranking was also boosted by healthy access to growth capital, demonstrated by recent large funding rounds from food delivery platform Swiggy ($1.3bn), social media company ShareChat ($502m) and edtech firm Byju ($460m).
Compared with other international tech hubs, the research found that startups in London have access to deeper pools of capital, with an average seed round of $653k, ahead of the global average of $494k. London is currently home to over 1,370 VC firms – more than any other European city, providing access to a vast network of investors and a depth of capital in the ecosystem. A number of global investment firms have also increased their presence in London recently, with Index Ventures announcing a $3.1bn fund for European start-ups in July and the news that Silicon Valley based VC Sequoia Capital had expanded its footprint in the UK capital.
London is also recognised for its world class talent pool, with the city ranking highly across the board for quality and access to Tech and Life Sciences talent. With four of the world’s top ten universities located in or close to London, the city is home to 484k software developers as well as a high number of Life Sciences-focused universities and degree programmes.
The Mayor of London, Sadiq Khan said, “London is a fantastic place to grow and scale a global tech business. We celebrate the diverse, international nature of our tech ecosystem and it is great to see our thriving start-up community being recognised in this report.
London’s tech sector has a pivotal role to play as we rebuild from the pandemic, and I am excited to be part of London Tech Week to discuss how our tech community can work with other start-up hubs to solve global challenges. In the face of Brexit and the global pandemic, London has demonstrated its resilience and proven itself once again to be one of the best places globally for tech innovations and start-ups.”
Janet Coyle, Managing Director Business Growth, London & Partners said, “India and London have shared strengths in technology, innovation and entrepreneurship and today’s report findings demonstrate the abundance of opportunities for Indian tech companies looking to London for international expansion.
For startups and high growth companies considering global expansion, London has access to high levels of funding, talent and customers all in one city. As one of the world’s leading hub for innovation, there is huge opportunity for London to collaborate with other fast-growing startup hubs like Bangalore and Mumbai.”
JF Gauthier, Founder & CEO of Startup Genome said, “Entrepreneurs, policymakers, and community leaders in Asia have been working hard to build inclusive innovation ecosystems that are engines of economic growth and job creation for all. The Global Startup Ecosystem Report is the foundation of knowledge where we, as a global network, come together to identify what policies actually produce economic impact and in what context.”
While the US and China have long been considered the global superpowers for startups and tech, the pandemic has accelerated the democratisation of startups, and Europe is quickly cementing its position on the global stage.
The report shows Europe accounts for 17% of the top 30 ecosystems this year, with London the only European city to make the top 10 list. Asian ecosystems also continue to rise in the rankings, with Tokyo (from #15 to #9), Seoul (#20 to #16), Shenzhen (#22 to #19), Bengaluru (#26 to #23), and Hangzhou (#28 to #25) moving ahead.
Poppy Gustafsson, Founder and CEO at Darktrace, said, “At Darktrace, we are proud to be building on the UK’s rich heritage in tech and innovation. Being part of the UK’s tech ecosystem affords us access to a vast network of investors, researchers and talent and has been instrumental in building a successful AI business and – in particular – advancing our leading position in Self-Learning AI.
I’m thrilled to be an ambassador for London Tech Week, a fantastic opportunity not only to celebrate the UK’s achievements thus far, but to drive our industry forward.”
The release of the latest Global Startup Ecosystem Report coincides with London Tech Week, bringing together the global tech community to address how tech can solve some of the world’s most pressing challenges. Key speakers throughout the week include Hilary Clinton, former US Secretary of State, Sebastian Siemiatkowski, Co-founder & CEO at Klarna, Alex Mahon, CEO at Channel 4 and Maria Raga, Founder & CEO at Depop.
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