A recent analysis from the University of Oxford and venture capital firm OpenOcean brings new insights into the funding landscape for AI startups in the UK, highlighting that regions outside of London are increasingly securing higher average funding. This data challenges the longstanding belief that London is the unrivaled center for AI ventures.
From 2012 to 2021, AI startups outside the capital received an average funding amount surpassing that of their London counterparts. In 2023, South West England led the regions with an impressive USD $17.6 million per startup, significantly outpacing North West England, which received only USD $4.7 million per startup. Scotland also showcased remarkable performance, attracting USD $9.0 million per startup.
While London’s total funding was substantial, it ranked fourth in average funding per startup last year with USD $12.8 million. Other regions like the South East and East of England also reported high averages, at USD $14.7 million and USD $15.5 million respectively. This indicates a shifting landscape where regions traditionally viewed as secondary are rising in prominence.
The analysis also reveals a dramatic increase in the number of AI startups in the UK, with the figure soaring over eightfold since 2012. The pandemic has also influenced this sector, altering growth rates and making clear the necessity for further investment in AI across the nation.
As stated by Ekaterina Almasque, General Partner at OpenOcean, for the UK to maintain its competitive edge in AI, comprehensive support across all regions is critical. The data underscores a pressing need to foster innovation and investment beyond London, paving the way for a more balanced AI ecosystem that can truly thrive.
