Tech - Funding and Developments

With London Tech Week having been hosted in June there has been much commentary on the tech sector. This ranges from how equity investment in tech and small businesses is at a record high in the UK to new trends, particularly in light of Facebook’s recent announcement of its proposed 2020 digital currency, Libra.

This month we look at some of the latest articles on the continued development of tech investment, and where significant funds and capital is being raised.

Equity Investment In Small Businesses Hits Record Level – Business Telegraph

Business Telegraph reports that ‘a record £6.7bn in equity investment went to small UK business in 2018’ following the publication of a report by the British Business Bank’s annual Small Business Equity Tracker. The article notes that there has been a particular focus on tech, with Catherine Lewis La Torre, Chief Executive of BBB claiming that the ‘UK was already ahead of the rest of the EU as a tech hub’.

Whilst this news is encouraging, in her opening speech at London Tech Week, Teresa May highlighted the challenge that the UK might face in retaining this position with upcoming Brexit. She highlighted that the Government was offering AI and data masters conversions courses as well as looking to fund scholarships to promote technological progress in the country. At the same time she announced Government plans to provide £153m for quantum technologies with a further £205m pledged to those industries that would be needed to commercialise the technology. Whilst noone knows the impact of what may (or may not come of Brexit, it is good to see that processes are in place to protect Britain’s position in the tech space, though knowing whether this will be enough is another matter.

Entrepreneurs And Investors, It’s Not About Bitcoin: Build Or Invest In Blockchain Solutions – Forbes

Following the burst of Bitcoin’s bubble, Forbes’ Bernhard Schroeder considers why blockchain may be a more valuable investment than Bitcoin, looking at digital rights management, customer reward marketplaces and more. He suggests that ‘Sometimes, it’s not about the product but about the technology. And in this case, that is blockchain.’

As seen with Bitcoin, cryptocurrency is exceptionally difficult to regulate and value, but the concept of Schroeder’s article is interesting.

Facebook Wants To Create A Global Currency – The Economist

Talking of Cryptocurrency, Facebook has announced another attempt at launching its own digital currency in 2020. It claims the Libra will be ‘pegged to a basket of major currencies’ and capable of handling large transaction volumes. Whilst onlookers note that Facebook’s past capabilities in managing users’ personal information may put people off from using it, The Economist observes that should ‘Facebook’s 2.4bn users adopt Libra to shop and transfer money, it could become one of the world’s biggest financial entities’.

$300m And An IPO: What’s Up In Cybersecurity – Crunchbase Daily

Across the water, Crunchbase reports that two cybersecurity companies made waves in the tech and business worlds, both raising large capital. KnowBe4 saw ‘US$300 million in growth equity’ and Crowdstrike ‘officially hit the public markets’ raising US$612 million. Author Savannah Dowling delves into the history of cybersecurity investment over the past few years and where these significant capital raises fit in.

With new technology being developed across AI, cybersecurity, the cloud and mobile, there will continue to be new tech companies coming to market and looking to raise capital to develop further. Whilst the majority of startups are high risk, it is worth maintaining an awareness of current trends, and their potential impact across the broader financial sector.