UK sees huge increase in new tech companies, but London falls behind

Old Street roundabout, the heart of London's tech industry (Google street view)
Old Street roundabout, the heart of London's tech industry (Google street view)

2022 saw a huge increase in the number of new tech companies registered in the UK, although the rate of increase in London was lower than most other parts of England.

According to data from Companies House, the number of newly incorporated tech companies across the UK rose from 38,240 in 2021 to 46,474 in 2022, a 22 per cent increase.

London accounted for more than half of this figure, with 24,783 incorporations in 2022. This marked a 21 per cent increase over the 2021 number, 10,552.

While the London increase is just one per cent below the UK-wide average of 22 per cent, other areas in England saw a much more substantial rise. The East Midlands saw the highest relative increase, with a 38 per cent jump in tech company incorporations from 2021 to 2022.

The South East of England was the only part of England with a lower percentage increase than London. At just 10 per cent, the South East saw the slowest increase throughout the UK.

This data was compiled by consulting firm RSM UK, using information from Companies House.

“Whilst it is no surprise to see London at the centre of new tech incorporations, growth across all regions outside the capital is further evidence of the UK’s thriving tech industry,” said RSM senior analyst Ben Bilsland.

“There is clearly appetite from entrepreneurs to start up new, innovative businesses and become part of the UK’s booming tech industry.

“This crop of early-stage businesses will need support to scale. Access to funding will be crucial and the UK Government will need to ensure that UK tech is an attractive place for both domestic and overseas investment.”

At the tail end of January, Old Street-based tech incubator Tech Nation announced the Government had decided not to renew its DCMS funding. The programme will wind down on March 31, potentially taking some of the momentum out of London’s “Tech City”, in which it is based. Tech Nation is a vetting body that works with individuals who want to come to the UK over its Global Talent visa programme.