Europe leading the way for impact-focussed investment

  • European startups are more impact-focussed than their global peers
  • The UK has had a surge in impact investing, with a 9.5x increase between 2014 and 2019

These latest findings come from new research published by Dealroom and Tech Nation, supported by ImpactCity and Danske Bank.

Impact investments are investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return. With an increased global awareness around climate change, and high inequalities amongst societies across the world, it isn’t particularly surprising that impact investing has become more of a priority for investors in the past 10 years. And it’s encouraging that Europe is at the forefront of change.

The research shows that impact investing accounts for over 15 per cent of total European venture capital (VC) investment; a 3x increase when compared to a decade ago, and more than double the global average of 7%.

€6 billion was invested into European impact startups in 2019. This shows that what was once a fringe investment and innovation activity is becoming a core part of European innovation ecosystems.

UK making an impact

When it comes to the UK specifically, investment into impact startups increased 9.5x between 2014 and 2019. So far in 2020, UK impact tech companies have raised €1.4 billion, with cleantech and climate tech companies raising the most capital of all UK impact startups.

George Windsor, Head of Insights at Tech Nation, comments:

“UK impact tech firms have come on leaps and bounds over the last six years – with nearly 10x more investment made into ground-breaking companies in 2020 than 2014. UK tech must continue to play a key part in tackling some of the world’s toughest challenges, including climate change. This revolution is happening right across the country.”

The biggest rounds for UK impact startups in 2020 can be found here, including Octopus Energy, Arrival, Connexin (Hull), Tokamak Energy (Abingdon), Compass Pathways, Cera, Highview Power, FiveAI (Cambridge), The Meatless Farm Company (Leeds).

Climate tech companies, which includes electric vehicles, have attracted the most investment within the impact sub-sector, with European players emerging as global market leaders. European companies working to tackle climate change and its impacts have attracted €9.8 billion in VC investment in the last five years.

At Beavis Morgan, we specialise in working with startups and entrepreneurial people across a wide range of sectors, providing guidance and strategic advice to help in formulating plans for your business in order to strengthen its prospects of success, achieve growth and maximise wealth.

Our technology business experts and Research & Development (R&D)* specialists are available to assist with setting up and running your business, as well as maximising the value of any potential R&D tax relief claims.

And our team at BM Structured Finance is readily available to source any funding required to enhance your immediate and long term success.

Contact Steve Govey or your usual Beavis Morgan Partner for more information about how we can assist you and your tech business.

Source: Tech Nation

*R&D tax relief – money back for innovation

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