Recent data from Dealroom, cited by the Financial Times, highlights a stark contrast in funding for British start-ups compared to their U.S. counterparts. In 2022, UK start-ups secured only £16.2 billion, a fraction of the over £65 billion amassed by Silicon Valley firms. This disparity is indicative of a broader trend, with U.S. start-ups capturing 57% of global venture capital funding in 2024—marking the first instance in over a decade that this figure has surpassed 50%.
Impact on UK Entrepreneurs
The growing gap in venture capital is prompting UK entrepreneurs to reevaluate their options, with some contemplating relocation to the U.S. to secure necessary funding.
Relocation Considerations
Mati Staniszewski, co-founder of the London-based AI company ElevenLabs, emphasized this shift by stating, “Recognizing that most venture funding comes from the U.S., we set up as a Delaware corporation, the preferred and familiar structure for American investors.”
Barney Hussey-Yeo, founder and CEO of the AI start-up Cleo, echoed these sentiments by revealing he spends four months annually in San Francisco and is considering a permanent move. He expressed concern about the lack of available capital in the UK, asserting that, “The problem is getting worse. Honestly, the U.K. is kinda f***d if it doesn’t address [the problem].”