Investment into West Midlands tech sector triples in 2020
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Tech startups and scaleups in the West Midlands raised a record £390m in funding in 2020, almost three times more than 2019’s previous record of £132m.
According to new data by Tech Nation and job search engine Adzuna, the West Midlands tech success story in 2020 was Gymshark, the Solihull-based fitness e-commerce platform which raised £200m in growth equity funding to become the region’s second-ever unicorn, a private company valued at $1bn or more.
However, Gymshark isn’t the only tech company making waves from the region. Other startups and fast growing tech businesses are raising larger rounds too including MitrAssist, a biotech firm that has created a minimally invasive way to treat heart valve disease, which raised £51m in Series B funding in December.
Nourished, a 3D-printed vitamin startup, raised a £2.1m seed round earlier in the year, one of the largest seed rounds raised by a woman founder in the UK.
Across the region, tech companies are showing positive signs of recovery from the coronavirus pandemic.
In Birmingham, there are 10,948 open job roles, of which 1,519 are in tech companies, making up 14% of all open vacancies in the city.
Overall, there are 5,099 open tech roles in the West Midlands, at companies including BT, Premier IT, Balfour Beatty and Aldi.
Specialist tech workers such as network engineers and solutions architects are in high demand in Birmingham in particular, resulting in high salaries. The average advertised salary for a network engineer has increased by 60% over the last 12 months, to £73,246, whilst for a solutions architect the average salary is £72,854, an increase of nearly 24%. Tech workers in the city can command an average advertised salary of £50,126, compared to £46,305 for the wider region.
Fintech and gaming strengths
The region benefits from having a varied and widespread tech industry. Though many see London as the UK’s fintech hub, the West Midlands is home to one of the largest regional fintech clusters in the UK, with around 122 fintech-related firms across Birmingham, Solihull, Warwick and Leamington Spa. Gaming is another key area the West Midlands excels in, with around 130 companies across the region, including the likes of Ubisoft, Codemasters and Playground Games calling the area home. It helps that there are 10 universities in the region, providing a regular stream of skilled graduates.
Minister for digital Caroline Dinenage said: “It is fantastic to see these new figures showing the strength and depth of the West Midlands tech sector. The region is home to stellar British tech firms such as Gymshark and Ubisoft alongside thousands of exciting startups and scaleups. We are committed to creating the right business environment and are investing in skills and research and development so the region remains a hotbed of investment, innovation and talent.”
Dr George Windsor, head of insights at Tech Nation said: “From fintech to gaming, the West Midlands has a widespread and varied tech ecosystem. With companies in the region starting to raise big later stage rounds, it demonstrates the maturity of the industry, so it’s certainly an interesting time to be meeting with founders and ecosystem partners to discuss the challenges they’re navigating in 2021.”
Andrew Hunter, co-founder at Adzuna, said: “Whether it’s an established tech company like BT or a smaller startup, competition is high for skilled staff in the West Midlands which is why we’ve seen salaries for roles like network engineers and solutions architects jump so much in the past 12 months. Ensuring there is enough specialist talent to go around is key for companies of all sizes in the region.”