The number of new tech companies incorporated in the UK jumped 62 per cent in 2021*, according to new analysis by leading audit, tax and consulting firm RSM UK.
A total of 38,240 tech businesses were incorporated in 2021 according to an analysis of data held by Companies House, up from 23,579 in 2020.
London accounted for the highest number of incorporations in 2021 at 18,549, followed by the South East at 4,115 and the North West recording 2,371 new tech firms.
All regions in the UK saw an increase in tech incorporations, with London recording the highest percentage increase of 94 per cent. This was followed by the West Midlands at 61 per cent; the North East at 59 per cent; Northern Ireland at 44 per cent and the North West at 43 per cent.
The UK tech sector this year became only the third economy, alongside the US and China, to reach $1tr in value after a surge in growth throughout the pandemic. The UK’s digital industry is now worth more than double Germany’s equivalent, its closest European rival. RSM’s latest analysis further evidences the UK’s key role in supporting entrepreneurs and encouraging innovation.
David Blacher, partner and head of Media and Technology at RSM UK, comments on the findings: ‘Our analysis shows an unprecedented level of tech incorporations. As expected, London saw the biggest take-up, but the regions aren’t getting left behind. To be seeing incorporations increasing by between 40 – 60 per cent in regions throughout the UK is very encouraging and it is clear to see that the tech sector has thrived in conditions where other industries have either slowed or declined.
‘Covid-19 has encouraged more businesses to embrace technology, both to operate successfully during periods of disruption and to adapt to shifting consumer demands. The rollout of 5G and experimentation with new ideas such as the metaverse and crypto has led to more companies perceiving themselves as a tech business which wouldn’t have been the case in the past.’
Tech company incorporations by year
|East Midlands (England)||794||975||23%|
|East of England||1,722||2,190||27%|
|North East (England)||295||469||59%|
|North West (England)||1,658||2,371||43%|
|South East (England)||3,056||4,115||35%|
|South West (England)||1,156||1,445||25%|
|West Midlands (England)||1,119||1,799||61%|
|Yorkshire and The Humber||849||1,135||34%|
*Analysis of Companies House data (tech companies incorporated between 1 January 2020 – 31 December 2020, compared to 1 January 2021 – 31 December 2021).