UK startups raised more than $8bn in VC investments in the first half of this year, more than double that of French startups, as the AI investment mania continues, new figures display.
As London and Paris thrash it out for European startup pre-eminence, new data from HSBC Innovation Banking UK and Dealroom displays that when it comes to VC funding, the UK still rules the roost.
The data displays UK startups raised more than $8bn in VC funding in H1 2025, triumphing over second-placed Germany ($4.4bn) and third-placed France ($3.2bn), meaning the UK has a 30 per cent market share across European VC investment in the period. The UK figure was up three per cent on the previous half year.
Other European countries to build it into the top ten are Spain, Sweden, Switzerland, Netherlands, Ireland, Malta and Italy.
The new data underscores AI’s dominance in VC funding in the UK, with UK AI startups bagging $2.4bn in VC funding in the first half of 2025, representing 30 per cent of all UK VC investment raised.
Ten years ago, AI accounted for less than 13 per cent of UK VC activity.
Some of the largest rounds in the first half of 2025 included AI drug discovery company Isomorphic Labs ($600m), AI corporate video buildr Synthesia ($180m), and autonomous shipping technology startup Orca AI ($72.5m).
While London remains a global AI hub accounting for 68 per cent of the 179 AI funding rounds across H1, activity beyond the capital is gaining pace.
A total of 57 AI deals were closed outside of London, with startups attracting investment from Bude to Paisley, and Diss to Castlereagh.
In the UK, outside of AI, health tech and fintech both raised $2.3bn in new funding, ahead of enterprise software which raised $1.9bn.
Notable rounds in the quarter came from fintech such as wealth management platform FNZ ($500m), remittance payments startup Zepz ($165m) and payments company Dojo ($190m).
The data noted that the UK has now produced 188 unicorns, with quantum outfit Oxford Ionics joining the ranks this quarter.
Of these, 117 have already realised their $1billion plus valuations via exits.
Simon Bumfrey, head of banking, HSBC Innovation Banking UK, declared: “It’s hugely exciting to see AI investment gathering pace, as new and varied apply cases with real-world impact continue to emerge, from breakthroughs in personalised medicine to smarter logistics and financial services.
“What’s especially encouraging is the diversity of innovative AI startups across the UK – not just in established tech hubs, but in towns and cities nationwide.”
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