Investment in the UK’s sustainable startups increased by nearly tenfold in the five years from 2014 to 2019.

Research from Tech Nation and Dealroom showed that investments in ‘impact startups’ - those addressing one or more of the UN Sustainable Development Goals - increased by 9.5 times over the five-year period.

These companies have so far raised a total of €1.4 billion in 2020, with the largest investment rounds going to renewable energy firm Octopus Energy and The Meatless
Farm Company.

Other CleanTech and climate tech startups to have benefitted from funding this year are: Arrival,Connexin (based in Hull), Tokamak Energy (based in Abingdon), Compass Pathways, Cera, Highview Power, and FiveAI, which is headquartered in Cambridge.

A total of €6 billion was invested into European impact startups in 2019, making up over 15 per cent of all venture capital (VC) investment in the region.

The research showed that what was once fringe investment and innovation activity is finding traction and proven success in Europe, becoming a core part of European innovation ecosystems.

Climate tech startups - which include 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.

Impact innovation startups are also fuelling job creation, the study found, with the impact and innovation database showing that these companies are actively hiring for more than 2,100 job roles in Europe, with over 390 of these based in the UK.

The research comes as Tech Nation and Dealroom launch their impact and innovation database, which catalogues 4,939 startups and scaleups, 7,472 funding rounds, and 232 exits of innovative companies addressing the world’s most pressing challenges.

George Windsor, head of insights at Tech Nation, said: “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 and Tech Nation is pleased to work with some of the leading companies in this space through our world-first Net Zero programme - ensuring that companies working in this sector can scale to have the greatest impact.”

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