UK founders grow frustrated over dearth of funding: ‘the problem is getting worse’

According to data from Dealroom, as reported by the Financial Times, British start-ups only managed to raise £16.2 billion in funding last year. This amount pales in comparison to the more than £65 billion raised by Silicon Valley start-ups during the same period. The United States seems to be pulling further ahead each year, with 57% of global venture capital funding going to U.S. start-ups in 2024 — a share that has not exceeded 50% in over a decade, according to Dealroom.

This widening gap has caught the attention of U.K. founders, prompting many to contemplate moving their operations overseas, as reported by the FT.

Mati Staniszewski, co-founder of London-based AI company ElevenLabs, acknowledged the dominance of U.S. venture funding by opting to set up as a Delaware corporation, a structure preferred by American investors, as he shared with the FT in an interview.

Barney Hussey-Yeo, founder and CEO of AI start-up Cleo, revealed to the FT that he already spends a significant amount of time in San Francisco and is contemplating a permanent relocation due to the lack of available capital in the U.K. He emphasized the urgency of addressing this issue, stating, “Honestly, the U.K. is in trouble if it doesn’t tackle [the problem].”