A new report from Tech Nation, commissioned by the UK’s Creative Industries Council is providing new insight into the size and the value of the country’s Creative Technology, or ‘CreaTech’ industries.
The report, the first of two to explore the creative technologies sector in the UK, looks at investment within the sector and the types of companies which are pioneering, and securing funding.
What Actually Is CreaTech?
The report defines ‘CreaTech as:
The interface of the tech, and creative industries – which captures both the transformation of the creative industries by technology, and the co-creation of new tech products and services for creative outputs, processes, products and services.
Sectors falling within this definition include Design, Crafts, Music, Museums, Fashion, Film/ TV/ Radio, Music and Entertainment, esports, Marketing Tech, Architecture, Augmented Reality, Virtual Reality, Adtech, Gaming and Media.
UK Overview
Despite the challenges presented by Covid-19, lockdowns, remote working, Brexit, and other factors, 2020 was a record year for the UK’s CreatTech sector with regard to funding and investment with £981.8 million raised over the course of the year.
This continues a trend of year-on-year growth within the sector over the last several years. In 2017 the UK’s creative technology sector secured £498.8 million, growing to £759.43m in 2018, and £803.46m in 2019.
A great deal of this investment was focused on including Artificial Intelligence (AI) and Machine Learning (ML) (which raised £478m); Technology, Media and Telecom (£440m); Mobility tech (£285m); Marketing tech (£206.58m); and Immersive Reality companies (£130m).
Strangely, while gaming grew to become the world’s largest entertainment sector in 2020, the UK industry received a far smaller amount of investment, with only £32.79m investment over the course of the year.
UK Clusters
The report also shows that successful CreaTech companies exist and are raising money across the whole of the UK. Several clusters are highlighted as driving the sector forward, including:
- Companies in London received £486m in VC investment, an increase from from £352m in 2019
- The South East of England raised £24m from 11 deals
- The East of England raised £13m from 5 deals
- Scottish CreaTech companies raised £7.5m in investment, an increase from £4.6m in 2019
Also according to the report CreaTech is one of the few areas where London business are not leading the rest of the country. The South West of the UK had the highest median investment in CreaTech of £1.65m, followed by Scotland with £1.37m, while in London median investment was £1.21m.
Numbers In Context
The UK was third in the world for CreaTech investment in 2020, but more CreaTech dense than any other top nation, with around 9% of total tech VC investment represented by this rapidly evolving space.
The US is the world leader when it comes to CreaTech several high value ‘unicorns’ in the sector. In 2020, £6.5 billion was invested into US Createch companies, more than triple the next highest country, China. Chinese CreaTech companies raised £1.9bn in 2020, more than all other Asian nations combined.
Coming Soon
In the second part of the research Tech Nation promises to explore employment, jobs and skills within CreaTech, as well as exploring the opportunities and challenges for the future growth of the sector.
You can find the complete CreaTech Report 2021 on the Tech Nation website.
Brian has been working in the games industry since the mid-1990s, when he joined the legendary studio DMA Design, as a writer on the original Grand Theft Auto. Since then he's worked with major publishers, founded his own digital agency, and the Scottish Games Network. At various times he's worked as a journalist, editor, narrative designer, lecturer, executive producer, and director.
