The first-half funding data has landed and it reframes the year for anyone building in London. Here is what the numbers say, and what they mean if you are raising right now.
UK startups raised about $17bn in H1 2026, the best since 2022
New figures put UK startup funding at roughly $17bn across the first six months of 2026, the strongest half since 2022, with artificial intelligence companies taking about 74% of all venture capital deployed. It is a sharp recovery on the flat years that followed the 2021 peak.
The headline is encouraging, but the concentration matters: if you are not framing an AI angle, you are competing for a shrinking slice of the pot. Founders raising outside AI should plan for longer processes and lean harder on revenue traction. Read the funding breakdown.
London pulled in 86% of UK tech funding
Companies based in London took 86% of the country’s technology funding in the first half, up from 79% in the previous six months, cementing the capital’s gravity for capital and talent. The flip side is a widening gap for founders outside the M25.
If you are London-based this is a reminder that investor access is on your doorstep, so use it: warm introductions, demo days and sector meet-ups still convert better than cold outreach. If you are building elsewhere, budget for regular trips into the city rather than hoping a deck travels on its own. See the regional split.
PhysicsX hits a $2.4bn valuation on a $300m Series C
London deep-tech firm PhysicsX closed an oversubscribed $300m Series C led by Temasek, roughly doubling its valuation to about $2.4bn less than a year after its Series B. The company builds AI models for industrial and manufacturing engineering and has grown its team past 300 people.
For local founders it is a useful proof point that hard, applied AI (not just chat products) is drawing the biggest cheques, and that Temasek-scale investors are writing them into London. If your product sits at the meeting of AI and a real-world engineering problem, the appetite is clearly there. Read the announcement.
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