Venture capital (VC) funding of UK CreaTech businesses exceeded a forecast of £1.12bn to reach £1.14bn in 2021, according to data from Tech Nation.
Over £5bn has been invested in UK CreaTech businesses by VCs between 2017 and 2017, estimates Tech Nation, which in 2021 produced a two-part landmark report into CreaTech commissioned by the Creative Industries Council (CIC), in association with Digital Catapult and Moore Kingston Smith.
About 51 per cent of UK CreaTech businesses receiving VC funding were at the ‘seed stage’ of early development, suggesting room for future growth in investment and exports, and other forms of value creation.
The figures were released as the 2021 cycle for the CIC CreaTech 100 ‘Ones to Watch’ list, which features 100 businesses innovating at the intersection of creativity and technology, drew to a close.
Sources: Tech Nation, published in March 2022, 'Ones to Watch' event release.
The official Government statistics do not yet capture CreaTech as a specific area of economic activity. However, below are a few key data points that describe the background to the emergence of CreaTech businesses.
- According to the DCMS, the creative industries contributed £115.9bn in 2019, accounting for 5.9% of UK GVA. The Gross Value Added of the UK creative industries increased by 5.6% between 2018 and 2019 and by 43.6% between 2010 and 2019 in real terms.
- The ‘IT, software and computer services’ sub-sector contributed the most towards creative industries GVA in 2019 at £47bn, accounting for 40.6%. This sub-sector accounted for 53% of growth in creative industries GVA between both 2018 and 2019, and 2010 and 2019. This sub-sector also sits entirely within the Digital sector, which may explain similar trends seen in both the Creative Industries and Digital Sector
- The digital sector contributed £150.6bn in 2019, accounting for 7.6% of UK GVA. The GVA of the digital sector has increased by 6.1% between 2018 and 2019 and by 26.5% between 2010 and 2019 in real terms.
- Between 2016 and 2018, digital sector GVA increased in line with the UK economy up until 2018, with further growth in 2019.
- Of all DCMS sectors, the creative industries employed the most people (2.1 million), followed by the digital sector (1.6 million) and the tourism sector (1.4 million). However, there is significant overlap between DCMS sectors, so it is difficult to make comparisons between them.
Sources: DCMS statistics on Gross Value Added, published December 2020, and Employment, published in April 2020.
- According to the 2019 Immersive Economy report from Digital Catapult and Immerse UK, the UK is the largest European market for immersive technologies including virtual and augmented reality.
- The report estimates that UK virtual reality market alone is expected to increase in value from £118 million to £294 million by 2023. PWC estimates that by 2030, immersive technologies could add up to £62.5bn of value and affect 400,000 jobs in the UK economy.
- In 2019 the UK had over 1,250 companies that generate over 50 per cent of their revenue from consulting, services or products within the immersive domain. Nearly 300 companies operated in the media and arts category.
- The 2019 report identified 1,250 active immersive specialist companies in the UK with growth opportunities for immersive technologies across architecture, construction, engineering, manufacturing, defence, entertainment, healthcare, training, and transport
- 87 per cent of respondents said that immersive technologies helped them to improve their organisations.
- Over 500 immersive technology projects were identified (either ongoing, open or completed since 2018), worth over £220 million
Source: 2019 Immersive Economy report published in November 2019 by Immersive UK and Digital Catapult
- The UK’s first comprehensive report on skills for immersive experience production identified opportunities to skill up with 65% of companies identifying a lack of skills as a significant barrier to the growth of their business. Immersive experience production involves creating experiences using virtual (VR), augmented (AR) and mixed reality (MR) technologies.
- The report was conducted in collaboration with Immerse UK and the UK’s leading screen industries trade bodies, Pact, UKIE, British Screen Forum and UK Screen Alliance, drawing on data from over 100 companies, including interviews with 25 leading sector figures.
- It made a series of innovative recommendations to create the pipeline of talent needed to ensure the UK can retain its status as a world-leader in AR, VR and MR. These included an urgent call for cross-fertilisation between the arts and traditional sciences – to better integrate STEM (Science Technology Engineering and Mathematics) disciplines with the Arts (STEAM) Science, Technology, Engineering, Arts, and Mathematics.
- 80% of interviewees identified significant barriers to growth caused by a lack of technical skills, whilst over half of companies reported gaps in creative and management roles, such as producers and writers. Expertise in the use of Real Time Game Engines was identified as the single most important skill for successful immersive production and the biggest skills gap.
- 73% of those working in immersive had worked on less than five projects
- 44% of respondents were worried about the lack of graduates with relevant skills to keep up with demand
Source: Immersive Experience Creation Report, StoryFutures Academy, January 2020.
Still from British Council YouTube video. Produced by Dezeen (www.dezeen.com). Music by 800xL