Why GBA tech companies should invest in London

Prior to CBBC’s UK-GBA Conference, which took place in Shenzhen on 21 November 2023, Tom Pattinson spoke to Janet Coyle CBE of London and Partners about why Chinese tech companies want to invest into London

The hall at London’s Battersea Power Station is packed, full of start-ups, innovators, entrepreneurs, and scale-ups, all eager to absorb insights from the expert panel of tech companies, venture capitalists, investors, and futurists gracing the stage. This was the Future Horizons event, part of the annual Grow Summit presented by London and Partners. Speakers included executives from Mastercard, a16Z, Fidelity and other renowned entrepreneurs and business leaders such as Baroness Martha Lane-Fox of Soho, the co-founder of Lastminute.com, and Reid Hoffman, founder of LinkedIn.

Organisers London and Partners champion London as a rival to Silicon Valley, positioning it as a global investment hub with a strong emphasis on the tech industry.

Janet Coyle CBE, the organisation’s Managing Director of Business Growth, is heading to China to speak at the upcoming CBBC conference on the Greater Bay Area (GBA). She aims to attract the growing number of Chinese tech companies based in the GBA to invest in London.

“The GBA is by far generating the most opportunity. Fifty to sixty per cent of all our business comes from that area,” Coyle says. “We identify companies looking to expand into Europe, and we want them to choose London,” she adds. London and Partners is partly funded by the Greater London Authority, with the remaining funds self-sourced through sponsorships and events. Their primary goal is to draw investment into the capital, mostly through foreign direct investment (FDI) and by supporting companies looking to expand into London. They also attract and bid for major international business events and conferences, attract tourism, and assist London companies in going global.

Coyle acknowledges that recent geopolitical tensions have impacted London-based companies eyeing expansion into China. Still, she notes that Chinese interest in the UK remains strong.

For Coyle and her team, attracting Chinese companies to the capital is a complex and often slow process. Identifying suitable companies, understanding their needs, building relationships, and facilitating their launch in London can take years. Coyle cites Chinese FinTech company Ping Pong and electric car company BYD as recent high-profile successes.

Coyle explains that inbound Chinese investment slowed somewhat due to the Covid-induced pause and a focus on domestic growth keeping many companies from expanding abroad. However, she notes, “now we’re starting to see the momentum building. London is home to the second-highest number of Chinese companies after Singapore.

“Chinese companies want to come because of the business infrastructure, the talent, the innovation, and the available growth capital,” she emphasises. “Despite global trends, we are still seeing VCs investing, and London remains a great place to live, with a large Chinese community.”

Over the last six months, London and Partners has regularly connected scale-ups to corporates. Previously limited to London companies, their “meet the corporate” programmes are now open to any global scale-up.

“Whether it’s a company from Shanghai or Shoreditch, they all want the same things: access to customers, money, growth capital, talent, and ideally, access to new markets,” Coyle says. “If we’ve got a company from Shanghai interested in electric vehicles or wanting to connect with, for example, City Hall, we can now make that happen.”

While London and Partners is not a lobbying organisation and align with government decisions, they can assist Chinese tech companies in finding their feet in London, with a predominant focus on sustainability, enterprise, fintech, cyber, creative tech, and health tech or life sciences.

“What’s driving global FDI flow is sustainability right now,” Coyle states. “And wherever you go, including China, everyone is asking about sustainability. London is ranked number one globally for Green Finance.”

In addition to clean tech and sustainability, health tech, and mobility, there is a strong demand for creative tech – immersive, gaming, VR, AR – though Coyle admits that FinTech will always be strong for London.

“As a city, we have reinvented ourselves over hundreds of years and are used to it. Whether it’s Covid-19 or global downturns, we have incredible entrepreneurs who get us out of this and build incredible pieces of tech,” she concludes. “FinTech emerged from a huge crash, creating a new model for banking. London stands strong in times like this.”