\The London startups and scaleups to watch in 2021

\The London startups and scaleups to watch in 2021

London is the top startup city in Europe. Which companies should be on your watchlist?

So far this year London startups have raised a record €11.8bn from VC funds, more than the €14.5bn in all of 2020.

But which are the most exciting startups and scaleups based in the city? Which are the ones to watch in 2021?

Our team of experts at Sifted have chosen a list of more than 130 exciting companies we think you need to know about, with an added 'Sifted take' on some to provide an extra layer of insight.

It's a mixture of the big and the small, the well known and the under the radar. But all are making waves. Keep reading below and stay informed about Europe’s new economy!

(P.S The data is from European Startups, with valuation estimates from Dealroom. If there is anyone missing from this list, or anything is wrong, please let us know by email at [email protected]).

Key

Year founded

Amount raised

Last funding round

Valuation

Employees

Hopin's logo

Hopin

All-in-one live online events platform

events /

hopin.com

London, UK

2019

€520m

SERIES C

€1.9bn

100-500

Sifted Take

The epitome of the Covid-boosted rocket ship, online events platform Hopin gained its spot on Europe's unicorn list just eight months after launch.

In 2020, it was Europe's fastest-growing company — but will it be able to sustain that growth as vaccines roll out and some events, perhaps, return to physical venues?

Read more: Online events startup Hopin hits $2.1bn valuation just 8 months after launch

Zego's logo

Zego

Insurtech for business

fintech / insurance

zego.com

London, UK

2016

€183m

SERIES C

€153-229m

100-500

Sifted Take

Insurtech Zego, which was the first in the UK to gain its own insurance licence in 2019, made some interesting strategic moves in 2020. It bought Drivit, a telematics company, in order to revolutionise commercial motor insurance; partnered with Broker Network and Compass Networks to access 60% of the UK independent broking community; and now covers all of Tier's escooters. What will it do next? “The Little Prince made me cry” — Bookclub with Sten Saar, cofounder of Zego

18 fintechs that investors think will thrive post-lockdown

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Cera's logo

Cera

Professional home care for elderly people

health / health platform

ceracare.co.uk

London, UK

2015

€83m

SERIES B

€255-382m

50-100

Sifted Take

Cera is one of the best-funded healthtechs that focus on older people, in February 2020 raising $70m in an equity and debt round led by KairosHQ. Its two-pronged strategy involves partnerships with the NHS and local authorities, and acquiring existing, profitable care companies. With an ageing population to look out for, Cera is the one to watch.

Read more: Fixing an ageing approach to care

Tessian's logo

Tessian

Cybersecurity using machine learning tech

security; enterprise software / data protection

tessian.com

London, UK

2013

€111m

SERIES C

€145-218m

100-500

Sifted Take

Cybersecurity firm Tessian works to protect employees' emails, and in 2020 launched a new product called Human Layer Security Intelligence which gives businesses insight into security threats and tools needed to reduce the probability of phishing attacks, data extrafiltration and accidental data loss. The company has raised $60m from investors such as Sequoia and Accel.

Onfido's logo

Onfido

Identity verification engine for enterprises

saas; B2B; enterprise software / regtech & compliance

onfido.com

London, UK

2010

€192mm

GRANT

€364-545m

100-500

Revolut's logo

Revolut

Online banking platform

fintech / banking

revolut.com

London, UK

2015

€836m

SERIES D

€5bn

1000-5000

Sifted Take

Revolut almost needs no introduction, as one of the fastest-growing digital banking apps in Europe. Indeed, it came first in the UK in terms of jobs advertised in 2020.

Having begun as a travel currency-exchange card, the company has since expanded aggressively into a full range of services, including cryptocurrency and stockbroking services. Led by Nikolay Storonsky, the company reports having 11m customers, and is adding around 11k accounts a day.

According to an analysis by Sifted last year, Revolut leads its peers Monzo, N26 and Starling in terms of downloads, deposits and revenues — even when adjusted for time.

Its 2020 fundraise of £460m also valued the company at $5.5bn, placing it first in the UK in terms of investment raised that year. Revolut now has ambitions of gaining a UK bank licence and conquering the US and Asia.

However, amid fast growth, Revolut has also been stung by complaints of a toxic corporate culture, while The Telegraph claimed the company turned off a system designed to prevent money laundering for three months in 2018 (Revolut denies both).

Read more: Digital banks Monzo, Revolut, Starling and N26 compared

Revolut staff vent frustration over share options

Europe is beating the US in fintech innovation, says Revolut’s Nikolay Storonsky

OakNorth's logo

OakNorth

Bank focused on small and medium-sized businesses

fintech / banking / mortgages & lending

oaknorth.com

London, UK

2015

€783m

SECONDARY

€2.2bn

10-50

Sifted Take

OakNorth is largely comprised of a bog standard bank, which has had a meteoric rise granting loans to small businesses.

OakNorth Bank has a large loan book, with around £3bn in outstanding loans at the last count, and just two defaults. The bank made £66m in profit last year, making it one of the most profitable financial newcomers in Europe.

Still, OakNorth’s $2.8bn valuation largely rests in its “credit science” arm. The company white labels its credit-analysis technology (dubbed Acorn) to non-UK banks, with a handful of clients now signed up.

SoftBank’s Vision Fund led a high-profile funding round into the fintech in 2019.

Read more: Seven OakNorth power-players pulling the strings behind the scenes

Babylon Health's logo

Babylon Health

High quality healthcare via mobile phone

London, UK

2013

€877m

SERIES C

€1.8bn

1000-5000

Sifted Take

Babylon Health has made itself plenty of friends in high places — and enemies too. The digital health company, which provides online consultations and has a symptom-checking app, has become known for making bold claims about what its AI can achieve and for butting heads with GPs in the UK. It's also been used as a poster child for digital transformation in healthcare by the likes of UK health minister Matt Hancock and raised huge amounts of funding from Saudi Arabia's investment fund.

Still, squabbles with UK doctors don't seem to be where Babylon is focusing its attention now: it's planning to launch in the US.

HungryPanda's logo

HungryPanda

Chinese food and groceries delivery

London, UK

2016

€82m

SERIES C

€255-382m

100-500

Sifted Take

In late 2020, the Asian-focused food delivery app HungryPanda raised a $70m Series C round led by Kinnevik. There's clearly a huge market for it — it operates in 47 cities across the world — and the startup plans to double its team. The app's in Mandarin, so in a saturated food delivery market, it's occupying a very secure niche that will continue to do it good as food delivery becomes the norm.

The not-so-niche food delivery player to watch: HungryPanda raises $70m

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Lendable's logo

Lendable

Lending platform

fintech / lending

lendable.co.uk

London, UK

2014

€500m

SECONDARY

€1bn

50-100

Sifted Take

The Goldman Sachs-backed digital lender is now worth over £1bn following a secondary sale — having only raised £4m in equity to date.

But it’s long been one of those rare fintechs that’s actually profitable, previously trumping the combined profits of Azimo and Zopa. Phenomenally, it was started by two young graduates in their mid-20s in 2014 (who placed on Forbes’ 30 under 30 in 2018) with a mission to undercut traditional banks by fast-tracking applications and offering competitive rates. Today it approves a new loan every 30 seconds.

The company's £1bn+ valuation is a big jump from the £500m it was last rumoured to be priced at when Balderton led a secondary sale in 2018.

It’s rumoured to be expanding into the US and new investors Stefan Glänzer and Eileen Burbidge — Goldman Sachs and Passion Capital’s top partners — are investing in a personal capacity.

Get the full story here.

Monzo's logo

Monzo

Online banking platform

fintech / banking

monzo.com

London, UK

2015

€622m

SERIES H

€1.4bn

1000-5000

Sifted Take

Millennial-friendly neobank Monzo is the darling of London’s fintech world, onboarding over 4m customers at the last count. The startup is best known for removing the hassle from personal finances, as well as progressive features like gambling-blocks.

Despite its fans and unicorn valuation, however, the bank is renowned for its “disrupt-now-and-make-money-later” approach. Monzo’s losses climbed to £115m in the fiscal year ending February 2020, outspending both competitors Starling and Revolut.

Commentators suspect this has played into a dramatic rehaul of the executive team, including a new CEO to replace founder Tom Blomfield, who appears to be quitting the fintech due to his suffering mental health. These results may have influenced the stark dip in Monzo’s valuation, which saw it cling onto unicorn valuation at £1.25bn.

But, while sceptics of its business model abound, there are also some positive signs to flag. Monzo’s unit economics finally entered the green in February 2019, with each customer making £4 a year on average in revenue. It’s still small, but it’s a good improvement from the net loss per customer of £15 they recorded in 2018. The company has also launched two subscription products, hoping customers will pay to use premium services.

Read more: Inside Monzo 2.0: Who’s running the show now? Monzo founder Tom Blomfield is quitting the digital bank after asking execs for “help” Who is Monzo’s new CEO, TS Anil? There’s something about Monzo

Improbable's logo

Improbable

A cloud-based platform for game developers to create AI-powered simulated worlds

gaming / enterprise software

improbable.io

London, UK

2012

€547m

GROWTH EQUITY

€1.8bn

500-1000

Sifted Take

Simulation software startup Improbable has always had an aura of mystery about it — partly because it operated in stealth for a long time, gained a billion-dollar valuation not long after launching and has landed numerous deals with the military.

Founder Herman Narula has sold investors including SoftBank and Andreessen Horowitz on his vision to "build the Matrix". The big question is whether he can actually pull it off.

Ki Insurance's logo

Ki Insurance

Digital Lloyd's of London syndicate

insurtech /

ki-insurance.com

London, UK

2020

€455m

SEED

10-50

Sifted Take

Launched in May 2020, KI is off to an impressive start. Using an algorithim designed in collaboration with UCL, it will evaluate Lloyd's policies and automatically quote using a platform built by Google Cloud. In 2020 it raised $500m in a seed round led by Blackstone and Fairfax Financial Holdings.

Starling Bank's logo

Starling Bank

Mobile-app based bank

fintech / banking

starlingbank.com

London, UK

2014

€876m

LATE VC

£540m

500-1000

Sifted Take

Starling is the youngest of the consumer-focused digital challenger banks. Although founded in 2014, it launched in 2017, after Revolut in 2015 and Monzo in 2016. It’s also smaller than both in terms of the number of users.

But in a fiercely competitive sector (Monzo’s Tom Blomfield worked at Starling before staging a walkout of top executives and forming the rival bank) Starling is on track to be the first to actually make a profit.

This is due to success outside just retail banking in the ream of business accounts and offering banking-as-a-service products to other financial institutions. There are also rumours of a planned IPO in 2022.

The company is 20% owned by staff with the rest owned by two main backers — Austrian-born investor Harry McPike and Merian Global Investors.

Related: Starling, Revolut and Monzo’s annual results compared

Inside Anne Boden’s Starling

Snyk's logo

Snyk

Open source security platform

security / enterprise software

snyk.io

London, UK

2015

€684m

SERIES E

€2.4bn

100-500

Sifted Take

It would be hard to jumble more jargon into one company's Google ad word listing than Snyk's: 'Dev First Security - Securing Cloud Native Apps'.

In plain speak, London-based Snyk helps developers find vulnerabilities in their code and keep businesses secure. In 2020, the startup raised £280m, placing it third in the UK in terms of investment raised behind Revolut and Cazoo.

SaltPay's logo

SaltPay

FinTech company dedicated to building a better future for merchants by servicing them through payment and management tools

fintech / financial management solutions;payments

saltpay.co

London, United Kingdom

2019

€571m

SERIES C

€909m

100-500

Zopa's logo

Zopa

Digital bank

fintech / mortgages & lending;banking

zopa.com

London, United Kingdom

2005

€434m

LATE VC

€780m

100-500

Pollinate's logo

Pollinate

A software business, focused on reinventing merchant acquiring for banks around the world

fintech / banking;payments

pollinate.co.uk

London, United Kingdom

2017

€199m

SERIES C

€420m

50-100

Dishpatch's logo

Dishpatch

Bringing the UK's best restaurants home

food / food logistics & delivery

dishpatch.co.uk

London, UK

2019

€13m

SEED

€48-72m

10-50

Huma's logo

Huma

Transforming healthcare and research globally

health /

huma.com

London, United Kingdom

2011

€167m

SERIES C

€473-709m

50-100

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