Founders Factory: Helping UK Start-ups Thrive
The ecosystem for young companies in the UK is diverse and well-established, offering various levels of support to fuel growth, secure connections with investors, and thrive in a competitive environment. The UK, as a hub for tech, saw a slight dip in investment from venture capital groups in 2024, but hubs like Founders Factory continue to play a pivotal role.
In a report analyzing venture capital (VC) funding by KPMG, the UK’s drop in venture capital investment in 2024 was approximately $15 billion, down from $20 billion the previous year. This drop may seem contrary to the overall upwards trend of the industry, but the UK remains a strong market.
Conor Moore, global head of private enterprise at KPMG, suggests this is an anomaly, attributing the drop to several “mega deals”—financings worth more than $1 billion—especially in the US. Those large deals can make it challenging for even promising UK start-ups.
“That is less of a commentary on the health of the UK investing environment than it is on the frothiness of investment in other jurisdictions in this AI era,” says Moore. The UK decline last year was “not inconsistent” with some other European countries.
UK Start-up Infrastructure
UK start-ups have access to an established infrastructure designed to support their development. These resources include dozens of hubs across the country. Such hubs create ideal conditions where start-up companies can evolve, providing shared office space, research and development facilities, access to venture capital, as well as general business advice.
These organizations may run the gamut of start-ups themselves, to non-for-profit university spin-offs, to investment and finance companies. Hubs often include three-month “accelerators” to get a start-up ready for investment. Or there are “incubators” to assist a young company.
Founders Factory’s Role
One key player is Founders Factory, which topped the 2025 FT/Statista/Sifted ranking for the UK and Ireland, and landed at number five in Europe.
Based in London, with international offices in cities like Berlin, Singapore, and Sydney, Founders Factory has already invested in 300 “early stage” start-ups. These include Landvault, a metaverse technology company, acquired last year for $450 million. They also invested in Storyblok, a company that makes a publishing platform for corporate content, which last year raised $80 million in financing.
The hub provides start-ups product development support, including data science, technology, and marketing. They connect start-ups with potential investors.
Strategic Partnerships
Founders Factory partners with major corporations such as Aviva, L’Oréal, and Rio Tinto. Those companies advise their start-ups on how to best distribute products and conduct market research to increase sales.
Henry Lane Fox, CEO of Founders Factory, notes that this advice is particularly helpful for start-ups in business-to-business software, because it shortens the sales cycle. Funding is crucial for start-ups.
“Anything to shortcut that [sales cycle] and . . . to work with the start-ups is terrifically helpful,” he adds.
Helping connect start-ups with the right investors and explain their potential to scale, is also crucial, he says. “All start-ups are hungry for cash, so fundraising is absolutely crucial.”
Tembo Money and Aviva
Such partnerships can pay off. Tembo Money, a digital savings and mortgage platform for first-time buyers, co-developed its business with Founders Factory from the planning stage. Aviva is now their main investor.
Richard Dana, Tembo’s CEO and co-founder, noted that working with Founders Factory was, in his view, the safest way to start his second business at the time.
“[When starting Tembo] I had a young family [and] a mortgage. I kind of wanted to de-risk a little bit my second start-up and try and give it as much opportunity for success as possible.”
Dogpatch Labs
Dogpatch Labs, in Dublin, ranks fourth within the UK and Ireland, and is 20th in Europe’s list of start-up hubs. It offers workspace, incubators, accelerator programs, workshops, and a matchmaking service.
The hub works with start-ups from the time founders leave corporate jobs to building up their business culture in their own premises. Patrick Walsh, Dogpatch CEO and founder, notes that the best hubs are “entrepreneur-led” and provide start-ups with solid investor and talent connections.
The Future of Start-up Hubs
Some tech hubs are beginning to integrate retail stores and restaurants into their facilities, similar to the campus environments found at large technology companies. These trends show a shift towards creating a holistic environment and experience for entrepreneurs.
Conor Moules, co-founder and CEO of Barespace, a Dublin start-up that makes software for hair and beauty salons, suggests some of the benefits of such environments:
“[Dogpatch] provides so much more than an office space , . . . To have other CEOs around you that are doing something similar, that you can kind of spark off [is valuable].”
Investors also benefit from the facilities hubs provide. Dogpatch Labs, for instance, are a source of investment for VC firms like Delta Partners.
The current structures must evolve to continue success. Some experts suggest consolidation, to create more world-class “unicorns”—start-ups valued at more than $1 billion—and consolidate the UK’s tech hubs into a few regional hubs. This strategic consolidation will allow the UK to maintain its competitive position in the global tech start-up ecosystem.
