Health AI start-ups in the UK raised more than their fintech peers
- Afiq Fitri
- Dec 14, 2021
- 3 min read
Covid-19 and the digitisation of healthcare saw 'AI-centric' health tech companies in the UK raise more capital in 2021 than their finance-focused counterparts.
AI-centric health-tech start-ups in the UK raised more investment this year than their peers in the fintech sector, according to a new study. Fintech has been the darling of the UK’s start-up sector in recent times, but the pandemic and the ongoing digitisation of healthcare triggered a global boom in health-tech investment.
AI investment in the UK
Investment in UK-based ‘AI-centric’ companies soared to £3.1bn this year after a slump in 2020, according to the study of 2,000 ‘AI-centric’ start-ups by Deep Knowledge Analytics and Innovation Eye.

Healthcare-related AI start-ups attracted the most investment in 2021, raising a total of £683m – more than double the figure in 2020. Recipients included Babylon Health, which raised $200m (£150m) in 'sustainability-linked investment' from private equity firm Albacore Capital in October. Later in the month, the company floated on the New York Stock Exchange via a SPAC.

This surge in 'health-tech' investment was a global phenomenon, spurred by the pandemic and the digitisation of healthcare via smartphone apps. In the US, health-tech saw record highs in both deal volume and size in 2021, according to a recent report by Deloitte. In Europe, venture capital investment in health start-ups nearly doubled in 2021, from £3.5bn to $6.8bn.
UK-based AI start-ups played a role in the Covid-19 response, the report notes. In January 2020, scientists from drug discovery start-up BenevolentAI analysed previously approved drugs that had the potential to treat Covid-19. It discovered that baricitinib, a rheumatoid arthritis drug, has previously unknown anti-viral properties. Japan has approved baricitinib for Covid-19 treatment, and the EU is following suit.
Meanwhile, the UK's AI-powered fintechs drew in £567m in investment in 2021, a drop from £660m last year. HR-related AI start-ups raised the third most, up 155% to £212m - examples include HR software provider Hibob raised $150m (£115m) – while the fastest-growing segment was 'consulting and outsourcing', which grew sevenfold to reach £184m.
The UK's best-funded AI start-ups
Deep Knowledge Analytics and Innovation Eye have tracked investment in UK-based AI start-ups since 2019, and the new report reveals the best-funded start-ups during that time.

OakNorth, an SME bank that uses machine learning to inform lending, has raised the most in the past three years, with £790m of investment including $440m (£330m) from SoftBank in 2019. Earlier this year, however, the bank was hit with loan defaults worth nearly £100m. In October, one of its largest investors sold its shares for 25% less than their most recent valuation.
Other big recipients include Bristol-based AI chipmaker Graphcore, which has raised £522m since 2019, and Babylon Health
.
UK leads AI preparedness in Europe
An analysis of the most recent iteration of Tortoise Media’s Global AI Index found that the UK currently leads Europe in terms of AI preparedness while ranking third globally, coming behind China and the US. Other countries like Germany, France, and the Netherlands are close behind as Europe attempts to close the gap with other regions.

The UK scored particularly high because of the strength of its recently announced national strategy, private sector investments, as well as its spending commitments. However, it has been pointed out that the number of patent filings for AI innovation in the UK has dropped by 11%, and the current healthcare surcharge for migrants may be a deterrent for promising regional and international AI talent to work in the UK.
Source: techmonitor.ai




The fact that Health AI is outperforming Fintech in fundraising is a massive signal—it shows capital is shifting toward AI applications with high societal value. After digesting a data-heavy report like this, I usually hop onto minigame for a few minutes. It’s a great way to handle "context switching" and refresh my brain before diving into the next analysis.
The surge in funding for health AI over fintech really highlights how investors are betting on deep, specialized expertise over broader, trendier sectors. It’s a reminder that doubling down on what you do best—whether you’re a startup or an agency—can pay off faster than chasing every opportunity. I’ve taken the same approach with my agency: instead of trying to build every skill in‑house, I focus on my core strengths and partner for the rest. Using private label seo lets me offer expert services under my own brand while staying lean and specialized. Sometimes the smartest growth move is knowing what not to build yourself.
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