British startups raised £663m investment in the first month after the country went into lockdown, with the tech sector seeing the most activity, according to new research released today by Plexal and Beauhurst.

Plexal, an innovation centre and coworking space, and Beauhurst, a searchable database of the UK’s high-growth companies, has analysed UK investment activity from Monday 23 March 2020, the date the country went into lockdown, until Monday 27 April.

The two companies have analysed nearly 30,000 UK startups and fast-growth businesses and found that the total value of investments has increased by 34% compared to the same period in 2019, but deal numbers were down by 39%.

Startup funding amid coronavirus: Tech sector leads lockdown investments

The technology sector has been leading investment activity since the lockdown began, with the highest levels of investment in fintech, artificial intelligence, digital security and blockchain startups.

The UK tech sector had a record breaking year in 2019, with venture capital investment increasing by 44% and digital tech growing six times faster than any other industry. It is therefore not surprising that the tech sector is currently faring better than others, as many organisations look to digital solutions to reach customers and employees during lockdown.

However, Plexal says that the drop in the number of deals, with 114 deals in the four weeks since the 23 March, suggests that “the majority of startups could struggle to raise funding as a result of economic disruption”.

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Although the UK government has taken steps to support UK startups, with the launch of the £500m Future Fund to offer loans to eligible businesses and £750m in R&D funding, many are currently struggling to attract investment in these uncertain times.

Acording to Plexal, nearly 263 small businesses are currently in administration and 707 are in liquidation. The week after lockdown was announced in the UK saw the lowest level of investment since w/c 28 March 2016.

Plexal will continue to track startup investment during the Covid-19 pandemic, and will update its research weekly.

“While the Future Fund is an excellent first start, it’s clear that more is required to protect the businesses that have driven job creation and economic growth in the UK for the last 10 years. This research is designed to cut through the doom and gloom and speculation to see which parts of the startup ecosystem are thriving, and which need urgent support. While tech startups have shown remarkable resilience in their ability to continue attracting investment, the success of the few mustn’t overshadow the struggles of the wider majority of British startups,” said Andrew Roughan, managing director of Plexal.

“If we don’t act now to stimulate the market and ensure funding is distributed widely and quickly, we risk a lost generation of startups and entrepreneurs. We’ll be closely monitoring deal numbers, liquidations and early stage rounds in the coming weeks and months to provide an accurate lens through which to judge whether the support mechanisms are working as desired.”

Read more: Future Fund: The tech sector reacts to UK Chancellor’s plans to help startups.