EV batteries are a £2bn business – attracting the largest VC investment of ANY sector since 2018

Electric batteries might cause environmental debates, but the economic positives seem to be a done deal.

UK-based EV battery start-ups have received over £2billion in venture capital (VC) investment since 2018, a new report has found.

As a result, Britain is now the fourth largest recipient of EV battery investment in that period.

A report by the UK Research and Innovation’s (UKRI) Faraday Battery Challenge found that 2023 was a particularly well performing year, with homegrown EV battery start-ups receiving £1billion of private investment.

With £2.1billion of investment in six years the UK is now only behind the US, China and Sweden in terms of investment growth in this sector.

The Faraday Battery Challenge alone has raised £770million in VC investment in 2018.

The report also found that global EV battery VC funding has risen thirty-fold over the past decade, with global EV battery VC funding reaching £6.1billion in 2023.

Specifically, the top VC investment segment in the UK in the last six years is EV battery recycling and second-use which accounts for nearly £1billion (£940million) raised.

This VC investment is also good news for UK jobs, with nearly half of British EV jobs having been created by start-ups founded in the last 10 years.

Thomas Bartlett, of Faraday Battery Challenge, said:  ‘The global EV battery ecosystem is accelerating at an unprecedented pace, attracting record-breaking investments that are leading to increasing innovations and success stories. 

‘The UK’s own EV battery ecosystem is reaping the benefits of this boom, as we have seen Faraday Battery Challenge-funded start-ups and scale-ups raise over $1.6billion in VC funding since 2018. 

‘The bulk of this investment has been made in the last two years alone, suggesting that demand to invest is only getting stronger.’