Whether it’s listings moving abroad, investment flowing elsewhere, or the drumbeat of negative news reports claiming London is “falling behind,” the story we hear too often, is one of decline. Nowhere is that louder than in the AI race.
But as the founder of an AI start up, right here in London, I completely reject these gloomy assessments. While it’s easy to fall into self-declinism, the reality on the ground is very different. London isn’t chasing California - it’s competing with it. Silicon Valley’s record incubating startups into global giants is undeniable, but London is now the only city that truly rivals it.
London’s strength isn’t one single factor but the combination of them all.
Nowhere else brings together talent, world-class research, a thriving startup scene and deep financial muscle in quite the same way. It’s the intersection of academia, investment and application which makes London one of the most exciting places on earth to build in AI.
Our capital is home to some of the world’s best universities. UCL and Imperial rank among the global top ten, producing a steady stream of talent. Many of those minds don’t just publish papers - they spin out companies, drive growth and spark the next wave of innovation. That concentration of academia and ambition has created a talent ecosystem where ideas move from concept to market in weeks, not years.
London’s financial firepower gives it an edge few cities can match. Ranked just behind New York as the world’s second most powerful financial centre - and nearly twenty points clear of Frankfurt and Geneva - the City remains Europe’s beating economic heart. It’s packed with investors, global corporates and clients who not only talk innovation, but actually know how to back it.
That mix of finance, business and research makes the capital one of the easiest places on earth to get things moving. You can test an idea with a major retailer on Monday, pitch investors on Tuesday and hire PhD talent from UCL or Imperial by Friday. Nowhere else offers that kind of pace and proximity - to money, to markets, to minds. It’s what keeps London in a league of its own when it comes to building the next wave of AI companies.
I saw that potential first-hand when I started Electric Twin in 2023 after leaving Downing Street. We build synthetic audiences - digital personas that model real-world behaviour - so organisations can test strategies before making decisions. The idea only worked because London had the right mix: research talent to build it, investors willing to back it and clients ready to try it.
To make that work, you need collaboration, technical excellence and investors ready to support complex ideas. London is one of the few places where all of it exists within a few Tube stops - an ecosystem that rewards ambition and experimentation over scale.
Critics often point to the UK-US gap in scale and capital, but London’s real advantage is agility. Startups here are closer to regulators, policymakers and one another, so innovation is faster. When the UK hosted its AI Safety Summit, the result wasn’t bureaucracy - it was credibility. London is becoming a hub not just for AI development but for AI governance. In a rapidly moving sector, that balance of innovation and oversight matters.
None of this is to say London has completely cracked it. Access to late-stage capital remains a challenge and regulation still needs to move faster. But the foundations are solid.
With 1,600 AI startups in the capital, billions in AI investment and a government backing data as a national priority, London has everything it needs not just to compete, but to lead.
Truth is, there’s no other city outside Silicon Valley that combines academic excellence, creative energy and financial firepower in quite the same way. Berlin has talent, Tel Aviv has innovation, Singapore has capital - but London has them all, in one place.
For the next generation of AI founders, that’s what matters. It’s not about chasing Silicon Valley. It’s about building something different - something global, inclusive and distinctly British. And if you’re building in AI, there’s no better city in the world to do it.
Dr. Ben Warner, is a former Downing Street Chief Data Adviser and Co-Founder of Electric Twin
