Venture capital investors in London are thrilled at the arrival of the world’s biggest ever tech investment fund and the decision to locate it UK’s capital. Just last week, Softbank unveiled plans to create a huge new fund for investing in technology companies along with the Saudi Arabian sovereign wealth fund of a whopping $100bn (£820bn) over the next five years.

The fund, overwhelming (not to mention awe-inspiring) in its size, is expected to help plug a late stage funding gap for startups across Europe, to the benefit of both startups and the UK’s VCs. The ambitious plan, with a working title of the ‘Softbank Vision Fund’, has been announced even as tech investors continue to pour record amounts of money into firms like Uber Technologies Inc., the world’s most valuable startup at $68 billion.

SoftBank has also been stepping up its deal pace, pouring more than $45 billion into technology investments alongside co-investors over the past two years, and putting its overseas investment operations into a separate unit earlier this year. Locating the fund in London has been welcomed as a vote of confidence in the UK technology sector post-Brexit. According to the Financial Times, it will be led by Rajeev Misra, SoftBank’s head of strategic finance.

Tech London Advocates’ Russ Shaw, in a statement to the BBC, said:

This is a very interesting and strong vote of confidence in the tech sector here. It demonstrates that regardless of whether we’re here in the EU or not , it’s showing some really strong fundamental signs – it’s vibrant, it’s dynamic and it’s here to stay.

Suranga Chandratillake, general partner of Balderton Capital, said:

The injection of capital into the market will help Europe’s ambitious entrepreneurs to fulfil their ambitions on home turf, rather than being constrained by a lack of later-stage capital.

Hoxton Ventures’ Rob Kniaz said:

It’s not worth their time to do a paltry cheque under $10m or $20m to be frank. So we’re delighted they can follow in later rounds of our companies.

Softbank acquired UK chip maker Arm for £24.3bn over the summer in an unexpected mega-deal, and is already an investor in two of Hoxton’s companies, Yieldify and Darktrace, which is now valued at $500m. Well-known investor with LocalGlobal Robin Klein, who backed Zoopla and LoveFilm, said:

I think all round, the fact that a global fund of this size will be based in London is huge for London and Europe. It is a very good endorsement for the importance of tech in the global economy.

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