The value of venture capital investment into UK businesses continued to slump in the opening quarter of 2023 falling to £2.9 billion ($3.6bn) continuing the significant slowdown seen at the end of 2022, according to KPMG’s latest Venture Pulse report.
The value of venture capital (VC) investment into UK businesses continued to slump in the opening quarter of 2023 falling to £2.9 billion ($3.6bn) continuing the significant slowdown seen at the end of 2022, according to KPMG’s latest Venture Pulse report.
The report, which uses data compiled by PitchBook, highlights that total VC investment in Q1 2023 is the lowest raised by UK businesses in the opening quarter of a year since 2020 and significantly down on the £8.2 billion ($10.2 billion) and £12.3 billion ($15.2 billion) raised in the same quarter of 2021 and 2022, respectively.
Deal volumes were also muted with just 402 deals captured in the data.
Two-thirds of VC investment (£1.9 billion/$2.4 billion) coming into UK businesses in the opening quarter of this year flowed into London, with more than half of the deals completed (219) by businesses based in the capital.
A $602 million raise by fintech player Abound (Consumer Finance) was the UK’s largest deal of Q1 2023, followed by a $160 million raise by B2B focused fintech the Bank of London, a $149 million raise by EV automotive company One Moto, and a $140 million raise by autonomous vehicle software firm Oxbotica. Carmoola rounded out the largest of deals with a $126 million series A deal according to the data. Five of the largest completed deals in Europe during Q1’23 were UK based.
From a sector perspective, business services and energy transition continued to attract significant attention from VC investors in Q1’23, while interest in consumer retail and real estate remained dry. Looking forward, B2B technology enablement is likely to remain a key driver of investment, not only in areas like financial and health services but across every sector.
