UK business investment by private capital soars by 44 percent
The surge in private equity and venture capital investments in UK businesses exploded by a whopping 44% last year! Instead of just relying on the bustling city of London, investors are spreading their cash across the nation, and that's a fantastic thing, mate!
Last year alone, a staggering £29.4bn poured into UK businesses, compared to a mere £20.4bn in 2023. Brace yourselves, because the British economy is about to reap some serious benefits, as private capital now contributes almost £200bn annually, that's approximately seven per cent of the country's GDP. And that's just the beginning!
Almost 90% of the almost 1,600 businesses that received private capital investment last year were small to medium-sized enterprises. It's like the national Business Boost Bonanza! And guess what? Over 2.5 million jobs are now supported by private capital, up from 2.2 million in 2023. More jobs, more growth, and less London-centric, cheers to that!
The proportion of businesses that received investment outside London is slowly but surely increasing. While 42% of the businesses invested in were still inside London, that's a far cry from the past. So,London Brexit, is this what you're all talking about?
Other parts of England have seen an influx of private capital. For instance, the East of England saw a massive leap, with the investment soaring from £1.3bn to £4.7bn in a single year, all thanks to support for tech and communication firms. The Northwest also experienced a significant increase, as investment surged from £885m to £2.3bn, with more than half of the funding directed towards biotech and healthcare firms. Meanwhile, the Southwest saw investment jump from £717m to £2.2bn.
Michael Moore, the chief exec of the British Private Equity and Venture Capital Association, expressed his delight at this trend: "This industry's investment touches every nook and cranny of the United Kingdom, helping businesses in the nations and regions to enjoy similar opportunities for growth as their counterparts in the capital." But, he warned, "To continue this level of investment, it is crucial that the government maintains the UK as an attractive destination for private capital investment, especially in these uncertain times."
Oh, and don't forget about the UK and Ireland cluster, which outshined many regions in European venture capital fundraising during Q1 2025. Clusters like Cambridge (life sciences), Oxford (biotech), and Manchester (advanced materials) are major players in this game, securing massive funding rounds up to $100M+. And let's not forget about the 70% of European VC funds involving emerging managers, including many from the UK, which often signals the growth of regional ecosystems targeting underserved geographies. Game on, financial warriors!
- The increasing influx of private capital in regions outside London, such as the East of England, Northwest, and Southwest, is enabled by venture capital and private equity investments.
- The technology sector, including tech and communication firms, has benefited significantly from this regional surge in private capital investment, particularly in the East of England.
- Biotech and healthcare firms in the Northwest have also experienced a boost due to private capital investment, contributing to a significant increase in investment in the region.
- The British economy could potentially see further benefits as private capital investment continues to spread beyond London, a trend that could be facilitated by government policies maintaining the UK as an attractive destination for private capital investment.
