Venture capital investment fell by 30% in North West last year

Venture capital funding in the North West fell by 30% last year – according to a new report.

Businesses in the region received £226.55m in venture capital investment in 2018 across 100 deals, according to the Venture Pulse report published by KPMG.

With investors demonstrating greater caution there was a 30% year-on-year drop in venture capital funding for the region’s businesses, down from £327.33m in 2017.

In total, £7.7bn was invested across the year in the UK by global and domestic VCs, a four per cent fall in comparison to the previous year.

The North performed better in terms of the number of deals – there was a 14% drop compared to the UK average of 25%.

The overall reduction in northern investment was felt most keenly in Yorkshire where VC interest fell by 69 % to £40.4m, and the North West, where the value of overall investment declined from £173.4m to £122.2m – a 30% difference.

Graham Pearce, KPMG’s head of technology in the North, said: “The North remains a fertile and active market for venture capital but investors appear to be keeping their powder dry as they wait for trading conditions to become clearer, particularly given the risks when working with early stage businesses.

“Our report indicates that there is still a healthy appetite from seed through to later stage investment, particularly with IT and healthcare businesses, as northern research hubs continue to perform highly.

“As such, the region should strengthen its resolve to prosper in 2019 even if investors remain shy in the first half of the year.”