North West region attracts £43m of venture capital investments in first quarter

Nisha Sharma, KPMG

Venture capital (VC) investments in the North West exceeded £43m in the first quarter of 2024, according to KPMG Private Enterprise’s latest Venture Pulse report.

Firms that attracted the largest investments in the North West include, AccessPay with a £19m ($24m) venture capital investment and the Insights Family with a £5.6m ($7m) investment. Both businesses are based in Manchester.

In 2023, there were a total of 114 VC investments in the North West worth more than £462m ($575.6m) combined.

Nationally, VC investment into UK businesses continued to slide in the opening quarter for 2024, falling to levels last seen in 2018.

Coming off the back of $4.9bn raised by UK businesses in the last quarter of 2023, just $3bn in funding was raised in Q1’24 – the lowest amount seen in 22 quarters.

Deal volumes were also down with the Venture Pulse report recording just 519 deals completed in the period, levels not seen since 2016.

While deal volume was very subdued, deal sizes remained quite healthy as VC investors focused their funds on the most promising start-ups.

Nisha Sharma, corporate finance partner at KPMG in Manchester, said: “With a subdued start to the year and ongoing economic uncertainty, it is clear that investors are still very cautious when it comes to where they’re putting their money.

“Early stage businesses in the North West that are looking to raise funds over the coming months will hope for greater certainty to encourage venture capital investment in the region, but for now, will need to face into higher levels of investor scrutiny over their business plans and strategies for a positive outcome.”

She added: “The good news is that deals are still getting done and there remains an abundance of capital to be deployed across the region for those with a clear value proposition. I remain hopeful that market activity will pick up in the following months.”

In March 2024, the Wired for Growth taskforce, led by KPMG Acceleris, was launched, to help North West founders navigate barriers and identify the opportunities that exist for start-ups.

Patrick Molyneux, Partner – Head of Products and Partnerships at KPMG Acceleris, said: “Wired for Growth presents a unique opportunity to take a holistic view of the ecosystem to help close the funding gap for founders.

“Listening to real experiences and taking that onboard with the expertise of business, academia, investors, governing bodies and advisors offers a proposition in the North West that has not yet been seen, and it sets an example for other regions to follow.”

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