"Last year we predicted strong M&A activity for venture-backed businesses, and we were proven to be correct. We had anticipated that this increased exit activity would reflect a decrease in investment, particularly at later stages. However, despite a cautious first half of 2024 (albeit stronger than 2023), investors have shown significant signs of optimism in the second half of the year and investment activity has remained steady over the full period when compared to the previous year.
A slower market over the last couple of years, following bumper years of fundraising, sees investors keen to deploy remaining funds and competition for investment in popular areas such as generative AI, healthcare and financial services, is gaining momentum. With the world increasingly focused on sustainability, businesses in this area are also seeing increased interest.
M&A activity continues to be strong, and we work closely with investors to identify ways to support their portfolio companies as they steer towards an exit, ensuring the process is as smooth as possible and optimising valuation.
Geographically, although most VC investment for UK companies comes from Europe, the US remains a significant contributor to the UK venture capital market and our US VC capability enables us to seamlessly advise on these investments. Within the UK, although London remains the dominant hub of investment, Cambridge and Oxford represent significant proportions of the UK VC market and have delivered notable growth over 2024 as the investment ecosystem in these regions support many of Europe's most promising entrepreneurs and knowledge intensive businesses."