KMPG Venture Pulse report: East bucks the trend in Q1 as venture capital funding increases

Venture capital investment in the Tech Corridor shot up in the first quarter of the year, with start-ups in the region attracting £125m of fresh funding.

So says the latest Venture Pulse report from KPMG Enterprise, which provides a snapshot of VC activity in the UK. It reveals that 19 deals with a total value of £125m were closed in the period between January-March this year. That compares favourably to 12 deals worth a total of just over £36m in the corresponding period last year.

Significant investments included the £39.8m of Series B venture funding for liquid biopsy pioneer Inivata, which will be used by the company to advance the US commercial roll-out of its InVisionFirst-Lung liquid biopsy test and to accelerate the development of the InVision liquid biopsy platform into new areas to drive the future growth of the company.

Other deals included the £25m cash injection into AI-powered fraud fighters Featurespace, which will use the funds to support international expansion and continued development of its software capabilities as well as supporting the continued distribution of its ARIC platform, as well as £18m of Series A venture funding for Wren Therapeutics.

"Strength and diversity of our ecosystem"

Mark Prince, head of enterprise at KPMG in Cambridge said: “The increase in the levels and value of VC funding in the region is testament to the strength and diversity of our startup ecosystem which keeps investors coming back.

“FinTech, biotech, and healthtech continued to drive a significant amount of the VC investment in the region, highlighting the resilience of these industries.

“The region’s particular strengths in biotech and healthtech bode well for the future with investment in both areas expected to stay strong this year as well as the growing area of health focused insurtech. Hopefully strong investment levels into the region will continue, particularly once the uncertainty of Brexit has been resolved.”

The boom in the Eastern region was in stark contrast to the national picture, where VC investment was flat year on year at $1.56 billion. The money was raised across 161 deals – down 57 per cent on the same period in 2018.

Read the full report here.