London led the way as new data showed billions of pounds-worth of venture capital investment in the UK in 2024 was the highest in Europe.
The UK raised a total of £15.5 billion investment after funding in Q4 jumped by more than a third from £3.1 billion to £4.4 billion.
This is according to the latest Venture Pulse report published by KPMG UK, part of a global organisation of independent professional services firms providing audit, legal, tax and advisory services.
KPMG’s Emerging Giants practice UK head Nicole Lowe said: “After a difficult Q3, it’s great to see the UK end the year as the top destination in Europe for VC investment.
“The strong rebound in Q4 has boosted optimism among investors looking ahead to the rest of 2025, with AI likely to remain at the forefront of those looking to invest.”
The report revealed how London played a huge role in this increase with venture capital investment in the city’s start-ups rising by nearly two thirds (61%) in Q4 to £2.9 billion, up from the £1.8 billion raised in Q3 of last year.
The 299 transactions were primarily fuelled by a billion-pound funding round for GreenScale, a London-based sustainable data centre platform.
KPMG UK London office senior partner Anna Purchas said: “London continues to cement its position as a global hub for venture capital investment, with Q4’s strong performance reflecting the capital’s ability to attract substantial funding despite ongoing economic challenges.
“The combination of investor confidence and a vibrant entrepreneurial scene makes London well positioned to support the UK’s drive towards much-needed growth in 2025.”
London start-ups with the highest investments
London’s IT and software sector has attracted substantial investment, with 124 businesses specialising in AI, machine learning, and augmented reality securing a combined £1.1 billion.
These developments align with the government’s recent unveiling of its AI Opportunities Action Plan, a roadmap designed to boost the country’s AI sector.
Meanwhile, London’s healthcare and life sciences sector also saw significant funding, with 38 businesses collectively raising £234 million.
This comes ahead of the London Growth Plan in March, which aims to revitalise the city’s economy by bolstering high-skill industries such as life sciences.
These results come just weeks after KPMG published its first ever KPE Barometer, which revealed that over 90% of Britain’s private business owners are confident of growth in 2025.
Picture credit: Free to use from Wikimedia Commons
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