Growth Capital Update Q1 2020 – Investors still keen to deploy capital amidst market uncertainty
According to our research into UK private companies raising between £1 million and £20 million of growth equity capital each, 180 British businesses raised £927 million of growth capital in the first quarter of 2020: an average deal size of £5.15 million.
This representative deal size compares reasonably favourably with the final two quarters of last year, where the average was £5.22 million in Q3 2019 and £5.18 million in Q4. In our experience, there is a seasonal aspect to transactions completing in the UK – Q1 is normally a quieter quarter following the Christmas and New Year break – but nevertheless Q1 2020 appears to have been a little quieter than normal.
In Q1 2018, we recorded a total of 225 deals and in Q1 2019 219 deals, so just 180 deals in Q1 2020 appears to indicate a decline. It may be that this is the early signs of the Coronavirus affecting the growth capital market. Alternatively, it may be that while the UK is in lockdown, reporting of completed transactions takes longer so this might be an incomplete set of data. When we produce our Q2 update, we should be able to clarify the position.
Read more in our latest report.