December 2nd, 2020 / Insight posted in

Technology sector benefits from improving growth capital environment

Growth Capital Update: Spotlight on the technology sector

According to our research into UK private companies raising between £1 million and £20 million of growth equity capital each, 206 British businesses raised £982 million of growth capital in the third quarter of 2020. The Q3 figures for the overall growth capital market revealed a 28% quarter on quarter increase in the number of deals completing and a 26% increase in the amount of growth capital being raised.

This significant increase in activity was underpinned by a new UK government initiative to support direct equity investment in high-growth, innovative firms across the country. The Coronavirus Future Fund, launched in May and extended in June, has helped secure more than £320 million in investment.

The technology sector has largely kept pace with this general increase in activity with 136 deals completed in Q3, up 23% on Q2. In aggregate, £608 million of growth capital was raised for technology deals, an increase of 14% on the previous quarter. Its overall share of the growth capital market held up very well with technology deals making up almost two thirds of all deals completed.

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