Scottish venture capital investment hits £181m in first quarter

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Venture capital investment in Scottish businesses reached £181m in the first quarter of 2022, compared to £64m raised in the same period last year.

The last KPMG Venture Pulse Survey showed that 41 deals were completed in the first three months of the year.

In the previous quarter, 31 transactions worth £97.6 million were recorded. Last year, a total of £626 million in venture capital investment was raised by Scottish companies.

The lion’s share of Q1 2022 deals were with Edinburgh-based companies (20), followed by Glasgow (11), Dundee (4) and Livingston (2).

Exceptional deals completed in the first quarter include the £94m raised by Edinburgh game developer Everywhere, £12.25m of fourth-round funding for private bank Hampden & Co and £5.07m of raised by Glasgow-based Katrick Technologies from Greenbackers Investment Capital.

While the bulk of venture capital investment continued to flow into London (£5.2bn), the rest of the UK also saw sustained levels, with over £1.7bn sterling invested in 334 deals, according to data compiled by PitchBook.

Venture capital investment in businesses based outside of London has more than doubled since the pandemic – up 59% from the £3.3bn invested in 2019.

Amy Burnett, Senior Director of Private Enterprise at KPMG in Scotland, said: “Despite concerns over uncertainty in the economy and rising interest rates, Scotland continues to show resilience and resilience. adaptability to attract investment, with fintech, B2B-oriented services and health technologies. upper areas.

“The ability of our disruptive companies to deliver impact on a global scale is greater than ever, and our innovators are a true success story – the collective focus on nurturing and supporting the upscaling ecosystem he Scottish scale is great to see.

Jonathan Boyers, UK Head of Corporate Finance and Vice Chairman of KPMG, added: “Given some of the current geopolitical and macroeconomic uncertainties, we are seeing the speed of transactions starting to slow as investors make more due diligence on potential transactions.

“We are already starting to see IPO levels decline, and expect activity to remain subdued in the second quarter of 2022 with continued volatility in capital markets.

“The closing of the IPO window could rekindle interest in traditional M&As and the downward pressure on valuations could prompt companies to adopt a wait-and-see approach in the hope that valuations rebound.”

KPMG UK also announced that it has signed an agreement to form a partnership with venture capital consultancy Acceleris.

Through the joint venture, called KPMG Acceleris, the companies plan to provide fundraising and advisory services to entrepreneurs in the UK and overseas, with a particular focus on businesses in the technology, life sciences and sustainability.

It will also give entrepreneurs access to an active pool of investors to support investments of £1m to over £30m.

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