Small venture deals increase

Investments in the sub-£1m market have increased 14% in 2005 up to August reports Venture Index, the UK’s first index which tracks investments in small and unquoted companies.

For the 12 months since August 2004, £42.6m has been invested in over 300 deals in the sub-£1m category the index is focused on. From January to August this year, the number of deals has risen by 14%, which, according to the index, indicates a renewed optimism at this end of the market, in contrast to the market for over £1m venture capital deals which has been weak. In terms of value, the current figure is a 10% increase on the low point of March 2005.

The results also show that London has lost its place as the most popular destination for venture capital in the UK. Peter Claydon, group commercial director of YFM Group said: “This latest update from Venture Index is pleasing as it demonstrates that confidence is returning to this end of the market in contrast to the downturn more established venture capital investors are reporting. Yorkshire features heavily as a regional hub in this latest update, overtaking London as the most popular place for investment in the last 12 months. Given that we, among others, are interested in backing growth companies wherever they are located in the UK we’re delighted to see regions outside London now competing for the ‘most active investment market’ title.”

Venture Index was founded in October 2003 by a number of UK VCs and angel investor groups, and is updated every quarter.