Good financial news is becoming a rarity these days so it's excellent to hear that British high-tech VCs didn't flinch during the year. Up to the end of Q3 they'd put £765 million into UK and Irish high-tech start-ups which, if Q4 was going to be normal which it probably won't be, would see the year closing out at £1 billion which is about the same as recent years.
"Against a backdrop of rapidly declining economic indicators, the banking crisis and general uncertainty this is much better than we expected," says Stuart McKnight, CEO of Ascendant, the technology investment group which compiles stats on the
The big deals this year have been Plastic Logic (£25m); Miniweb Interactive (£18m); G24i (£15m); Fleetmatics (£13m); PCH International £12m); Nujira (£10m); Enqii (£10m); Intelligent Energy (£9m); Secerno (£8m); Mydeco (£7m).
"The first half of 2008 went very well for UK/Irish technology companies raising venture capital", adds McKnight, "in the 3rd quarter, the value of funds invested dropped by 5 per cent to £208m."
Is this a sign of softening? Maybe. Also there's been a shift from first round financing to second and third round financing. Is that another sign of softening? Maybe.
But McKnight's figures show one thing: So far so good. And that's as good as it gets in these angst-ridden times.
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Comments (2)
Last year I did about 12 VC due diligence jobs on semiconductor startups in the UK, this year it has been 1. VC funding of fabless semi companies has stopped dead - except for follow on rounds to support existing investments. Some of these are quite big because the companies are late stage and in normal times would be heading towards acquisition or IPO. The big rounds are not a healthy sign.
Posted by Tom | November 25, 2008 11:30 AM
Posted on November 25, 2008 11:30
Thanks Tom. Good point. Stuart McKnight of Ascendant, which did the stats, did point out that the emphasis had switched from 1st round to 2nd and 3rd round funding, but I had no idea the switch was so dramatic.
So what we need is a massive IPO of a UK start-up, or a trade sale, to encourage the VCs. But i can't see where that's going to come from.
Posted by David Manners
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November 25, 2008 11:41 AM
Posted on November 25, 2008 11:41