The venture capital funding landscape in the UK encountered a significant downturn in the first half of 2025 with a decline in both deal volume and value compared to the same period in H1 2024.
The first half saw a 14% fall in VC deal volume compared to H1 2024, while there was a year-on-year (YoY) decline of around 12% in corresponding deal value, according to data and analytics firm GlobalData.
Aurojyoti Bose, Lead Analyst at GlobalData, said: “The trend underscores the challenges faced by UK startups in attracting investments. This decline in activity is indicative of the cautious approach that investors are taking amid economic uncertainties and challenging market conditions.
“While this downturn may raise concerns about the future of its startup ecosystem in an increasingly competitive global environment, it is also important to note that the decline in the UK’s VC funding mirrors patterns observed in other major markets.”
For instance, the US, while still leading in both deal volume and value, experienced a YoY reduction of 4% in VC deal volume. China, which ranks second, also saw a notable decline in both metrics, with deal volume dropping by approximately 6% and deal value plummeting by over 40% in H1 2025 compared to H1 2024.
Bose added: “Despite the challenges, there are promising signs within the UK VC ecosystem. Certain sectors, particularly technology and healthcare, continue to attract investor interest, indicating that opportunities for growth still exist.”
Some of the notable VC funding deals announced in the UK during H1 2025 include $600 million raised by Isomorphic Labs, $411 million secured by Verdiva Bio, $300 million funding raised by Rapyd, and $200 million raised by CMR Surgical, among others.
Despite the drop, the UK remains a significant player in the global venture capital ecosystem and continues to rank among the top five markets in the world.
According to GlobalData, the UK accounted for around 7% of the total number of VC deals announced globally in H1 2025 while its share of the global deal value during the period stood at around 4%.
