George Gaprindashvili December 23, 2013
Venture capital investors have poured $1.8 billion of funding into U.K.-headquartered companies in 2013, PitchBook data show. Capital exited during the year has reached $2.2 billion. But which companies received funding, which firms provided it, and which sellers hit pay dirt? Most importantly, what trends emerged? Let’s dive into the year that was for the U.K.’s venture capital scene.
382 companies based in the U.K. have completed VC financings in 2013, as of Dec. 20. The IT industry has received the largest portion of the deal flow, accounting for 34% of all deals completed this year, followed by healthcare, B2B, B2C and energy. While deals in the IT industry have been primarily software-related (83% have fallen in the software category), deals in the healthcare sector have been more diverse. Roughly 50% of the U.K.’s VC healthcare deals in 2013 have gone to companies in the pharmaceuticals & biotechnology subsector, with 37% going to devices & supplies and 8% to technology systems. England’s B2B sector has grabbed an increasing share of deal flow in each of the last four years, more than tripling from 5% of deals in 2010 to 18% in 2013. The average deal size in 2013 has been $1.8 million, with the largest financing belonging to Truphone, a mobile communications company that raised $116.4 million in February.
VC investors have exited 53 British companies this year via acquisition, buyout or IPO. While, like last year, the exit of choice has overwhelmingly been acquisitions (accounting for 87% of all exits this year—91% last year), exits via buyout nearly tripled in terms of percentage from 4% to 11%. Capital exited in 2013 ($2.2 billion) reached its highest total since 2007 ($2.3 billion) and nearly doubled 2012’s total ($1.15 billion). This is the fourth consecutive year that the number of exits has grown from the previous year, more than doubling from 24 in 2009 to 53 so far in 2013. The largest exit of the year involved Ubiquisys, a communications device maker that was acquired in May by Cisco for $310 million.
375 VC investors have completed 406 deals in U.K.-based companies this year. The top investors of the year based on investment count are:
Correction: The article incorrectly stated that Kayak Software was the largest VC-backed exit in the U.K. this year. Kayak, which has a corporate office in the U.K., is not headquartered there. Ubiquisys was the largest VC-backed exit in the U.K.