Wednesday 22 December 2021

*UKHotViewsExtra* Venture Capital can reap the rewards of greater diversity

graphicAt TechMarketView we are always delighted to report on the continued growth of Venture Capital (VC) investment into UK and Irish tech companies. Subscribers to our Foundation Service and HotViews Premium streams can read our full analysis of Q3 2021 Venture Capital in UK and Irish tech here, with data supplied by Corporate Finance firm Ascendant. At a headline level, Q3 2021 saw a slight dip QoQ on the record-breaking Q2 - but Q3 deal volume was still up 35% and aggregate value up a massive 230% on the equivalent figures in Q3 2020.

However, what is also clear is that the boom in VC funding is not evenly spread. The recent State of European Tech report by VC firm Atomico, covering venture activity in Europe (including the UK), celebrates the growth in VC investment right across the continent, which is now starting to rival the more established US venture ecosystem. However the report also points out numerous inequalities in access to that investment, highlighting concerns of many entrepreneurs who do not believe that the system has made progress when it comes to providing opportunities to individuals so far under-represented.

The data-set supplied to us quarterly by Ascendant covers investment into UK and Irish tech only. It does not track data by founders or management but does showcase the continued heavy focus of UK VC investment into London start-ups, with the capital accessing on occasion as much as three quarters of all UK and Irish tech VC value.

UKHotViewsExtraThis lack of diversity in geography, gender and other measures matters because VC investment will never achieve its full impact as long as all founder and management groups are not appropriately represented. Innovations will never make it to market and entrepreneurs will leave the innovation economy and never become the role models that the next generation needs to inspire them in turn to pursue careers in tech. Given the enormous transformative potential of VC, that would indeed be a disappointing outcome.

We explore this in more detail in HotViews Extra, which is available to all subscribers including HotViews Premium readers.

Posted by Tania Wilson at '19:43' - Tagged: funding   startup