Bumper year for start-up backers as exit value hits £26.7bn
Investors in UK start-ups saw a bumper year of exits last year with total value topping a record £26.7bn, as smaller firms roared back into growth mode after a pandemic slowdown, according to fresh data.
There were 781 exits from UK high-growth firms last year, over five times the number seen in 2020 when dealmaking slowed and firms held back from floating on public markets, according to a report from Triple Point Ventures and research firm Beauhurst.
Of the 781 exits, 732 came via acquisitions while 49 floated on public markets as appetite for IPOs surged on 2020 levels, rising 308 per cent on the previous year.
The boom in IPOs came as the government looked to overhaul the listing regime to encourage more firms to come to market, with a number of new measures being introduced last year following a major review of the regime by Lord Hill.
Exits for investors in B2B firms led the charge in value, with total exit value topping £302m, while exits for consumer facing firms hit £119m.
Bosses at Triple Point said the figures showed UK startups underlined the long term sustainability of smaller firms in the UK.
“This research shows the UK startup community bounced back phenomenally following the pandemic – but it’s the longer-term success story that’s most interesting to me,” said Seb Wallace, investment director.
“Over the past ten years, we’ve seen the UK startup ecosystem mature, with world-leading companies proving compelling to venture capital investors. Far more businesses have therefore gone on to become attractive IPO candidates or acquisition targets, culminating in these bumper figures.”
The exit figures reflected a post-pandemic surge of investment into UK startups and a dealmaking rebound last year.
Dealmaking globally hit record levels in 2021 with 3,791 across mergers and acquisitions in the UK alone, the largest number on record, according to separate data from accountancy firm BCW.
Venture capital investment in UK startups boomed meanwhile, with total value hitting $32.9bn in 2021, up from $12.8bn in 2020, according to data and analytics firm Global Data.