Last night, 100 founders, investors and ecosystem leaders gathered to launch the 2025 South West Equity Investment Report at techSPARK’s Annual Investment Review.
Powered by techSPARK and supported by headline partner TLT, alongside British Business Bank and Link Stone Advisory, with thanks to Rathbones, the event enabled those in attendance to learn the key trends in the South West Investment landscape through insightful presentations and the release of the 2025 Annual Report: South West Equity Investment
The headline figure is striking. In 2025, £1.47 billion was raised by companies across the region, up from approximately £600 million in 2024. On the surface, that suggests a market accelerating at pace.
As the discussion quickly revealed, the reality is more complex.
A Strong Headline, A Distorted Picture
Presenting the regional overview, Ben Shorrock unpacked the numbers behind the headline.
While total investment has more than doubled year on year, a significant proportion of that growth is concentrated in a handful of large transactions. The top three raises accounted for approximately £600 million of the £1.47 billion total. The top seven deals together represented around £800 million.
Remove those outliers and a different pattern emerges.
Deal volumes have remained broadly consistent. The number of transactions is not dramatically increasing, but average deal size has edged up, from around £1.8 million last year to approximately £2.1 million this year. That represents an increase of roughly 10 to 15 percent.
Nearly half of all deals continue to take place in Bristol and Bath, reinforcing the West of England’s position as the investment capital of the South West. Beyond that, the regional distribution of activity remains relatively stable compared to previous years.
The conclusion is not that the market is overheating, but that it is holding steady, with occasional large raises shaping the overall picture.
In a national context, that steadiness matters.
The UK Backdrop: Fewer Deals, Tighter Liquidity
Henry Whorwood from Beauhurst set the South West data against the broader UK landscape.
Since 2011, Beauhurst has tracked nearly 35,000 high growth companies across the UK, capturing around 90,000 equity deals worth over £260 billion. The median deal size nationally is £218,000, clustered around early stage SEIS rounds.
The national trend over the past year has been more subdued.
Across the UK, deal numbers are trending downwards from pandemic highs. Investment totals appear flatter, but once inflation is considered, the picture is weaker than it first appears. Valuations at seed and venture stage have softened, and liquidity remains constrained.
There are positive signals. First time fundraises have shown recovery, driven in part by AI focused businesses. Around 2,200 unique investors are active in the UK market in 2025, indicating continued engagement from capital providers.
However, a structural challenge remains. There are now approximately 22,000 venture backed companies seeking further funding or an exit, the highest level recorded. Exit activity through M&A or IPO needs to accelerate to recycle capital and rebalance the system.
Against that backdrop, a South West market that is stable, rather than declining, represents relative strength.
Performance against a challenging national environment is not something to overlook.
Cyber: A Regional Specialism with Momentum
Chris Hill from SETsquared highlighted one of the region’s strategic strengths: cyber.
The UK cyber security sector remains substantial, and the South West accounts for around 8 percent of national cyber activity. That share is significant, and maintaining it is critical.
SETsquared’s work in recent years has focused on supporting very early stage deep tech and cyber businesses, particularly around investor readiness. That means equipping founders with the right materials, expectations and networks before they enter formal fundraising processes.
The challenge is less about talent and more about connection. The South West has capable founders and engaged investors. Ensuring they meet at the right time, with aligned expectations, is where programmes like this make a difference.
Silicon Gorge: Nearly £1 Billion Raised and Evolving
The evening also reflected on the impact of Silicon Gorge, techSPARK’s investor showcase competition.
Over 200 companies have progressed through the programme since its inception. Collectively, those alumni businesses have raised close to £1 billion, with several achieving significant scale or exit outcomes.
Entering its eleventh year, Silicon Gorge is evolving. The competition will now run in two streams: Catalyst for businesses raising under £1 million, and Velocity for those raising over £1 million. Semi finals will take place during Bath Digital Festival, with the investor showcase final scheduled for 24 June.
The message to founders was clear. If you are raising, or planning to raise, this is a structured pathway into the regional investor network.
To close the evening, Bryony Phillips spotlighted 20 companies currently raising capital across the region.
The range was broad: AI driven financial platforms, rapid molecular diagnostics, next generation probiotics, wearable cooling technology, infant monitoring, digital power of attorney platforms, in ear biometric sensors, AI enabled animation tools and more.
Some companies are raising £60,000. Others are targeting £20 million. Several have already secured term sheets, grants or partial commitments.
The breadth of sectors, from life sciences to fintech to sports technology and neurodiversity support, reinforces a key theme of the evening. The South West’s strength lies not in one vertical, but in diversity and depth.
A Region That Holds Its Ground
The 2025 Annual Investment Review did not present an unqualified growth story. It presented a grounded one.
Yes, £1.47 billion was raised. Yes, average deal sizes are up. But those gains sit within a national context of reduced deal volumes, tighter liquidity and valuation pressure.
What stands out is resilience.
The South West is maintaining its share of activity, sustaining a strong pipeline, and continuing to generate companies capable of raising at scale. In a year when many markets are contracting, holding steady is itself a signal of health.
The work now is to build on that foundation: increase transparency, strengthen investor confidence, improve pipeline visibility and ensure capital continues to flow into regional businesses.
The full South West Equity Investment Report 2025 is now available to download. It provides detailed breakdowns by geography and sector, alongside data on who has raised and where momentum is building.
For founders, investors and policymakers alike, the message is the same. The South West is not just participating in the UK innovation economy. It is holding its own.
And in this climate, that is worth paying attention to.
Get a clear view of equity investment across the South West in 2025 by clicking here.