East of England venture capital investment up 61% in Q4, KPMG finds

£480.5 million of venture capital (VC) investment was raised by businesses in the East of England between October and December last year – a strong increase of 61% from the £300 million raised in Q3, according to KPMG’s latest Venture Pulse report.

Forty-eight transactions were completed across the region, up from 33 in the previous quarter, with Cambridge leading the charge, where exactly half of the region’s VC deals were completed.

Life sciences businesses drove the majority of activity in the East of England with almost £150 million invested into a total of 18 healthcare, pharmaceuticals and biotechnology companies during the quarter.

Investment into business products and services and IT sectors remained strong, receiving £60.3 million and almost £40 million in VC backing respectively.

This latest report comes just weeks after KPMG released the findings of its KPE Barometer, which found that more than a fifth (21%) of the East of England’s private business owners see venture capital as a means to finance business diversification this year.

Joe Faulkner, East Anglia Senior Partner at KPMG UK, said: “It’s great to see venture capital investments are up on the already high levels of the previous quarter.

“Cambridge continues to be the jewel in the crown of the East of England’s outstanding life sciences development cluster, playing an integral role in a thriving VC ecosystem and driving forward the advancement of the healthcare sector.

“We’re excited to see the growth of the East of England’s most promising private enterprises in 2025, especially those that make the most of VC funding to pursue expansion.”

The national outlook

The UK attracted the highest level of VC investment in Europe in 2024, following a strong end to the year.

The UK raised a total of £15.5 billion VC investment after funding in Q4 jumped by more than a third from £3.1 billion to £4.4 billion. This was driven largely by $1.3 billion raised by Greenscale, a London-based AI data centre firm. A total of 569 businesses made up the £4.4 billion investment, including £409 million raised by Insider and £303 million raised by Lighthouse.

These results come just weeks after KPMG published its first ever KPE Barometer, which revealed that over 90% of Britain’s private business owners are confident of growth in 2025.

Nicole Lowe, UK Head of KPMG’s Emerging Giants practice, said:

“After a difficult Q3, it’s great to see the UK end the year as the top destination in Europe for VC investment.

“The strong rebound in Q4 has boosted optimism among investors looking ahead to the rest of 2025, with AI likely to remain at the forefront of those looking to invest.

“However, the impact of both global and domestic events such as the UK Budget measures and the new US President taking office could still contribute to a level of investor caution.”