The value of venture capital deals and valuations in the UK in the third quarter of the year is pacing above 2023’s full-year figures, though the number of rounds appears to have dropped, according to a new report. 

The European VC Valuations report from PitchBook found that the venture capital market has shown a promising recovery from last year, as pressures from high interest and inflation rates have eased. 

Central banks have steadily cut interest rates over the past year, and with inflation largely falling towards target levels, there has been an “improved environment for dealmaking”. 

According to the report, this has also prompted a bump in the size of deals and valuations tied to rounds. 

Some of the biggest UK tech rounds in 2024’s third quarter include; women’s health app Flo’s £156m Series C, med tech firm Amber Therapeutic’s £78, Series A and robotic warehouse technology provider Dexory’s £60m Series B. 

In the UK and Ireland, Europe’s largest VC ecosystem, median pre-money valuations are pacing higher than last year at the pre-seed, late and venture growth stages in particular, though they have been flat at the seed stage and down at the early stage. 

Pre-money valuations at the pre-seed stage in the region averaged £3.2m, up 31% from the year before, while at the venture growth stage, the average was £16.8m, up around 5% from 2023. 

Valuations in the UK and Ireland have been slightly lower compared to the rest of Europe. The median European seed valuation in the third quarter of 2024 was £4.5m, while the UK equivalent was £4m. 

At the venture growth stage, the European average was £20.8m, while in the UK it was £16.8m.

PitchBook noted that: “The UK’s higher activity levels and wider dispersion of price points for deal sizes and valuations compared with other nations could be influencing medians.

“Nonetheless, the UK remains a robust benchmark and mirrors longer-term trends for European VC valuations.”

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