Northern start-ups have seen a remarkable financial upswing. In Q3, the region attracted a significant $49 million from venture capital investors, marking a considerable increase over the previous year.
This impressive boost reflects the North’s growing appeal to investors, driven by strategic investment across major cities and diverse sectors, thereby enhancing its economic landscape.
Investment Surge in Northern Start-ups
In an impressive development for the Northern business landscape, venture capital (VC) investors have channelled over $49 million into start-ups across the region from July to September. This figure marks a notable increase of nearly $10 million compared to the same period in the previous year, as highlighted in Venture Pulse 2018, a prestigious report on global VC trends by KPMG Enterprise.
Distribution of Investments Across the North
The VC investments in Q3 were strategically distributed across the North, fostering regional technological and economic growth. Key investment hubs included Manchester, Sheffield and Newcastle, which have emerged as central players in the Northern start-up ecosystem. The number of businesses benefiting from VC funding increased significantly year-on-year.
A total of 22 Northern businesses secured VC investments in Q3 2018, contributing to 200 deals completed nationwide. This boost underscores the growing attractiveness of the region’s burgeoning tech scene.
Key Players and Major Investments
Active investors like the Northern Powerhouse Investment Fund and Mercia Technologies played crucial roles, closing multiple multi-million-pound deals in Q3. These organisations are pivotal in accelerating the region’s economic dynamism.
The largest regional investment occurred in August, when Cheshire-based Blueberry Therapeutics received $13 million in late-stage VC funding, highlighting the financial confidence in advanced therapeutic innovations.
Investments were also notable for companies like Parckcloud in Manchester, Econic Technologies in Tyne and Wear, and Duffel in Sheffield, reflecting a diversified portfolio of funded sectors.
National Trends and Northern Alignment
Nationally, Q3 saw £1.41 billion invested into UK start-ups, a rise from the £1.31 billion recorded the previous year. The Northern region mirrored this national trend with a significant rise in funding volume and activity, demonstrating robust alignment with broader UK investment patterns.
Graham Pearce, KPMG’s head of technology in the North, remarked on this achievement against the backdrop of Brexit uncertainties. He emphasised, “With thousands of new tech companies born each year across the North, the sector is now a crucial component of the wider regional economy.”
Sectorial Focus and Future Outlook
According to Venture Pulse 2018, key investment areas include FinTech, automotive, and biotech, with particularly strong momentum in HealthTech. Newcastle-based Newcells Biotech secured a remarkable $7 million, reinforcing the North’s prowess in biotechnological advancements.
The digital maturity of the NHS and the proximity to world-class universities continue to strengthen the North’s healthcare sector, enhancing its appeal to investors. This sector is projected to remain a significant part of the region’s tech community.
Driving Forces and Economic Impacts
Major investors like the Northern Powerhouse Investment Fund are instrumental in underpinning regional economic growth and innovation. Their investment philosophy aligns with creating a sustainable and tech-driven future for Northern England.
The support from active investors is crucial in raising the region’s profile on the international stage, attracting further investments, and stimulating local economies by fostering a fertile ground for start-up growth and development.
Cheshire’s Blueberry Therapeutics Sets a Precedent
The substantial investment in Blueberry Therapeutics exemplifies the North’s potential to host groundbreaking innovations. Such financial backing provides companies with the necessary resources to advance their research and development, paving the way for breakthroughs in therapeutic solutions.
The Northern region’s success in attracting increased VC investment underscores its strengthening position as a vital hub for innovation and technology. Looking ahead, the momentum experienced in Q3 is expected to persist, bolstering the North’s economic landscape and inspiring confidence among investors.