Government and Private Sector Collaborate to increase access to scaleup investment

Whilst year-on-year deal volume has increased slightly at Series A, UK VC’s are increasingly selective about who they back, as founders’ confidence to raise growth capital remains low

London, 10 February 2026: Fewer than 500 UK companies raised a Series A round (£2-10m) in 2025, and only 110 raised Series B (£10-20m), highlighting the challenges faced by promising businesses as they seek scaleup funding, according to a new report from VenturePath, the platform that helps UK scaleup companies secure VC backing.

VenturePath coordinates The UK ScaleUp Investment Mission to align private sector investors (£13bn) and business support organisations with Government scaleup and investment interventions, after identifying that 93% of seed-funded startups are failing to secure follow-on funding to scale, with only 7% raising a subsequent VC round ( “Series A”).

Its latest research, The UK ScaleUp Investment Report was commissioned to analyse the drivers and solutions to these problems, and comprises scaleup founder and VC investor surveys. It highlights how the UK has all the ingredients to build world-leading businesses in key industries, but many potential scaleups continue to struggle accessing the capital and support to drive their development.

Working with 26 industry partners, including Sifted to research investor trends and Sage to collate founder sentiment, and with additional input at its launch from policy groups including UK Private Capital (formerly BVCA), EIS Association, techUK and Startup Coalition, the UK ScaleUp Investment Report was launched today at an event joined by Minister McDougall, Minister for Small Business & Economic Transformation.

Key findings from the investor data collated for this report saw:
– UK VC’s are increasingly selective about who they back with flat investment levels and around 70% of deals still anchored in London, whilst a majority of founders (83%) are not highly confident about securing scaleup venture capital at Series A and B.
– To bridge this gap, alternative financing is re-shaping the equity landscape, helping companies grow without diluting equity.
– Outside of a few large AI outliers, the average amount raised at Series A was £4.62m, and £14.5m at Series B – figures that have remained largely stagnant for the past decade.

Key findings from the founder sentiment surveys collated by Sage for this report saw:

– 63% of founders report high confidence in their ability to scale, despite only 17% reporting high confidence in their ability to secure capital.
– 84% of surveyed companies have less than 12 months of runway, and 27% report low confidence in their ability to secure capital.

The Government’s growth agenda led to policy changes including in the 2025 Autumn Budget to support UK scaleups;
changes to investment thresholds for tax incentives (EIS and VCT) and to the EMI scheme aimed at attracting and retaining key talent
the appointment of entrepreneurs as advisors and Ministers, and
increased engagement with private-sector initiatives such as the UK ScaleUp Investment Mission, coordinated by VenturePath.

The ScaleUp Investment Report also analyses these changes on a Government Department-by-Department basis, including the activities from the public finance institutions: British Business Bank and Innovate UK, to determine the likely impact on scaleups and where increased Government and private sector collaboration can further create more venture capital-backed scaleup successes.

Ian Merricks, Founder of VenturePath, said: “The UK ScaleUp Investment Mission is working to improve collaboration between the public and private sector to help create more venture-backed UK scaleup successes. This report shows that ambitious, smart and driven UK founders across the country continue to back themselves and their businesses. But the UK investment landscape remains inaccessible to 93% of them. Capital is not the problem; rather, it is access to capital and readiness to scale more quickly with VC backing. The Government plays a key role in enabling more future scaleups to grow with venture backing, especially when private capital can complement or even replace public funding and support. The UK ScaleUp Investment Report shows some positive recent moves from the Government, but clear opportunities exist to go further and faster to help UK entrepreneurs realise their full potential on a global scale, with at least initially, improved access to domestic capital and UK-wide scaleup support”.

Blair McDougall, Minister for Small Business and Economic Transformation, said: “Through our Modern Industrial Strategy, we are going further and faster to give scale-ups the support they need to stay and grow here in the UK and boost the economy.

“This includes working side by side with the private sector to tackle the barriers scaling businesses face and provide them with more financial firepower, including through the British Business Bank.”

ENDS

About VenturePath
VenturePath are operators of the UK’s ScaleUp Investment Platform, preparing and connecting scaling entrepreneurs with their Series A-B investors, and working to help create more UK venture-backed scaleup successes. VenturePath also coordinates The UK ScaleUp Investment Mission; an alliance of 100 organisations, and £13bn of VCs, collaborating to improve the conditions for success for UK scaleups, inviting public sector collaboration.