The British Business Bank’s annual Small Business Equity Tracker reveals that London attracted the highest level of equity investment in the UK during 2025, with announced deals totalling £6,982m. The North West (£1,230m) and East of England (£1,022) ranked second and third, respectively.
Although the number of announced deals fell by 18% to 957, London remains the largest equity investment hub in the UK. Investment value also dipped slightly from the previous year, falling by 9%. In 2025 London made up nearly half of UK equity deals.
London’s more resilient investment value is indicative of investors concentrating capital into fewer, larger transactions, also a broader trend across the UK. The top 10 UK fundraisings accounted for nearly a quarter (23%) of all investment, the highest level since 2020. For example, in the North West and South West deal numbers decreased while investment value increased significantly owing to significant single deals in the regions.
The concentration of investment into a smaller number of high value deals is driven by an increase in AI investment. AI companies accounted for 44% of total equity investment into UK smaller businesses in 2025, the highest share on record. AI also represented more than a quarter (26%) of all deals, nearly doubling its share since 2022.
Equity investment into London continues to be boosted by its university spinouts. London was home to 21% of all UK university spinouts incorporated between 2013-2022 that raised equity. Furthermore, 19% of all university spinouts nationally were founded in the Fity, with London boasting the highest share of university spinouts overall.
Mark Sterritt, Managing Director, British Business Bank Local Growth Team said: “London continues to play a central role in the UK’s equity finance market, attracting almost £7 billion of investment in 2025. Despite a decline in deal activity, the capital remained the UK’s leading destination for equity investment, reflecting the strength and diversity of its business ecosystem.
“Access to growth capital remains essential for innovative businesses looking to scale, create jobs and drive economic growth. These findings underline London’s importance as a hub for entrepreneurship while highlighting the need to ensure promising businesses can continue to secure the finance they need to grow.”
The British Business Bank has accelerated its pace of investment following the publication of its Five-Year Strategic Plan in November 2025. By increasing our annual deployment by two-thirds, we are unlocking around £26bn of private capital alongside £13bn of our funding over the next five years. The Bank is also deploying £4bn to boost the most promising businesses in the government’s eight Industrial Strategy sectors.
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