UK venture capital market tumbles

For the period April to June 2002, only 44 venture capital deals worth £208m took place compared to 99 deals valued at £306m for the same period last year, according to research by Ernst & Young and VentureOne.

In total the UK market accounted for 30% of all deals across Europe, which saw 259 deals worth £1.87bn, a 5% decline on the first quarter of the year. Only France bucked the trend, registering a 24% increase in investment.

Stuart Watson, head of E&Y's venture capital advisory group told the FT: 'There is a very clear move away from early stage deals towards the more financially robust and more proven businesses in later stage deals. It is this move that is holding up average deal sizes, which are remaining more or less steady.'