UK Venture Capital Financial Returns 2025

The UK Venture Capital (VC) Financial Returns 2025 report provides a comprehensive assessment of the performance of UK VC funds since 2002. The report draws together data directly sourced from fund managers, the Bank’s equity programmes, as well as from commercial data providers Pitchbook and Preqin. 

The report contains the following chapters:

• Chapter 1 provides an overview of UK VC market performance in comparison to the US and the rest of Europe (ROE), breaking down returns into different vintage year cohorts.
• Chapter 2 examines the returns of key alternative asset classes such as private equity, private debt and real estate, and compares them to the performance of VC.
• Chapter 3 assesses the performance of VC funds the Bank has invested in through its Enterprise Capital Funds (ECF) programme and its venture and growth portfolio.
• Chapter 4 looks at fund managers’ perspectives on fundraising conditions, exit opportunities and dealflow, as well as investment opportunities across the UK’s modern Industrial Strategy sectors.

Key Findings

The overall performance of the UK VC market continues to be in line with the rest of Europe and below the US

UK VC funds with 2002-2020 vintages generated a pooled total value to paid-in capital (TVPI) multiple of 1.84, compared to 1.85 for funds across the rest of Europe and 1.95 for US funds. When focusing on realised returns, the UK’s pooled distributions to paid-in capital (DPI) of 0.69 is also in line with the rest of Europe (0.70) and lower than the US (0.99).

Returns of UK funds stabilised over the past year, representing an improvement on the 2024 report

Looking at funds that reported performance data in both 2024 and 2025, the UK’s pooled TVPI value remained stable at 1.51 (versus 1.52 in 2024). After a decline in the pooled TVPI of 7% in last year’s report and 9% in 2023, this indicates that UK fund managers are no longer writing down portfolio valuations to the same extent. At the company level median valuations increased by 5% in the year to 2025 Q1, indicating a recovery in the level of competition in the market.

The UK has a similar proportion of funds as the US reporting positive returns, but a lower share of top performers

Looking at the distribution of returns, 52% of UK funds have a TVPI of between one and two, compared with 48% of US funds and 51% of funds in the rest of Europe. However, when looking at the highest performing funds, 8% of UK funds reported a TVPI of three or more, compared with 13% for the US and 14% for the rest of Europe.

VC and private equity have produced stronger returns than other asset classes, while top venture funds can generate the highest gains

UK private equity and VC funds demonstrated the strongest performance across 2002-2020 vintage years, with median TVPIs of 1.74 and 1.48 respectively. Infrastructure has been the third best performer with a median TVPI of 1.30, followed by private debt (1.24) and real estate (1.21). VC’s upper quartile TVPI multiple of 2.15 was higher than any other asset class.

The ECF programme continues to perform well against the wider UK market, while there is a more nuanced picture for the Bank’s venture and growth fund returns

VC funds supported by the Enterprise Capital Funds (ECF) programme with a 2006-2023 vintage reported a pooled DPI multiple of 0.62, compared to 0.48 for wider market funds. Funds in the Bank’s venture and growth portfolio with 2018-2023 vintages have generated a pooled DPI multiple of 0.09, which is in line with the pooled return generated by funds in the wider UK VC market (0.08).

Survey evidence suggests a more positive outlook for the UK market, with fund managers seeing opportunities across the eight Industrial Strategy sectors 

This year’s survey of 50 UK fund managers found that while half (54%) of respondents viewed the state of the market for providing exit opportunities as poor or very poor, over two thirds (68%) expect exit conditions to improve over the next year. 

Over three quarters of respondents (79%) also viewed the quality of investment opportunities in the market as very good or good, with 85% of General Partners (GPs) considering investing in the digital and technologies sector, followed by financial services (64%) and life sciences (47%).