THE South East equity finance markets have grown in investment value by 59% over the past financial year, with £679m in the first half of this year.
However, early data from 2022 suggests the use of external finance is marginally slowing in the South East as businesses face turbulent market conditions.
The data has been compiled for the Government-run British Business Bank’s second annual Nations and Regions Tracker, which is published today,
They say it also finds promising signs for net zero sector investment in the region with a number of future clusters identified, with neighbouring Oxfordshire identified as future net zero cluster.
Since 2011, £6.9bn of equity investment has gone into net zero-aligned UK smaller businesses across 1,307 deals. The share of deals which are in net zero sectors has grown every year since 2018 rising from 5% in 2018 to 12% in first half of 2022.
Net zero sectors are those that are likely to see growth related to the net zero transition and include: clean technology, hybrid and electric vehicles, biomass and biofuels, artificial meat and meat substitutes, and smart energy
Every English nation and regions apart from the West Midlands saw an increase in equity investment in 2021, with the South East sharing this growth trend.
During the period, investment value in the region was up 59% to £1.6bn over 268 deals. In the first half of this year, just over £679m over 115 identified deals, however current economic conditions are likely to see equity markets slowing over the remainder of the year.
Four in 10 businesses (39%) were using external finance in the South East in the second quarter of 2022, broadly in line with the same period at 40% a year earlier.
Core debt products remain the most used and widely available across UK nations and regions.
Steve Conibear, UK Network Director, South and East of England at the British Business: “It is encouraging to see evidence of a number of future net zero clusters emerging in the region, which is already known as a hotbed of innovation and technology.
“Smaller businesses in the South East continue to show a positive appetite for external finance, be that through equity or wider forms of finance.
“We will continue support these businesses across the South East to access the finance they need and to help enable the transition to a net zero economy.”
