New data shows nearly £200bn contribution to UK economy as investment shifts beyond London
New research from EY and the BVCA underlines the powerful and growing contribution of private equity and venture capital to the UK economy – something we at Connection Capital see every day through the businesses we back.
The Economic Contribution of UK Private Equity and Venture Capital in 2025 report finds that private capital-backed companies now generate £199bn annually in GDP and support 2.5m jobs – up from 2.2m in 2023. Significantly, 69% of those jobs are located outside London, highlighting how investment is spreading economic benefit across the country.
Meanwhile, the BVCA’s companion Report on Investment Activity shows private capital investment rose 44% in 2024 to £29.4bn, with 58% of nearly 1,600 businesses backed located outside London.
This chimes with our own experience. Since inception, Connection Capital clients have invested over £550m, with more than £233m invested in UK companies overseen by our private equity team. More than half of those are outside London and the south-east.
The impact of private capital on job creation in the UK is found throughout our portfolio with the average number of employees increasing 50% during the tenure of our investment and sometimes much higher. For example, our recent exit from Starbucks franchisee 23.5 Degrees, which grew from 11 to 87 Starbucks stores across the UK, increased employee numbers from 200 to over 1,500 by the time we exited.
Other regional champions have included Winder Power, a Leeds-based manufacturer of electricity distribution transformers; Tempcover (insurance services, Hampshire), Hood Group (insurance services, Essex), and The Light, which operates leisure sites across the UK. These businesses reflect the depth of talent and opportunity beyond the capital.
Private equity is more than a financial instrument – it’s a powerful tool for nationwide economic development. It’s also about people – SMEs are the lifeblood of our economy, and almost nine in ten companies receiving private equity backing are SMEs that would struggle to raise growth capital from other sources. These businesses are not just commercially attractive; they are central to local employment, skills and innovation. At Connection Capital, we are committed to continuing our support for ambitious UK businesses, helping them unlock growth, create jobs, and deliver long-term value for their communities – and our investors.