The Deal Q3 2026

Equity investment in Q3 2026 stood at £6.59bn across 1,168 deals, slightly ahead of Q3 2025, but down from a Q2 which saw the most capital raised in more than four years. Q1-Q3 2026 was the strongest Q1-Q3 period since 2022.

Investors are concentrating capital in fewer rounds. Deal numbers so far in 2026 are down 13.4% on the same period in 2025, while the average amount raised has climbed 41.9% to £5.42m. This is partly the result of a small number of megadeals: in Q3 2026, the top three rounds by value accounted for £2.56bn, almost 40% of investment raised.

Equity invested in Q1–Q3 2026 sits 4.17% below the same period in 2022. Adjusted for inflation, that shortfall widens to 17.4%, meaning rising prices account for around three-quarters of the real-terms gap to 2022, rather than changes in investment behaviour.

Investment has recovered strongly from the low of £4.13bn in Q3 2024, growing 19.1% in real terms compared with Q1–Q3 2025. This comes as inflation picks up, with CPI rising from 2.6% in June to 3.5% in September 2026, driven largely by fuel prices and global uncertainty, suggesting resilient investor appetite for UK companies. However, with inflation only just starting to rise and uncertainty persisting, Q4 2026 could prove to be a softer investment quarter.

After a period of relative stability since Q3 2025, the median pre-money valuation for AI companies at Seed stage reached £3.28m in Q3 2026, up 35.1% from £2.42m in Q2. By contrast, the median for all Seed-stage companies has held at around £2.00m since Q4 2025. AI Seed valuations have held a premium over the wider Seed market in every quarter since 2021.

Across all stages, the average AI pre-money valuation was £43.9m, more than ten times the median of £4.07m, reflecting a few very highly valued companies. In the wider market, Venture valuations rose 7.00% from Q2 to £5.88m, while Growth valuations fell to £17.0m from £23.8m, in line with the sharp quarter-to-quarter swings seen throughout the period.

A growing share of UK equity deals are going to companies raising for the first time. In 2025, 2,825 companies raised their first equity round, roughly level with the previous peak in 2021, and first-time rounds made up 43.3% of all deals. That share has risen further to 44.1% in Q1–Q3 2026, the highest in the period. Follow-on rounds fell from 5,252 in 2021 to 3,704 in 2025. The steady growth of first-time rounds points to a healthy pipeline of new UK companies, particularly in AI.

Investment in 2026 has become increasingly concentrated in the largest rounds. Rounds of £100m or more accounted for 60.3% of capital raised in Q1–Q3 2026, up from 34.6% in 2025, and the highest share since 2021, despite making up just 0.75% of deals. The trend sharpened in Q3, when 11 megadeals delivered 64.9% of the quarter’s capital, double the 32.3% share in Q3 2025.

AI companies are driving this trend, securing 23 of the 32 megadeals so far this year, while Cloud Computing companies alone raised £6.06bn through nine megadeals. This concentration means headline growth masks a more selective market below £100m, where capital fell 25.5% from the same period in 2025.