The UK’s venture capital (VC) market recorded a year-on-year decline in both deal volume and funding value in January, new figures released by GlobalData have shown.

The data and analytics firm said this reflects a more selective investment environment at the start of the year.

In January, the total number of VC deals announced fell 20.9% from last year, while corresponding aggregate funding value declined 13.2%.

However, analysis of GlobalData’s financial deals database revealed that the UK remained among the top five global markets for VC activity in January 2026. The country accounted for approximately 6.2% of total VC deals announced worldwide, marginally up from 6% a year earlier.

In value terms, the UK’s share declined more noticeably to 1.3%, compared with 4.7% in January 2025, which GlobalData said underscores the relative shift in global capital allocation.

Lead analyst at GlobalData, Aurojyoti Bose, commented: “The relatively moderate fall in terms of deal value compared to deal volume suggests that investors are prioritizing quality over quantity and backing proven scalable models. In fact, the average size of VC deals announced in the UK increased from $14m in January 2025 to $15.4m in January 2026.”

Bose added: “This decline in share is less a reflection of UK-specific weakness and more an outcome of exceptional value expansion in the US, where capital deployment surged dramatically and lifted the global aggregate.

“With average deal sizes rising and investors concentrating capital into scalable, defensible models, GlobalData expects activity to remain disciplined in the near-term. A gradual rebound in volumes is likely as macro visibility improves, and growth-stage confidence strengthens.”

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