Startups love the UK. Its IPO market? Not so much

U.K. superior markets are astatine a crossroads. The country's startups raised $8 cardinal successful the archetypal six months of the year, according to a study from Dealroom and HSBC Innovation Banking — much than France and Germany combined.

It besides recovered that the U.K. was Europe's apical destination for task superior for the 30th consecutive quarter, claiming 30% of each superior raised crossed the continent truthful acold this year.

But there's a flip side.

Dealogic information shows fundraising from London IPOs successful the archetypal fractional of 2025 fell to its lowest level since data was archetypal collected successful 1995. Just 5 companies made their debut connected the London marketplace successful the archetypal six months of the year, raising £160 million.

The dismal figures travel a fig of high-profile blows for the London Stock Exchange. These see wealth transportation firm Wise's decision past period to determination its superior listing determination to the U.S., and reports that British pharma giant AstraZeneca could travel suit.

Peter Specht, wide spouse astatine Creandum, 1 of Europe's astir palmy early-stage VCs, said helium sees immoderate momentum successful the IPO market, but called for overmuch greater collaboration betwixt the antithetic stakeholders.

"I deliberation what's astir important is the dialog betwixt the tech leaders that are soon going to IPO and the adjacent procreation that volition bash truthful successful a fewer years, and the regulator," helium told CNBC's "Squawk Box Europe" Thursday.

"I deliberation we request to foster that treatment adjacent much and enactment connected it, due to the fact that what we request successful the U.K. and Europe is marque it arsenic charismatic arsenic imaginable for companies to IPO here."

The Confederation of British Industry has called for a caller communicative astir the LSE and publically listed companies, saying that "bold action" is required to revitalize U.K. nationalist equity markets.

London Stock Exchange CEO Julia Hoggett told CNBC that "a connection of risk" has been created successful the U.K. implicit the past 30 years, "rather than the connection of the accidental that comes from investing." 

She called connected the authorities to deliberation with an concern mindset, saying "we've truthful protected radical from the downside, we haven't exposed them to the upside, and arsenic a nation, we haven't had a speech astir the accidental outgo of that." 

This risk-averse attack is thing Edward Knight, president astatine VC steadfast Antler, has witnessed, telling CNBC that the appetite for hazard that exists successful immoderate corners of the satellite "certainly doesn't exist" successful the UK.

He urged the state to larn from the past, saying: "We had the accidental to invited crypto into our arms erstwhile the SEC nether Gary Gensler was rejecting it, but we passed up that opportunity. We fto it spell … Let's not bash the aforesaid happening again connected AI."

In its report, the CBI called for policies that would amended liquidity and competitiveness, portion strengthening the IPO pipeline. The London Stock Exchange's Julia Hoggett has hailed its betterment docket successful caller years, telling CNBC, "we person truly made our markets lucifer fit."

Meanwhile, Nigel Morris, managing spouse astatine fintech VC level QED Investors, told CNBC via email that the U.K. authorities is moving to code concerns from U.K. concern leaders. These see "the existent taxation scheme, which immoderate accidental punishes employees of maturation signifier companies, oregon the constricted quality to entree superior for scaling fintechs."

So wherever does each of this permission the outlook for London IPOs?

Hoggett says the pipeline for listings is growing. "It's a spot similar an iceberg beneath the aboveground … but that pipeline is gathering precise rapidly, and from astir the world, due to the fact that I deliberation the reforms that we've seen successful the U.K. person really enabled the U.K. to beryllium a truly compelling proposition."

Norwegian bundle elephantine Visma has chosen London for its IPO adjacent year, according to quality archetypal reported successful the Financial Times, but the pipeline beyond that appears to beryllium quiet.

"I deliberation the founders of these businesses person to person a long, hard deliberation astir wherever they deliberation their interests are champion going to beryllium served by going public," said Antler's Knight.

"And there's a batch of complications and dynamics to being a nationalist company, and truthful they request to sermon these with their boards, spell done this with their investments, find retired wherever those interests are champion served."