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Briefing: startup deals in May 2017

21 June 2017|by Beauhurst

Each month, Beauhurst issues a briefing on the most interesting UK startup deals from the previous month; in this case, May 2017. It is covered by various news publications and subsequently published here. 

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Overview

Number of deals: 202
Total raised: £941m
Average deal size: £4.95m 
Average pre-money valuation: £8.25m

Commentary

May saw an unusually high amount invested (up £351m from April's £590m) in high-growth companies. This was due almost exclusively to Improbable's huge raise – the largest amount raised by a UK company since Beauhurst's records began, seven years ago.
 
Deal numbers, however, continued their steep decline from April, plummeting to 202 from 379 in April and 470 in March. Slightly lower numbers than the previous month are always to be expected, given that companies which closed rounds at the end of May still have a week in which to file the deal, but the scale of this drop and its continuation from April suggests other factors at issue; uncertainty surrounding the General Election might play a role.
 
There were 322 deals this time last year, and it is unlikely that we will see the shortfall made up in the coming two weeks. That said, every May since 2010 has seen a deal dropoff (frequently large) from the preceding April – possibly related to the financial year's end.
 
Crowdcube participated in the most fundraisings (4) this May of any funder, followed jointly by Accelerated Digital Ventures, Mercia Fund Management, Seedrs, and Woodford Investment Management.
 

Biggest deals

1. Improbable
Improbable is developing technology that facilitates the creation of simulated worlds – software that simulates the behaviours of a large number of entities within a given environment. This has applications for gaming, defence, energy, transportation, health and finance.

improbablesign_me copy.png
Deal date: 11th May 2017
Deal amount: $502 (£389)
Investors: SoftBank Capital

The deal takes Improbable's total amount raised through equity to £421m. It has also been widely reported as catapulting Improbable to unicorn status. Check out our blog on the deal.
 
 
2. Gigaclear
Gigaclear provides ultrafast broadband internet access using fibre-optic service to homes and businesses in rural communities.gigaclear-logo copy-1.png
 
Deal date: 5th May 2017
Deal amount: £111m
Investors: Infracapital, Railpen, Woodford Investment Management
 
This was follow-on capital from Infracapital and Woodford. Gigaclear's pre-money valuation was £136m. 

3. Claranet 
Claranet provides managed IT services, including hosting, networks and communications support.claranet.png
 
Deal date: 11th May 2017
Deal amount:£80m
Investors: Tikehau Capital
 
Two weeks after this deal (Claranet's first), the company made three acquisitions: Sec-1, ITEN Solutions, and Oxalide.
 

4. MiNA Therapeutics
MiNA Therapeutics develops medical treatments by returning normal function to patients' cells using small activating RNA to target and activate genes. The company focuses on liver diseases.mina therapeutics.png
 
Deal date: 3rd May 2017
Deal amount: £35m
Investors: Sosei
 
Advised by Ferghana Partners, Clifford Chance, & Taylor Wessing; this deal valued the company at £100m pre-money.
 
 
5. StarLeaf
StarLeaf operates a global video communications network and develops video conference calling technology.cropped-Starleaf_NO-TAG copy.png
 
Deal date: 9th May 2017
Deal amount: £31m 
Investors: Grafton Capital, Highland Capital Partners Europe
 
This was StarLeaf's seventh equity raise and by far its largest. At its previous raise, in November 2014, the company was worth £26.1m pre-money. 
 
 
May startup fundraisings.pngEquity investment in high-growth UK companies over the last six months
 
 
 

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