The EU introduced its vision for the circular economy in 2014, kick-starting the transition away from traditional linear economies. Eight years on, and the circular economy is no longer simply a concept, but a vital consideration for businesses, no matter the sector. The concept of the circular economy continues to gather momentum as it becomes increasingly acknowledged as an essential part of the solution in tackling the climate crisis.
The opportunities created by transitioning to a circular economy are not just limited to the natural resources; it also creates a unique opportunity for entrepreneurs and investors to collaborate and develop circular business models which combine economic value creation and sustainable future.
The BDO Circular Economy Series looks at how the UK M&A market is driving the circular economy and its transformational use in eliminating waste and pollution, circulating products and materials, and the regeneration of nature.
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In the latest publication in our BDO Circular Economy Series, Investment into the UK circular economy, we consider the changing attitude of private equity, venture capital investors and debt funders towards Circular Economy businesses.
Annual investment in UK Circular Economy businesses has tripled in volume from 42 deals in 2018 to 119 in 2021 with over £1bn of capital deployed in SMEs by private investors. We take a look at:
- Who is investing in the UK Circular Economy?
- What is driving increased investment activity?
- Which sectors are being influenced by circular economy trends?
- What can an investor offer your business in return?
KEY PUBLICATION HIGHLIGHTS
- 296 investments in circular businesses and over £1.5bn capital deployed across both equity and debt.
- Annual deal volumes grew from 42 in 2018 to 119 in 2021 at a CAGR of 41%.
- Venture capital accounted for 50% of 2021 transactions, supported by mid-market private equity (22%) and debt funding (15%).
- Industrials and Manufacturing is the most prominent sector for Circular Economy investment, accounting for 37% of deal volumes in 2021
- 26% of 2021 investments were made into technology-led businesses
Get in touch with our team
BDO Corporate Finance is experienced in the mid-market, advising entrepreneurs, private equity and public companies who are buying or selling a business, seeking investment and raising debt funding.
If you’d like to discuss the publication in more detail or gain more of an understanding as to how BDO can help your business, please get in touch with one of our Circular Economy sector leads Rory McPherson or Todd Mills.
TODD MILLS ►
Coporate Finance - Assistant Director
BDO Glasgow
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