Addressing the “risk off” investment challenge

A challenging environment for UK companies

As we approach mid-2025, life remains challenging for many UK companies and their shareholders, and ‒ as a broad generalisation – consensus suggests little will change in the foreseeable future.

So, are we now facing a real risk of the UK economy stagnating due to lack of funding? If that is the case, who is going to take the initiative and avert such a crisis?

Business life must continue, despite the macro environment providing limited visibility and the distractions of political tensions taking centre stage on a regular basis. This is hardly a background for inspiring confidence. Those of a more optimistic persuasion may point out that the UK stock market indices show signs of stability and the US indices have almost recovered their initial 2025 losses. However, feedback from the UK private company sector raises broader concerns, and this will be the focus of the rest of this article.

Paucity of funding needs to be approached effectively

Despite the ambitious determination of the UK’s entrepreneurial talent, most emerging companies are reliant on external funding – at least until they reach a point of having better control of their destiny. The UK, rightly, has gained a reputation for its depth of such talent and initiative; it remains critical to our future that we encourage these businesses to pursue their ambitions. Sometimes, however, the timing is challenging. Running a business can feel like the world is against you – which is how the management of many private companies feel right now. It may also not be surprising that many owners of established private businesses are asking “what is the point of carrying on for the next five years?” If we are in danger of losing economic momentum, this issue needs to be recognised and addressed. Importantly, are companies addressing these funding challenges in the most effective manner?

Full report here