More than nine in 10 (97%) private business owners in London are confident of delivering growth in 2025, according to KPMG’s mid-year Private Enterprise Barometer check-in.
Earlier this year, KPMG unveiled its first-ever Private Enterprise Barometer, an annual survey capturing the perspectives of 1,500 privately owned businesses, including 172 in London, from across various industries.
Following a challenging six months of economic headwinds, KPMG has revisited businesses to understand how developments in the first half of 2025 may have influenced their outlook. Earlier this year, 88% of private businesses in London expressed confidence in their growth prospects for the next 12 months. By the mid-year mark, this sentiment has grown, with confidence levels rising to 97%, reflecting a change in outlook regarding their growth ambitions.
Technology continued to dominate as a leading investment priority for London-based businesses, with 74% identifying areas such as artificial intelligence (AI), cyber security and broader digital transformation as key focuses.
Diversification is also high on the agenda for private businesses across London. A growing number of firms (77%) are looking to introduce new service lines and expand their client offering, meanwhile, three quarters (75%) are targeting entry into new markets. Both figures show a notable increase (from 68% and 58%, respectively) at the start of 2025.
When it comes to external challenges, inflation remains the most pressing concern, cited by almost half (48%) of respondents. Interest rates and rising employment costs are the next biggest concerns, each identified by 31% of business leaders as key risks.
The appetite for alternative funding options is also gaining momentum, with three fifths (63%) of the capital’s businesses now open to private equity investment. This growing interest reflects a broader willingness among firms to explore new sources of capital in support of innovation, growth and long-term resilience.
Anna Purchas, London Office Senior Partner at KPMG UK, said: “Leaders in London are entering the business end of 2025 with the highest level of growth confidence we’ve seen across the UK this year.
“It’s clear that technology remains a top priority, from AI to cyber security, as firms look to future-proof their operations and stay competitive. On the ground, we’re also seeing confidence beginning to be buoyed up with the Mayor’s London Growth Plan and the Government’s Industrial Strategy signalling that the cohesion and support needed to scale will be there. Coupled with strong ambitions to diversify and a growing interest in new sources of finance, this suggests that London’s business community is focused on long-term growth and ready to take bold steps to achieve it.”
