London's Alternative Investment Market is facing renewed pressure as the number and value of companies listed on the UK's specialist growth market continue to fall.

AIM, operated by the London Stock Exchange, once hosted 1,694 companies with a combined value of £97.5 billion at its 2007 peak. It now has around 605 companies worth approximately £62 billion, according to recent analysis.

The decline has raised concerns about Britain's ability to provide smaller and fast-growing companies with a strong route from private investment to public markets.

Businesses are facing competition from private equity and newer private-company trading platforms, while changes to tax incentives and weaker investor demand have also affected AIM's appeal. The FTSE AIM All-Share index has fallen substantially over the past five years.

The London Stock Exchange has introduced regulatory changes intended to make AIM more attractive, including removing some reporting requirements. However, investors and companies remain divided over whether the reforms will be enough to reverse the market's decline.

The future of AIM matters beyond the stock market because Britain's growth companies need reliable access to capital if they are to expand, hire workers and compete internationally.