Will Simpson

RSM’s analysis found a total of 507 new tech companies were incorporated in Scotland in Q2 2025, jumping 15% from 442 in the same period last year. The number of tech incorporations also rose by 25% quarter-on-quarter from 405 in Q1 2025.

All UK regions were up on last year, with nine out of the 12 regions recording the highest number of new tech incorporations since 2019.

Head of technology for RSM in Scotland, Will Simpson, said: “This surprising jump in new tech incorporations to a record high suggests that, despite numerous headwinds, tech entrepreneurs and business leaders in Scotland have realised uncertainty may be the new norm, therefore they need to invest and innovate through the headwinds.

“Scotland is emerging as a potential leader in data science and AI, with our world class universities creating innovators in computing and data science, engineering, cyber and AI.

“Long standing challenges remain however, with many early-stage promising businesses struggling to scale domestically and globally, largely due to the lack of funding fire power needed to onboard a team with the capability to drive commercial scale.

“The innovation and potential coming from Scotland’s startups is incredible, and the tech sector in the country could be a significant driver of growth, if the ecosystem can crack the long-standing scaling conundrum.”

Ben Bilsland, partner and head of technology industry at RSM UK, said: “Following very little for UK tech in the Autumn Budget, the government provided more detail on its Industrial Strategy and Digital and Technologies Sector Plan for tech in 2025.

“This added clarity will have been a boost to the sector, but significant investment is needed, and if economic uncertainty escalates, this will act as a roadblock to future tech growth.

Mr Bilsland continued: “Increasing pressure on the UK government to address gaps in the budget will leave the tech industry feeling nervous about what tax measures might be introduced.

“Changes to capital gains tax will make business founders and investors cautious, with a direct impact on investment and exit decisions. Any changes around the research and development scheme would likely send shockwaves through the tech industry, stifling innovation and growth.

“If income tax is raised, a greater tax burden on higher earners could also exacerbate workforce issues in the tech industry. Skilled workers are in high demand, and increased taxes in the UK might make the extremely competitive salaries available overseas even more appealing.”

He concluded: “UK tech faces fierce competition on all fronts from other countries. The government will need to tread carefully to ensure the UK remains one of the best places in the world to start and grow a tech company, as the exit of our brightest businesses and talent overseas could cause long-lasting harm to the economy.”