Mark Sterritt

Published today, the Bank’s annual Small Business Equity Tracker shows that Scotland attracted significantly higher levels of investment despite a decline in overall deal numbers, as a smaller number of larger transactions drove growth.

London’s traditional dominance declined again in 2025, with its share of equity investment falling from 60% to 57%. Against this backdrop, Scotland was among the strongest-performing nations and regions of the UK, alongside the South West and North West of England.

Overall, the number of equity deals in Scotland fell in 2025, reflecting tighter funding conditions seen across the wider UK market. However, the increase in investment value highlights continued investor confidence in Scotland’s strongest sectors and innovation clusters.

University spinouts also proved more resilient within Scotland’s wider equity ecosystem than in the UK-wide picture. Scotland surpassed London in the number of spinout deals completed (45 versus 28), with the University of Edinburgh emerging as Scotland’s most active spinout institution. It completed 16 deals in 2025 and ranked among the top three universities in the UK by spinout deal volume.

The British Business Bank’s activity in Scotland and other devolved nations reflects a continued commitment to addressing regional finance gaps. Across the UK, 84% of the Bank’s newly supported businesses in 2024/25 were located outside the capital.

Scotland benefits from the British Business Bank’s dedicated £150 million Investment Fund for Scotland, which offers a range of commercial finance options, including small loans from £25,000 and equity investment of up to £5m.

Mark Sterritt, managing director, British Business Bank Local Growth Team, said: “Scotland’s performance in 2025 is a real positive in what has been a challenging year for the UK equity market. The increase in investment value reflects the strength of Scotland’s businesses and its innovation base, particularly in sectors such as energy, where the country has clear competitive advantages.

“The continued resilience of Scotland’s spinout ecosystem is especially encouraging, highlighting the strength of its universities and their ability to translate cutting-edge research into high-growth companies. We know that access to finance remains critical, particularly for early-stage businesses navigating tougher market conditions, which is why the Investment Fund for Scotland plays such an important role in helping ambitious ventures across the country access the finance they need to start and scale. We remain committed to supporting entrepreneurs in all parts of Scotland to realise their full potential.”