Scottish companies raise $80m in final quarter of 2017

Scottish companies raised $80 million (£57.6m) in the final quarter of 2017, as venture capital (VC) investment reached a UK-wide record of $2.5 billion (£1.8b).

KPMG’s latest Venture Pulse survey reveals that a flurry of $100 million plus (£72m) mega-financings saw the UK overtake previous investment records, raising the lion’s share of investment across Europe.

In Scotland, standout deals in the final quarter included BrewDog, whose ongoing crowd funding round has now reached more than £13.4m.

Commenting on the findings, James Kergon, head of deal advisory for KPMG in Scotland, said: “The strength of the investment market in Scotland is significant, particularly when you take into account ongoing economic uncertainty across the UK. Some investors may have capitalised on the drop in value of sterling, yet the number of later-stage deals reflects the commitment of investors when it comes to established companies.

“Pharma and biotech attracted a significant amount of attention in Scotland throughout the year, reflecting the UK-wide trend of biotech hubs forming outside of London. Indeed, the start-up sector in Scotland is well established, and is an attractive prospect for investors. Financing enables companies to remain competitive, as well as private, for longer.

“Going forward, government initiatives to nurture Scotland’s start-ups will be key to maintaining the country’s attractiveness to investors.

“In the coming months, we expect to see investment in fintech and cross-industry applicable technologies like artificial intelligence, customer relationship management, and data analytics, which use technology to increase the effectiveness and efficiency of less technological mature industries.”

New investment figures published in KPMG’s latest global Fintech Pulse report, which looks at the trends and issues affecting the fintech market globally, further revealed investment into the sector in the UK reached a two year high ($1.6 billion) in the final quarter of 2017.

Sam Subesinghe, head of management consulting for Scotland, said: “The UK remained the standout fintech hub during the final quarter of 2017, as reflected in our Fintech Pulse report.

“The recent implementation of PSD2 (Second Payment Services Directive) remains high on the agenda, as banks and fintech companies across Europe explore opportunities to drive innovation and enhance the customer experience presented by the regulation.”