Scotland had a record-breaking year for investment value in 2025, outstripping the post-pandemic peak years of 2021 and 2022. A total of £1.15bn was raised compared with £906m in 2024, a 26 per cent increase.
However, a single megadeal of £445m into Edinburgh-based battery energy storage company Fidra Energy accounted for 39 per cent of Scotland’s total investment value.
Scottish Enterprise has published its Risk Capital Market Report, entitled Investing in Ambition. Its 2025 benchmark analysis, based on Beauhurst data, shows while money invested in the UK is up 4 per cent to £24.39bn, the number of deals has dropped 7 per cent to 5,982.
This contrasts with the picture in Scotland with the £1.15bn investment, which involved 359 deals, up 2 per cent. Nearly £200m, at £194m, was invested in Scottish spin-outs, which represents 17 per cent of the total.
We need to ensure early-stage companies are supported and that there is a raft of investors keen to be involved with early-stage, spin-out opportunities
- Derek Shaw
Derek Shaw, the director of entrepreneurship and investment at Scottish Enterprise, the national economic development agency, believes the results are a strong indicator of Scotland’s investment potential.
“The key takeaway from the 2025 report is the not insignificant increase overall in the level of investment at £1.15bn, which is a 26 per cent increase on 2024 figures. This is notwithstanding the fact that one particular deal was a very large deal and contributed £445m. This is very encouraging for Scotland, but we can’t rest on our laurels,” he says.
“We have three inter-linked missions at Scottish Enterprise. We want to accelerate the energy transition creating competitive international companies in Scotland; we want to scale our innovation with high-growth firms of the future; and we are seeking to boast capital investment which will make major improvements in Scotland’s productivity,” continues Shaw.
If Scotland wishes to scale-up more companies, the size of single investment on deals has to increase to over £10m, and increasingly in the plus-£50m to £100m category. While megadeals, of over £100m, are an important feature of global risk capital value in 2025, there has been only one in Scotland.
The Fidra Energy sale is an interesting case because of the company’s creation and evolution. Fidra was established in 2021 by several experience executives who have pulled together their industry experience and coupled this with major international support from capital markets to supercharge their growth.
Shaw sees Scottish Enterprise’s role as helping high growth companies at each stage of the investment cycle.
“If you look at the spread of investment from early stage from £2 to £10m, and then
£10m and above, it is positive. We need to ensure early-stage companies continue to be supported and that there is a raft of investors keen to be involved with early-stage, spin-out opportunities.”
Scotland’s risk capital landscape continues to attract a range of investor types. Venture capital (VC) and private equity (PE) investors remain active in the Scottish market, despite decreases in the value and volume of participations.
Individual business angel syndicates also continue to play an active early-stage role in the Scottish market.
“Then, as Scottish companies grow and scale, that requires access to the later rounds of investment that they need in the £10m and above category, with this a key threshold. We are looking at the overall picture.
“When you look at VC investment, in particular, we had around 80 deals in Scotland. I think that’s positive. We’re seeing more international investment coming through,” says Shaw.
Shaw is also encouraged that Scotland was the top performing nation and region outside the ‘Golden Triangle’, of London and East of England, ranked fourth for deal count, rising from sixth place. Scotland was the only part of the UK to see both investment value and number of deals increase in 2025.
“Companies such as Trogenix, a clinical stage spin-out in biotechnology from Edinburgh University, which is using machine learning, has Series A level funding of £70m. While Chemify, from the University of Glasgow, a spin-out at the intersection of biotech, AI and digital biochemistry, has Series B level of funding, at over £37m.
“That’s fantastic and I think it’s testament to the quality of innovation coming out of Scotland and particularly from our universities.”
Wordsmith is the fastest-ever Scottish start-up to reach a valuation of over $100m, achieving this just 18 months after its launch. The company is dedicated to helping build an AI ecosystem in Scotland for the legal profession.
