Scotland’s equity investment landscape has remained buoyant during the first half of 2025, with university spinout activity leading the way, according to new research.

The British Business Bank’s annual Nations and Regions Tracker revealed that in the first six months of 2025, Scotland recorded 87 equity deals with a combined investment of £226 million. Among this, 16 equity deals involved university spinouts, representing 18% of all UK spinout activity.

Despite a fall in the total deal volume and investment value compared to the same period in 2024 (-19 per cent and -23 per cent, respectively), Scotland continued to punch above its weight in terms of the share of investment that smaller businesses secured. Deals in Scotland accounted for 11% of total UK equity investment in small businesses – almost double the proportion of the UK’s small business population based in Scotland, which stands at 6%.

Susan Nightingale, Director, UK Network, Devolved Nations at the British Business Bank, said: “It’s promising to see Scotland leading the UK in equity deal volume growth, demonstrating resilience in a challenging market. The ambition and drive of Scotland’s high-growth businesses are unmistakable, and our Investment Fund for Scotland is already unlocking exciting new opportunities for companies across the country with over £26m of funding agreed so far.”

Meantime, one in ten adults are now starting or running a young company in Scotland, according to a business activity survey.

The Global Entrepreneurship Monitor (GEM) Scotland 2024-25 found that 10.4 per cent of working-age adults in Scotland were engaged in early-stage entrepreneurial activity in 2024 – the highest figure since the survey began in 2002. With an additional 8 per cent of adults reporting as established business owners, it means nearly one in five Scots are now classed as entrepreneurs.

Dr Samuel Mwaura, Lecturer in Entrepreneurship & Innovation at the University of Edinburgh Business School, who is among the co-authors of the GEM Scotland 2024-25 report, said: “The study reveals a record level of participation in early-stage start-ups, while also highlighting persistent gender and regional disparities that necessitate targeted policy responses.

“However, the gender gap has widened, with male participation rising to 12.7 per cent while female participation remained static at 8.1 per cent.

“A female-to-male total early-stage entrepreneurial activity (TEA) ratio of 64 per cent in 2024 represents the widest gender gap among the Home Nations. This follows near-parity in 2023, when women were starting and running new businesses at almost the same rate as men for the first time,” he said,

Regionally, activity remained robust in the Highlands and Eastern Scotland but declined sharply in the North East, where early-stage entrepreneurship halved in the past year, although small sample sizes increase the margin of error in the estimates.

Entrepreneurial activity among non-White Scots continues to outpace that of White Scots, at 22.7 per cent compared with 10.4 per cent.

The findings also point to key policy considerations. Women are significantly less likely than men to feel they have adequate access to business support, and regional fluctuations suggest the need for locally tailored approaches.

The report also says support for younger entrepreneurs is essential, given the strong youth engagement but limited resources available to early-stage founders.

Entrepreneurship is very positively regarded in society, with over 70 per cent of the adult non-entrepreneurial population surveyed indicating that startup activity receives regular coverage in the media and successful entrepreneurship is well respected in society.

Professor Sreevas Sahasranamam, of the Adam Smith Business School at the University of Glasgow, said: “Scotland’s record-breaking entrepreneurial activity is an encouraging sign of the country’s economic dynamism. However, the reopening of the gender gap and persistent regional disparities remind us that inclusive and tailored support is essential.”

Dr Efstathios Tapinos, of the Hunter Centre for Entrepreneurship, Strategy and Innovation at the University of Strathclyde, said: “The volatility of entrepreneurship in the North East Scotland requires focussed attention to identify its root causes and provide structured support.”

Darren Pirie, Head of NatWest Accelerator, said: “This report does more than illuminate the big trends shaping UK entrepreneurship: it’s a much-needed call to action to build an environment where every entrepreneur and growing business has the tools, confidence and support to succeed.”

In 2024, Scotland was ranked the highest of the UK’s regions and devolved nations in terms of equity deal volume growth, up 13.6 per cent from 2023. The report also shows that Scotland recorded double the number of equity deals per 100 high-growth enterprises (28) compared to the UK average outside of London (14) between 2022 and 2024, ranking second only to the capital on this measure. Scotland also ranked third (after London and the East of England) based on equity investment value per 100 high-growth enterprises (£81m).

The Global Entrepreneurship Monitor (GEM) is the world’s most comprehensive study of entrepreneurship, having surveyed more than four million individuals across over 100 countries since 1999. In the UK, over 372,000 adults have been interviewed since 2002, including more than 46,000 in Scotland with the generous funding support from the Hunter Centre for Entrepreneurship, Strategy and Innovation at the University of Strathclyde.