Start Ups seek investment from outside Scotland

EIE22 brings investors and startups together in October (pic: Terry Murden)

Scotland remains a “good place” to launch a start up but most rely on raising funds from elsewhere, according to new research.

Almost all respondents (93%) to the 6th annual Scottish Startup Survey said Scotland is a good place to launch a startup, but 88% are targeting investors outside Scotland.  

London and rest of the UK (46%), followed by North America (30%), and Europe (21%) are the most targeted investor regions. 

The figures will raise questions about the level of support offered to the startup community within Scotland.

The survey coincides with publication of the Global Entrepreneurship Monitor (GEM) Scotland report 2021/22, which captures rates of entrepreneurship in the general adult population and reveals there are significant gaps in the confidence Scots have in their entrepreneurial abilities.

The latest Startup survey run by the EIE Investor Readiness Programme at the University of Edinburgh’s Bayes Centre in association with the Freer Consultancy, included responses from the current EIE22 cohort, EIE alumni companies, and a number of other early to later stage startups from across Scotland.

Nick Freer, founding director, Freer Consultancy, said: “One of this year’s more revealing findings is that, alongside targeting homegrown investors, so many of our startups are looking for investment outside Scotland.  

“And, that matches what we’ve seen in recent times, in terms of an increasing number of rest of the UK and international investors backing startups based here.” 

Other findings include: 

  • Scottish tech founders are targeting venture capital and angel firms in near equal measure
  • 71% of startups say they have come out of the pandemic in a stronger position to achieve growth. 
  • Almost half of startups, 48%, are back in the office while retaining hybrid or remote working, with only 19% fully back in the office. 
  • 69% of startups have found it difficult to hire talent over the last 12 months.
  • 76% of respondents said engineers and developers were the hardest roles to fill
  • 67% of startups are targeting talent pools outside Scotland.
  • 81% of respondents said the Scottish Government-commissioned Logan and Stewart reports are positives for the evolution of Scotland’s technology ecosystem. 
  • 55% of startup leaders think that Scotland’s tech ecosystem is in a stronger position compared to a year ago.
  • Nine in ten of early stage companies had grown this year, but are concerned by the global economic outlook. Nearly seven in ten (68%) said Brexit had slowed growth. 

Keynote speakers at this year’s annual tech investor conference EIE22 on 6 October include Scotland’s chief entrepreneur Mark Logan, Women in Enterprise Review chair Ana Stewart, and newly appointed techUK president Sheila Flavell.

The EIE Investor Readiness Programme delivered by the University of Edinburgh’s Bayes Centre has helped over 540 companies raise more than £1.1 billion since 2008.

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