Scotland's startups are hitting a sweet spot, guest blog by James Trotman, Head of Investor Relations at CodeBase

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Let’s be honest, startup ecosystems around the world have been on a rollercoaster for the past few years. A pandemic-fuelled investment boom, followed by a sobering contraction, has left founders and investors alike wondering where the next big opportunity will emerge.

But while much of the UK (and beyond) wrestles with declining deal volumes and shifting investor appetites, Scotland is quietly building momentum. And it’s time we started talking about it.

And the data doesn’t lie: Scotland is bucking the trend. According to Beauhurst’s May 2025 report, Scotland’s early-stage investment market has defied gravity. Strip out the anomaly years of 2021–2022, and Scotland is on a steady upward climb with investment into Scottish companies growing 24% from 2023 to 2024, even as overall deal volume dipped slightly (down 9%).

What does this tell us? Investors are backing Scottish startups with conviction, writing bigger cheques and showing real confidence in the ecosystem. This isn’t a blip. It’s a trend.

The good news doesn’t stop at capital flow. RSM UK’s recent figures show a 15% increase in Scottish tech company formations in Q2 2025, a sharp rebound from a slight dip in Q1.

This is a clear signal that entrepreneurial confidence is returning  and that founders increasingly see Scotland as a viable, even preferable, place to start and scale their companies.

In the last week, YCF released a telling piece titled “New Investors Flock to Scotland”, highlighting a 12% rise in new investors making their first ever investments in Scotland. That’s a major signal, and as domestic markets contract or become saturated, international investors are starting to see Scotland for what it truly is:

  • A tech-savvy, talent-rich ecosystem

  • A country with strong public-sector support and global connections

  • A place where capital can go further, and innovation can move faster

Deals like Wordsmith’s $25M Series A led by Index Ventures, Orbex’s $20M Series C extension backed by Denmark’s Export & Investment Fund, and BLK Global’s £50M round led by Nimbus Capital don’t just show momentum, they prove that international investors are actively betting on Scotland’s breakout potential. According to Scottish Development International (SDI), there’s increasing demand from overseas VC firms wanting to tap into Scotland’s emerging categories including AI, HealthTech, and consumer technologies, not historically seen as Scottish strongholds. That’s changing, fast.

Scotland’s startup ecosystem is hitting a sweet spot. For years, foundational work has been laid, from university spinouts and incubator programmes to angel networks and early government support. Now, we’re seeing the maturation of that ecosystem, with more “investable” companies reaching traction and scale.

Crucially, the market shift toward slightly later-stage early-stage deals, seed and Series A, actually suits where many Scottish startups are in their growth journey. It’s good timing, and Scotland is rising to meet the moment. According to Scottish Enterprise, they are seeing a sophisticated pipeline of companies that are ready for global scale in not-traditional sectors that are attracting the interest of investors from London to San Francisco.

At CodeBase, we’ve always believed in starting where you are with a global first mindset. That’s why Techscaler exists, to support founders with world-class education, expert mentorship, and a community of like-minded innovators, regardless of background or geography. We’re not just helping build startups, we’re helping build a nationwide startup culture that’s open, ambitious, and ready for what’s next.

Scotland isn’t just catching up. It’s setting the pace. With stronger investment activity, rising company formations, and increasing international interest, the ecosystem is showing resilience and ambition, exactly what’s needed in a turbulent global market.

So, yes, we do need to talk about Scotland. Because in 2025, it’s one of the smartest places to launch and back the next generation of world-changing tech companies.