The Investment Gap: Which Regions Are Being Left Behind?

The State of Investment Q3 2025, our upcoming report on equity investment into UK businesses, launches next week. Ahead of publication, we’re exploring what the key insights say about regional growth in the most recent quarter.

Historically, and from what we’ve seen so far in this year’s data, London commands the lion’s share of investment, both in number and value of deals. Other regions, such as the North East, East Midlands, and Northern Ireland all receive proportionately lower levels of investment by comparison.

And whilst trends in the flow of equity investment is not necessarily a 1:1 representation of regional wealth, investment can (and does) have a material impact on employment and growth in a region.

Regional investment in Q3 2025

At first glance, Q3 2025 appears to show investment spread more evenly across the UK.

The North West has seen a 110% increase in the amount raised compared to the previous quarter, whilst the West Midland’s increase of 152% and Scotland’s 379% uptick in the value of deals sit in contrast to a 28% reduction in the total value of equity invested into London’s companies.

Our analysis reveals that London took 54% of the UK’s total value of investment raised in Q3 2025, down from 67% of the nation’s total in the Q2. This appears, at least initially, to show a more equitable trend in the flow of investment.

However, this belies two crucial distinctions — firstly that UK investment is down by more than a third (35%) between Q2 and Q3 2025, dropping from £6.84b to £4.45b. Secondly, an increase in the total amount raised, without a substantial increase in the number of rounds too, indicates a skewing of the figures by larger rounds, including megadeals (£50m+) and gigadeals (£100m+).

In other words, just because companies in the region raise more equity, it doesn’t mean they’re more popular places to invest.

Scotland is an example of this, with Edinburgh-based Fidra Energy’s raise of £445m in Q3 2025 a huge outlier. The number of deals actually dropped by 13%, with that single deal comprising almost 80% of the total investment value in Scotland.

Companies based in Wales exhibit the opposite trend, with deal numbers increasing by 39%, whilst the total value of deals collapsed from £117m in Q2 to just £6.77m in Q3 2025.

The North West was the only region in Q3 2025 to have an increase in both the number and value of deals, with 78 rounds completed worth a total of £166m. Meanwhile, the North East fared less well, with just two more rounds completed and a 61% drop in investment value.

Regional investment trends (2021-2024)

In order to properly gauge investment trends, it’s worth looking back over annual figures.

As we have outlined in The Deal, our annual equity investment report, the value of investment has been almost universally down year-on-year for some time now, since the investment peak of 2021.

And this is broadly true when examining the annual number of rounds too, with a couple of exceptions. In 2024, Scotland, the East Midlands, and Wales were all up on 2021’s deal figures — suggesting that whilst value fluctuates from quarter to quarter, these regions are seeing a longer-term uptick in investment activity.

Get the full picture of regional investment

Next week, we’re publishing our complete report on the State of Investment Q3 2025.

While this article gives a snapshot of regional investment, our full State of Investment Q3 2025 report goes much deeper — tracking shifts in deal volumes, investor behaviour, and performance across industries.

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