Will Davis, 31 August 2022
Scotland is home to some of the most innovative tech startups and scaleups in the UK. Indeed, over a quarter (28%) of Scotland’s high-growth businesses are technology companies.
The Scottish high-growth ecosystem has seen numerous startup success stories already, although Aberdeen-based BrewDog is perhaps its most famous. Having reached a billion-dollar valuation back in 2017, BrewDog is also the region’s only active unicorn company (after Edinburgh-based Skyscanner’s £1.4b exit in 2016).
Following the dual challenges of Brexit and the COVID-19 pandemic, the UK tech sector has emerged stronger than ever, with some exciting developments for entrepreneurs looking to build a business in Scotland. Just last month, the Scottish Government approved funding for seven new tech hubs across the region. Meanwhile, Edinburgh is tipped to be the next Silicon Valley, as the ideal place for tech companies to set up shop.
Here, we explore the stats on Scotland’s high-growth tech sector, and take a look at some of the top startups it has to offer.
Whilst there are clusters of ambitious tech companies across Scotland, the majority can be found in the nation’s three biggest cities and economic hubs. Of the 858 high-growth tech businesses currently active in Scotland, 38% are headquartered in Edinburgh, 19% in Glasgow, and 7% in Aberdeen.
Scottish technology companies span a wide range of tech sectors, including cyber security, edtech and blockchain—but they’re most commonly artificial intelligence or fintech startups. Interestingly, however, the majority of entrants in our list of top Scottish tech startups below are operating in the healthtech space, including precision medicine, pharmaceutical and biotech companies.
A large proportion of high-growth Scottish technology companies are early-stage tech startups, with 50% currently operating at the seed stage (typically small businesses, with low employee count, valuation and funds raised). Meanwhile, 29% are at the venture stage of evolution, 8% are growth-stage companies and 13% established-stage.
When it comes to Scottish tech founders, a disappointing 80% of the region’s high-growth technology companies have all-male founding teams. This imbalance is not unique to just Scotland—among all high-growth UK tech companies, the same proportion (80%) were founded by all-male teams. Outside of the tech sector, these figures are closer to 67% and 72%, respectively. Clearly, there’s still a long way to go across the high-growth ecosystem, but particularly within UK tech.
High-growth Scottish tech companies have secured 2,391 equity rounds since 2011, worth a combined £3.06b in announced and unannounced rounds. These funding rounds had an average value of £1.31m, and the vast majority of investee companies were operating at the seed (46%) or venture (42%) stages at the time of fundraising.
Equity investment into Scotland’s tech sector has grown considerably over the last decade, from just 60 announced deals in 2012 to a peak of 215 in 2020. Deal volume dipped slightly in 2021, with only 171 equity rounds announced during the year. Having said that, deal value continued to grow, with a record £454m worth of announced equity fundraisings in 2021—nearly double the amount raised in 2019 or in 2020. And this trend looks set to continue this year, as a massive £312m of equity investment was announced by Scottish tech companies in H1 2022 alone.
The biggest Scottish equity deal to date was BorderLink’s £164m equity and loan round, in January 2022. The rural household and SME broadband provider secured funding from the British Strategic Investment Fund, to advance its full fibre broadband roll out to 500k homes in Scotland and the North of England. Other very active investors in the Scottish tech ecosystem include Par Equity, Scottish Enterprise, angel network Archangels, and the University of Edinburgh’s Old College Capital venture fund.
We’ve ranked the top private tech startups in Scotland, in order of the amount of equity investment they’ve raised to date. Each of these ambitious businesses is currently operating at the seed stage of evolution. Among those featured, eight are academic spinouts and nine are life science companies. Read on to discover 15 early-stage Scottish tech startups to keep an eye on this year.
Amount raised: £50.0m
Amphista Therapeutics develops pharmaceuticals that are designed to use targeted protein degradation to hijack and suppress cells responsible for disease progression. The company was spun-out of the University of Dundee in 2018, and now has its headquarters in Motherwell, North Lanarkshire, as well as a London office.
Amphista Therapeutics has raised £50.0m in equity investment so far, across three funding rounds. Its most recent fundraising, in March 2021, saw participation from Advent Life Sciences, US funds BioMotiv and Eli Lilly & Co, Swiss VC Novartis Venture Fund, and Dutch venture capital funds Forbion Capital Partners and Gilde Healthcare Partners. The new influx of capital will help the company to accelerate its growing pipeline of potent and selective bifunctional molecules (known as ‘Amphistas’).
Amount raised: £43.6m
Edinburgh-based Resolution Therapeutics develops cell therapies that are intended to help treat liver diseases in their final stages. In order to help the medical community meet the unmet regenerative therapeutic needs associated with chronic liver diseases, the company’s services include researching the use of macrophages as therapeutic agents, to treat liver cirrhosis and other illnesses.
The company was incorporated in December 2017 and spun-out of the University of Edinburgh three years later. Backed by Syncona Partners, Resolution Therapeutics has raised £43.6m in equity investment so far, across three funding rounds. Its most recent fundraising was a £15.6m unannounced equity deal, in January 2022.
Amount raised: £20.8m
Mironid develops therapeutic drugs for cancer, chronic inflammatory diseases, and degenerative kidney diseases. The Glasgow-based company creates high-value therapeutics that address unmet medical needs, by modulating the activity of essential cell-signalling proteins.
The University of Strathclyde spinout was founded in 2014. It has since been awarded £560k worth of grant funding from Innovate UK. On top of this, Mironid has also raised £20.8m in equity investment, across eight funding rounds. The company secured its latest fundraising in October 2021—the £7.30m equity and loan investment saw involvement from Epidarex Capital, Scottish Venture Fund, Sofinnova Partners, and Biogeneration Ventures.
Amount raised: £16.3m
Edinburgh-based AI startup Emotech develops robotic technology. Its first product, Olly, is a personal robot that develops a ‘personality’ based on interactions with its owner, using machine learning. Olly’s AI engine is powered by cutting-edge technology developed by Emotech’s team of neuroscience and machine learning researchers.
Emotech has raised £16.3m in equity investment so far, across two funding rounds. Its latest fundraising was completed in December 2017, and saw the company secure £8.65m from undisclosed investors. Emotech has also attended two accelerator programmes so far: Tech Nation’s Upscale accelerator for high-growth tech companies, and the Mayor’s International Business Programme.
Amount raised: £15.6m
BetDEX Labs is a tech startup and decentralised sports betting platform that uses the Solana blockchain. Once released, third parties will be able to create their own applications and innovate on top of the platform, due to the protocol’s decentralised and open-source nature. At launch, BetDEX intends to accept bets in the USDT, SOL and SAMO cryptocurrencies.
The fast-growing crypto startup is based in Edinburgh and has secured one equity fundraising so far—a £15.6m round with investors including Solana Ventures, Lightspeed Venture Partners, Hack VC, and Sino Global Capital. The company announced that it would use these funds to develop its betting platform and make new hires.
Amount raised: £9.94m
Also based in Edinburgh is Caldan Therapeutics, which is developing a new treatment for Type-2 diabetes. The company targets a variety of T2D pathophysiology issues, such as insulin secretion, insulin sensitivity, islet cell protection, and anti-inflammatory activity in muscle, liver, and adipose tissue, allowing patients to have glucose-lowering agents in their bodies.
Founded in 2015, Caldan Therapeutics is a University of Glasgow spinout. It has raised £9.94m worth of equity investment so far, across five funding rounds. The company’s most recent fundraising was a £1.69m equity and loan round, in February 2021, with Epidarex Capital, LifeArc, and Scottish Enterprise.
Amount raised: £9.89m
Inverness-based healthtech company ODx Innovations develops technology to aid in identifying antibiotic resistance in UTIs. The company specialises in testing for antibiotic sensitivity, allowing doctors to quickly and effectively make crucial decisions about patient treatments.
Spun-out of the University of St Andrews in 2016, ODx Innovations has been awarded innovation grants from Scottish Enterprise and Highlands and Islands Enterprise, as well as from the Longitude Prize Discovery Awards. The innovative tech startup has also secured £9.89m of equity investment, in one seed funding round with Bio-Rad Laboratories.
Amount raised: £8.55m
Invizius develops The H-Guard Priming Solution, medical technology that aims to eradicate side effects when conducting hemodialysis. The pioneering solution contains a novel protein that lines the dialysis filter, enables dialysis to proceed without being noticed by the body’s immune system, and suppresses the blood’s response to foreign bodies.
The Motherwell-based healthcare tech company was spun-out of the University of Edinburgh in 2017. Since then, it has received three large innovation grants, totalling £1.62m, alongside three equity investments, worth a combined £8.55m. The company’s latest equity round, in March 2021, was a £5.30m deal with numerous funds, including Access EIS, Calculus Capital, and Downing.
Amount raised: £7.55m
Edinburgh-based AdoRx Therapeutics is researching new cancer therapeutics. The company focuses on medications, specifically adenosine pathway modulators for the treatment of cancer, allowing the medical community to properly treat cancer patients.
AdoRx Therapeutics was founded in 2017 by Pete Finan, former head of the Novartis Institutes of BioMedical Research UK site. The company has secured one equity fundraising so far, worth £7.55m, in June 2018. It received backing from CRT Pioneer Fund and Epidarex Capital, to accelerate efforts to discover new forms of cancer therapeutics.
Amount raised: £6.50m
Kynos Therapeutics develops pharmaceuticals designed to treat patients with uncontrolled inflammation. The company’s medicines are aimed at inhibiting Kaiser-Meyer-Olkin (KMO), a key enzyme at the interface of inflammation, immunity and metabolism. Kynos Therapeutics is a University of Edinburgh spinout and is still headquartered in the city.
In February 2022, Kynos Therapeutics secured its first funding round, a £6.50m equity and loan investment. These new funds will be used to support the company’s KMO inhibitor programme through clinical trials, to build out its core team, and to fund further preclinical work. The round saw participation from Epidarex Capital, IP Group and the Scottish Co-Investment Fund.
Amount raised: £6.09m
Fellow Edinburgh-based tech startup Brainnwave develops AI-enabled data analysis software, for business consultancy purposes. The SaaS company collaborates with clients in the public, private and non-profit sectors, to determine how specialised tools, algorithms and tech can give them a sustainable competitive advantage. It creates automation technologies that help clients to curate, analyse and visualise their data.
Founded in 2019, Brainnwave has raised two equity funding rounds so far, worth £6.09m in total. Much of this investment came from its November 2021 deal with Hatch, in which Brainnwave secured £6.00m to help increase its headcount by 100 people. Through the Series A round, Brainnwave and Hatch also formed a business partnership (or ‘co-venture’) to create products and applications that combine their respective expertise.
Amount raised: £6.00m
BioClavis is a healthcare-focused tech company based in Clydebank, West Dunbartonshire. It was spun-out from US molecular profiling company BioSpyder Technologies in 2017. BioClavis received a £6.00m equity investment from BioSpyder at the time, to adapt its TempO-Seq technology into a novel diagnostic tool, in close collaboration with health services and university researchers.
Now, BioClavis is using this TempO-Seq technology as a genomic diagnostic tool in the field of precision medicine, aiming to provide personalised, cost-effective healthcare. On top of its existing equity investment, the company has since been awarded more than £7m worth of innovation grants, from Scottish Enterprise, Horizon 2020 and Innovate UK schemes.
Amount raised: £5.93m
Chemify provides digital hardware and software for application in chemical processing. Its software includes a scripting language, natural language translation for synthetic procedures, and a comprehensive ontology that enables simple process creation with insight into reaction conditions and problem-flagging, giving scientists access to detailed real-time reaction telemetry.
The University of Glasgow spinout was founded in 2019, and has since gone on to raise a total of £5.93m in equity investment, across two funding rounds. The most recent of these was a stealth round completed in February 2022, and brought in £5.72m. Chemify’s Founder and CEO, Lee Cronin, is the University of Glasgow’s Regius Professor of Chemistry.
Amount raised: £5.82m
Also headquartered in Glasgow is HV Systems, which develops zero emissions hydrogen fuel trucks for the transport industry. The green technology company collaborates with top tech integrators, component suppliers, and vehicle prototype design firms, to provide innovative solutions to decarbonise the medium and heavy-duty commercial vehicle sectors.
Founded in 2017, HV Systems has raised £5.82m of equity investment so far, across three funding rounds, plus £399k in Innovate UK grants. The company’s most recent fundraising was completed in July 2021, and saw Beehive Equity invest £5.00m. Co-founders Abdul Waheed and Jawad Khursheed plan to use this funding to become the UK’s first hydrogen-powered vehicle producers.
Amount raised: £5.50m
Fellow cleantech startup Agricarbon develops soil carbon management technology. The Dundee-based company specialises in lab analysis, and uses robotics and AI to automate the process of calculating the soil carbon stock. This lowers the cost for customers of carbon stock validation.
Between 2020 and 2021, Agricarbon attended Unlocking Ambition, an accelerator programme set up by the Scottish Government to support entrepreneurs looking to contribute to Scotland’s transition to net zero. Having received a £25.0k grant from Unlocking Ambition in October 2020, the company went on to raise two equity funding rounds, from numerous investors. In total, it has secured £5.50m of equity investment.
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