Edinburgh: The lowdown on Scotland’s startup hotspot

Perhaps it’s Edinburgh’s world leading universities, its rich history of innovation, or even its status as a cultural hub that has led to Edinburgh’s reputation as a beacon of the UK startup scene.  

Over the past five years, the Scottish capital has attracted more than $1B in investment. As of 2022, a record 67,500 people were employed in Edinburgh’s tech sector, valued at $6.4B (£5.5B), up from $5.6B in 2021. 

Edinburgh is at the centre of a startup revolution in Scotland. The region was recently named one of the UK’s most innovative clusters. Since 2011, they’ve seen more than 475 equity deals worth £710M, with a primary focus on technology and IP-related businesses. This includes two UK unicorns born in Edinburgh: SkyScanner and FanDuel. SkyScanner is largely considered one of Scotland’s most successful tech firms and was acquired by Chinese travel giant, Ctrip.com in a deal said to be worth £1.4B. The region is also home to a rising number of pioneering startups including NuCana, BioMed and Roslin. 

Here we break down everything startup founders need to know about Edinburgh, from capital to talent to entrepreneurial networks.

Tapping into Edinburgh’s vibrant VC network

Founders of spinouts, startups, and scaleups alike will find no shortage of investors to back your business. 

Archangels has been an instrumental player in Scottish tech, funding early-stage tech and life science companies in Edinburgh and across Scotland. It is an angel syndicate comprising more than 120 investors, investing more than £10M a year. 

Par Equity is another important investor in the region, backing businesses at Series A in Edinburgh as well as Scotland, Northern England, and Northern Ireland. Since 2008, it has backed 78 companies, raising over £450M in funds. While sector agnostic, many of their investments sit across medtech, climatetech, AI, and hardware. 

Pentech Ventures is another Edinburgh-based firm. Led by a team of ex-entrepreneurs, Pentech has more of a software focus and has invested early on in businesses like Nutmeg (sold to JP Morgan), FanDuel, and more recently in PrimaryBird and Monolith.

For earlier stage founders, there are a number of incubators and accelerators in Edinburgh. CodeBase is the largest technology incubator in the UK, and with a hub in Edinburgh, they offer support, networking, and investment to nascent tech companies. 

The University of Edinburgh offers a number of accelerators to early stage businesses, including their recently-launched AI Accelerator and a Startup Summer Accelerator for businesses addressing any of the UN’s Sustainable Development Goals. 

Hiring from world-renowned talent centres

Edinburgh’s three main educational institutions are a wellspring of top graduate talent, providing an exceptional base for startups and scaleups alike. 

The University of Edinburgh is one of the top universities in the country, and has long been able to draw in students from around the world (44% of its student population is international). It has a strong reputation for engineering (ranked in the top 100 globally by Times Higher Education), life sciences, and entrepreneurship, with four spinouts named in a 2022 list of Scotland’s Top Startups. The university even has its own VC fund, Old College Capital, which provides investment and commercialisation support to many of the university’s ventures. 

Also in Edinburgh, you’ll find Heriot-Watt University which has a strong engineering and technology focus. It is home to Edinburgh Business School, Scotland’s largest business school, while Civil and Structural Engineering courses are ranked in the top 150 in the QS World University Rankings. Heriot-Watt is also home to the National Robotarium: a development and testing site for robotics and AI across Robotics and Autonomous Systems (RAS), Human and Robot Interaction (HRI), and High-Precision Manufacturing. Edinburgh Napier University, meanwhile, has a stellar reputation for entrepreneurial students. Their in-house incubator has supported more than 500 startups.

Edinburgh’s collaborative community of entrepreneurs

Over recent years, Edinburgh has seen the emergence of numerous organisations, communities, and hubs that support entrepreneurs at all stages. 

Scottish Enterprise, Scotland’s national economic development agency, is a leading figure in Scottish tech and is at the heart of Edinburgh’s entrepreneurial community. They offer financial support and advice to businesses, with a focus on fostering innovation and growth in the Scottish economy. Edinburgh Chamber of Commerce and Scottish Chambers of Commerce, both located in Edinburgh, fulfil similar functions for businesses: bringing together a wide reaching community of founders for support, advice, and networking.

There is a growing community of deep tech and life sciences businesses built around certain hubs in the capital. Edinburgh BioQuarter is one of the UK’s leading innovation locations and a centre of excellence for life sciences research and development. It was one of the first places in the UK to co-locate academic research, clinical delivery and commercial research at scale and it hosts a community of over 8000 people who work and study in the city.

Similarly Midlothian Science Zone, which launched in October 2016 in the outskirts of Edinburgh, is a centre of research excellence in animal health and life sciences. It brings together a huge community of animal science expertise which is known for its willingness to collaborate.

Edinburgh’s community of female founders is well-catered for too. The Association of Scottish Businesswomen has been around nearly three decades to support personal and professional development of women and business owners, while Women’s Enterprise Scotland is building an environment conducive to women’s success in Edinburgh and Scotland. 

Edinburgh has established itself as a leading UK hub due to a robust ecosystem, bolstered by world-class universities, numerous tech incubators and accelerators, and its deep culture of entrepreneurship and innovation. This makes it an attractive destination for startups and is why the Scottish capital continues to attract the best and brightest minds from across the world to work, study and live. 

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