finance

Scotland comes top for equity business deals outside London



Small Scottish businesses raised more in equity finance than any in any other part of the UK outside of London last year, according to the British Business Bank.

Its annual Small Business Finance Markets report revealed that there were 242 equity deals in Scotland in 2020, which was 12% of the UK total.

London, with 965 deals, made up 47% of the total, with the South East of England in third at 188.

Scotland’s proportion of UK high growth businesses was 6%. The number of transactions was double this, suggesting an increase for equity deals in the business community.

In 2019, equity finance deals in Scotland represented 11% of the total UK figure.

The figures come after increased Initial Public Offering (IPO) and crowdfunding activity in Scotland.

Calnex was the first Scottish IPO in two years when it made its market debut in October, followed by AMTE Power and Parsley Box.

TC BioPharm, Pawprint, and Celtic Renewables have all also completed crowdfunding campaigns in recent months.

Despite the number of equity deals, Scottish businesses accessed a comparatively low share of the total investment value at just 3% – £283m.

London attracted two thirds (£5.8bn) of equity finance, while equity investment in the South East represented 9% (£792m) and the East of England 7% (£595m).

Mark Sterritt, UK network director for devolved nations at the British Business Bank, said: “It is encouraging to see so many smaller businesses in Scotland use equity funding as a tool to grow their businesses, highlighting the rich ecosystem that is emerging.

“The lower value of deals in Scotland, nevertheless, suggests businesses may not be raising all the finance they need to continue on their growth journey and so we continue to work to raise awareness amongst smaller businesses of the finance options available to them.”

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