Despite a difficult two years due to the pandemic and the impact of Brexit, Scottish companies have continued to see strong growth and gain access to extra funding.
Sectors such as banking, e-commerce, space and life sciences all saw substantial funding boosts.
In this article, we’ve rounded up our biggest deals from each month of the year in 2021, so you can see how the Scottish business landscape has fared over the last 12 months.
January – Royal Bank of Scotland
Royal Bank of Scotland (RBS) announced in January that it would invest an additional £100 million in funding to support female Scottish entrepreneurs in the wake of the coronavirus pandemic.
Funding for female entrepreneurs was made available over the next four years and aims to help businesses across the country to scale and grow.
The announcement followed an earlier pledge to support female entrepreneurship. In January 2020, RBS announced a £1 billion programme in response to findings in the Alison Rose Review of Female Entrepreneurship.
Since its launch in January 2020, the funding programme has experienced enormous demand. In response, an additional £1 billion of debt funding has been made available, with £100 million of this targeted specifically at Scottish companies.
Commenting on the funding package, RBS Chief Executive Alison Rose said: “All of us, from ministers to employers, have a duty to ensure that further pain isn’t felt disproportionately by women and that anyone who retains an ambition to start or grow a business is helped with targeted and innovative assistance.
“We’re determined to play our part and I’m pleased to confirm that we are now able to launch a second tranche of funding to continue and extend our support to female entrepreneurs and business owners.”
Rose continued: “As we build a purpose-led bank that champions the potential of people, families and businesses up and down the country, we are committed to supporting the UK’s recovery from the crisis.
“However, if women find themselves at even more of a professional disadvantage on the other side of this crisis, then we’ll be attempting to build an economic recovery whilst ignoring a huge area of potential.”
Small Business Minister and Co-Chair of the Rose Review Board, Paul Scully, added: “It is fantastic to see a large company like NatWest doubling its support for female-led businesses to £2bn, giving a lifeline to thousands of companies as we build back better from coronavirus.”
February – Heriot-Watt University & UKATC
The project received over £890,000 in funding from the UKRI Science and Technology Facilities Council to pursue two main areas of research.
Funding enshrined Edinburgh as a “world centre for astrophotonics,” and allows researchers to focus on developing new optical components.
Professor Robert Thomson, head of Heriot-Watt’s Photonic Instrumentation Group said: “We find ourselves at a point where conventional approaches to optical instruments like telescopes are reaching their limits.
“Astrophotonic technologies offer a route to circumvent these limits and help astronomers discover more about our universe.
“Our aim is to use advanced photonic manufacturing techniques to fabricate optics that are not limited in their shape like normal optics. In the long term, this will allow astronomical instruments that are more efficient and lower cost.”
Professor Derryck Reid, head of the Ultrafast Optics Group at Heriot-Watt, added: “We’re going to demonstrate a new class of small, ultra-stable lasers that will provide a ‘ruler’ for the wavelength of light.
“This will allow astronomers to measure the wavelength of starlight extremely precisely, and in a way that allows comparisons over years and even decades.
“The wavelength signatures of starlight can reveal exciting information about questions such as whether life exists on exoplanets, or if the fundamental constants of physics are in fact changing by tiny amounts,” he commented.
The three-year project aims to demonstrate new research and builds on sustained funding to Heriot-Watt from the STFC and other funding organisations such as the EU over the past decade.
It will also support work that is taking astrophotonic technology to the higher technology readiness levels needed for deployment on major international projects like the Extremely Large Telescope.
March – LumiraDx
Life sciences firm LumiraDx announced it would lead the creation of a new global health research, development and manufacturing hub and announced a £78 million investment in its current Scottish operations in March.
Supported by a £15 million grant from Scottish Enterprise, the posts would be located at sites across Stirling, Inverness and a new facility under construction at Eurocentral, near Glasgow, at the time.
A total of 510 new posts will be generated over the next three years as a result of the investment. Long-term, the firm is hopeful this could rise to more than 750 new posts.
LumiraDx said the new jobs will scale up manufacturing, as well as the development of a range of other tests.
Chief Executive Ron Zwanziger said: “Implementing reliable Covid-19 diagnostic testing programs, that provide rapid results with minimum false negatives, is critical to safely reopening the economy.
“We are pleased to contribute to Scotland’s health and economic growth, now and beyond the pandemic.
“We are also delighted to be increasing our footprint in Scotland and expanding the country’s life sciences industry. Next-generation point of care testing technology can help to transform healthcare systems.”
Zwanziger added: “It’s an exciting undertaking, and we know to do this quickly and to do it well we need the right infrastructure in place and access to incredible talent to drive this development.
“Scotland has both. We are proud to be investing in the country, and its communities and grateful to Scottish Enterprise for their support through this grant.”
April – Exscientia
Exscientia, a spin-out from the University of Dundee, completed a $225 million Series D funding round in April this year.
Led by SoftBank Vision Fund 2i, the Series D funding round was also joined by previous investors in Exscientia, including Novo Holdings and funds managed by Blackrock.
The funding boost followed a successful Series C round last summer which saw the pharmatech company raise $100 million.
Eric Chen, Managing Partner of SoftBank Investment Advisers, commented: “We believe Exscientia’s innovative use of AI to discover and design better quality drugs with greater efficiency has the potential to create important medicines faster than ever before.
“With the convergence of technology and biology, drug discovery is rapidly evolving in ways that will reshape the industry. The Exscientia team have been leaders in AI-based drug discovery since the field’s inception and we believe they will continue shaping its future.”
Funding from the investment round will be used to expand Exscientia’s drug discovery platform and advance the company’s proprietary pipeline through clinical testing.
Other investors in the Series D include Mubadala Investment Company, Farallon Capital, Casdin Capital, GT Healthcare Capital, Marshall Wace, Pivotal bioVenture Partners, Laurion Capital, Hongkou and Bristol-Myers Squibb
SoftBank announced it will also provide an additional $300 million equity commitment that can be drawn at the firm’s discretion.
Andrew Hopkins, CEO of Exscientia said: “All of our investors share Exscientia’s vision to discover better drugs, faster, through AI and automation. Our patient-first AI platform has repeatedly demonstrated its ability to precision design drugs that address patients’ needs.
“With the Series D completed, the quality and depth of our shareholder base allows us the freedom to continue to scale both our platform and pipeline.
May – Recast
Edinburgh-based sports video content platform Recast secured $8.2 million (£5.9m) in funding as part of a series A investment round in May 2021.
The investment saw funding secured from a host of high-profile investors, including West Indies batsman Chris Gayle and Simon Bax, former Chief Financial Officer and Executive Vice President at Pixar.
Other investors in Recast include Riva Technology and entertainment and private equity firm Visor International.
The investment round saw Recast’s valuation grow to $29m (£20.9m). The firm said the money raised would primarily be used to further develop its platform.
Recast added that it will invest in “expanding its geographical footprint” as an increased appetite from rights holders indicates “significant demand” to reach a global audience.
Commenting on the investment, Recast CEO and founder Andy Meikle said: “The calibre of this investment group reflects the response from the rights holders around the world and Recast’s major potential, particularly as we’re just getting started.
“We’re often congratulated on how ‘disruptive’ our model is, but in our view the industry has already been disrupted and we’re providing a revolutionary solution.”
June – Q2 Solutions
Scotland announced the strengthening of its reputation in life sciences after the announcement of a global centre of excellence in West Lothian in June.
US clinical research company Q2 Solutions announced a multi-million-pound inward investment at its Livingston campus, creating 156 skilled jobs over the next three years.
Supported by a £3.8-million Scottish Enterprise grant, Q2 said it would establish a centre of excellence in flow cytometry and genomics testing and analysis, enabling it to offer an increased range of services.
The multi-million-pound research and development project would help “anchor” the firm’s operations in Scotland and sit alongside an ongoing £17-million infrastructure expansion project at the campus.
Commenting on the news, Elaine Lowey, Q2 Solutions’ General Manager for Europe, the Middle East and Africa, said: “I am delighted to lead such a momentous undertaking.
“Expanding our European operations in key technical areas supporting the development of new precision medications adds significant value to our global pharmaceutical and biotechnology clients.
“We are delighted to be working with Scottish Enterprise in this venture and look forward to the job creation this will bring in our new state-of-the-art facility.”
July – Snappy Shopper
In July, online home delivery service Snappy Shopper raised £19.4 million in funding as the company looked to capitalise on increased demand for local home deliveries this year.
Led by Kelvin Capital, the deal saw funding from a range of new and existing investors, including Maven Capital Partners, Scottish Enterprise, Highland Tech and former Sainsbury’s CEO Justin King.
PayPoint also invested £6.6m in the Dundee firm, which announced a new commercial partnership with PayPoint, enabling thousands of retailers to implement their own home delivery and click and collect services.
Following the investment, Snappy Shopper said it planned to create 400 jobs over the next three years and move to a new headquarters.
Mike Callachan, CEO and co-founder of the Snappy Group said: “Demand for the fundraise exceeded our expectations and we are pleased to have attracted such high-profile investors and advisers.
“The proceeds will significantly accelerate our next phase of growth across the UK, including investments in new services for our retail and hospitality partners and new hires across the business.”
Kelvin Capital founder John McNicol added: “Having supported Snappy from its inception through our network of connections and fundraising, we are delighted with the exceptional performance to date.
“It is and always has been a very exciting tech proposition and the investing partners joining us on this journey are testament to the ambition of the team.”
August – DigitalBoost Fund
A fund aimed at helping businesses adopt digital technologies received an additional £25m backing from the Scottish Government in August.
The DigitalBoost Fund, jointly led by Business Gateway and the Scottish Government, launched in January this year and offers small to medium-sized businesses grants worth up to £25,000.
In a statement, the Scottish Government said the additional investment would allow businesses to adopt the tech and skills needed to increase their competitiveness, productivity and resilience.
Commenting at the time, Economy Secretary Kate Forbes said: “The Covid-19 pandemic has demonstrated just how important digital technologies are for businesses.
“I am delighted that so many businesses have adapted to working with new technology and innovated how they work at great pace.
“This additional £25m investment in the DigitalBoost Fund will support even more businesses to invest in their digital capacity.”
Forbes added: “This 100-day Scottish Government commitment reinforces our determination to support businesses to improve their digital skills and technologies to ensure they can help drive forward our economic recovery and support net-zero.”
Councillor Steven Heddle, Chair of Business Gateway and COSLA spokesperson for the Environment and Economy commented: “Scottish local government is again delighted to welcome the DigitalBoost Development Grant Scheme.
“Together with the existing free expert advice and online support from both DigitalBoost and the wider Business Gateway service, available across Scotland as part of the business support councils provide locally, this grant will help Scottish businesses strengthen, advance and rebuild their platforms, processes, systems and people to help local economies thrive.”
September – Scottish Enterprise
Scottish entrepreneurs gained £36m in investments through the Scottish Enterprise ‘Unlocking Ambition’ programme in September.
The programme, launched in 2018, had helped 107 Scottish entrepreneurs from 79 firms generate millions of pounds of new direct investment.
Firms gained £7.4m revenue growth, including £3.9m in international turnover growth, creating almost 150 jobs across Scotland.
Over the next three years, those involved with Unlocking Ambition are projected to cumulatively reduce Scotland’s carbon emissions by up to 7,468 tonnes.
Unlocking Ambition also gained a further 38 new entrepreneurs who Scottish Enterprise said were chosen, “for their individual potential, the quality of their ideas, ability to scale and their contribution to the Scottish economy from sustainable growth through investment, innovation and exporting”.
Commenting on the news, Director of Growth Investments at Scottish Enterprise, Kerry Sharp, said: “These are fantastic achievements that demonstrate what supporting entrepreneurs through a high value, tailored programme can produce.
“Scottish Enterprise is proud of its role in helping deliver such positive results which have an impact on people and regions across Scotland.
“A £5.6m commitment that has so far returned £36m of direct investment to date represents incredibly great value for taxpayers’ money, even before we see the results from the latest group of entrepreneurs.”
October – Xergy Group
Aberdeen-headquartered Xergy Group secured £4.25m from a Series A+ fundraiser in October to scale-up its software as a service (SaaS) work automation management software.
This Series A+ fundraiser was carried out at a pre-money valuation of £15m – a 75% uplift on the previous 2019 round.
The raise saw follow-on investment from a majority of existing investors, including an additional £1m investment from Scottish Enterprise, which has previously supported the company with a Research and Development Grant of up to £425,000 and Early Stage Growth Challenge Fund investment.
Commenting on the investment, Kerry Sharp, director of growth investments at Scottish Enterprise, said: “The growth of Xergy highlights the entrepreneurial talent and innovation within Scottish early stage businesses.
“The technology is being used globally and creating employment opportunities for energy professionals across Scotland and this new round of investment will allow the firm to reach further across new markets as well as industries and continue to help organisations remain competitive.”
James McCallum, founder and chairman at Xergy, added: “We are delighted to today be announcing the successful close of our fundraise. The last few years of developing Xergy have been incredibly enlightening, and this investment is a great result of the effort of the team.
“We are focused on developing products that are aligned with the essential need of businesses to embrace both the energy transition and digital transformation.”
November – Intelligent Growth Solutions
Scottish agritech startup Intelligent Growth Solutions (IGS) raised £42.2 million as part of an oversubscribed Series B funding round.
The latest funding round brought the total investment in IGS last month to more than £52m, and was supported by Swiss, US and Scotland-based investors.
For Swiss investment firm COFRA, which led the round, this marked the first investment into sustainable food systems and agritech as part of a strategy to contribute to the food system transition.
IGS Chief Executive David Farquhar commented: “The conclusion of a hugely over-subscribed Series B round represents another exciting step for IGS and our investors.
“We have been supported with this investment by well-established, globally recognised and highly ethical investors in COFRA, Cleveland Avenue and DC Thomson, who understand the transformational potential of our technology for controlled environment agriculture.”
December (as of writing) – Scottish Enterprise
Economic development agency Scottish Enterprise announced that £10.7m has been approved for 43 projects involving capital investment of £61.6m.
More than 750 green jobs are expected to be created and by the projects.
The awards were made via the agency’s Green Jobs Call, part of the Scottish Government’s £100m Green Jobs Fund. Grants ranging from £50,000 to £500,000 were made available through the call.
Businesses that apply for funding had to demonstrate they will create or safeguard jobs that relate directly to the transition to net zero or minimise environmental impacts by developing sustainable low-carbon products or services.
Grant recipients include Dundee-based sustainable cities consultancy Urban Foresight. The company is investing £2.6m in the expansion of its consultancy teams focused on electric vehicle charging, new mobility services, net zero economic development, digital infrastructure, and local government services, supported by a £400,000 grant.
Commenting on the announcement, Adrian Gillespie, CEO of Scottish Enterprise, said: “This round of funding shows our commitment to supporting Scotland’s transition to a greener and fairer economy, and to creating good green jobs.
“The wide range of projects highlights the increasingly innovative approaches businesses are taking to answering the net zero call, whether that’s creating new products and services, or developing and adapting existing approaches to mitigate their environmental impact.”
Just Transition Minister Richard Lochhead added: “To secure a truly just transition we must invest in our green industries now – creating and supporting the green jobs that will be vital in helping Scotland to become a net zero nation. In doing so, Scotland’s businesses have the opportunity to be at the forefront of this new green revolution.
“Helping businesses achieve a just transition will be a theme of this week’s Budget and the £100 million Green Jobs Fund is an integral part of that process. Over the next five years, the funding will support businesses to create green jobs and a better transition to a low carbon economy.
“I’m delighted to see this first tranche of funding being announced today. The projects awarded funding to date demonstrate the exciting opportunities being created by the green revolution our economy is undergoing.”