New research reveals that Edinburgh-based businesses have secured 2.7% of UK funding rounds in Q1 to Q2 of 2024, however have seen a 17% decline from the same period last year, as the global investment market cooling amid broader market uncertainties.
The ‘Global Investment Report’, by sharetech platform Vestd, analysed Crunchbase data to assess the scale of global investment in 2024 and identify trends in the private equity sector across a range of regions and industries.
Businesses in Edinburgh secured 65 funding rounds between Q1 and Q3 of 2024, a 17% decline from the same period in 2023, signalling a tougher environment for startups.
As the capital and main business hub, it is unsurprising that London still leads UK investments, despite a decline since Q1, however outside of London there have been spikes in funding rounds this year, with Cumbria and Liverpool reporting a 85.7% jump and 70.6% rise respectively.
Overall, while the UK accounted for 6.6% of global funding rounds, investment in early-stage businesses has slowed across the country, with funding rounds down by just under a third year-on-year.
Between Q1 and Q3 of 2024, the total number of funding rounds globally reached 36,203 – marking a decline of more than 25% from the same period last year.
This comes after the first International Investment Summit, where a reported £63 billion of private investment has been committed, and included partnerships in key sectors such as infrastructure and tech.
As the capital of England and a major business hub, it is unsurprising that funding activity remained largely concentrated in London, with 1,230 funding rounds in total between Q1 and Q3 of 2024. However, while Q1 showed a promising start with 474 total funding rounds, activity had cooled by 29.1% by the end of Q3.
Manchester and Edinburgh followed behind London in second and third, however had much lower funding rounds than the capital with 72 and 65 respectively in 2024. Both cities also saw a decrease in funding rounds compared to the same period last year.
Whilst Liverpool was only ranked 7th for number of funding rounds, it was the only city in the top 10 that reported a rise in funding, seeing an impressive 70.6% increase since the same period last year.
Regionally, Wales and Cumbria both had significant increases in their year to date funding rounds, with 133.3% and 85.7% increases respectively.
Commenting on the findings, Ifty Nasir, CEO of Vestd, said:
“We are at a critical juncture in the global investment landscape. As funding struggles to regain momentum following broader market uncertainties, investors have become more selective, leading to many sectors observing a downward trend in funding, with early-stage funding hardest hit.
“This shift in the investment market presents a unique opportunity for founders to refine their value propositions and become resilient in demonstrating their growth potential and market fit. Increasingly, investors are focused on businesses that not only present a clear path to profitability but also align with key market drivers like operational efficiency and innovation. The ongoing surge in investment in sectors such as artificial intelligence represents the wider global trend towards digital transformation.
“With how competitive the funding landscape is, founders need tools that ease the process, allowing them to focus on wowing potential investors. That is why, as a direct response to these challenges, we have launched our new fully integrated platform InVestd Raise, to offer a simpler and more accessible approach to navigating funding challenges – helping founders to launch, raise investment, grow, mature and then cash in on their success, along with their teams!”
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