The life sciences sector became the most popular destination for equity investment into tech-focussed smaller businesses in Scotland last year, as the pandemic increased interest in healthcare technology.
British Business Bank analysis of Beauhurst data on the equity markets showed that that investment in Scotland’s smaller life sciences companies reached £61m during the first nine months of 2021 – 42% higher than the £43m made in the whole of 2020.
Equity investment into smaller businesses in Scotland’s technology industry as a whole reached £163m by the end of the third quarter of 2021, 36% higher than 2020’s total of £121m.
Life sciences was ahead of software for investment in smaller businesses in Scotland’s technology sector, representing 37% of the total figure. Software accounted for £37m - a 23% share - during the nine months to the end of September 2021 – on track to exceed the £43m total for 2020.
Overall, tech-focussed smaller businesses saw investment rise 36% in 2020 in just the first nine months of 2021, with cleantech quadrupling in the build up to COP26.
The findings follow the British Business Bank’s Small Business Finance Markets report, which showed that total equity investment in Scotland’s smaller businesses reached £403m during the first three quarters of 2021 – exceeding the entire previous year’s £279m by 44%.
Mark Sterritt, UK network director for Scotland at the British Business Bank, said: "It is highly encouraging to see a significant increase to equity investment in Scotland’s smaller tech businesses.
"Although there are clear headwinds in the form of cost inflation, supply chain pressures, and geopolitical tension, 2022 will hopefully see a return to more normal trading conditions as the year progresses.
"With that, we would also hope to see more companies switch to focus on growth having understandably been in survival mode for much of the past two years."
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