Growing Scotland's entrepreneurial economy and A Closer Look Beyond The Words

24th January 2026

A new £2.5 million package to nurture more young entrepreneurs is part of record £45 million investment to drive innovation, enterprise and entrepreneurship across Scotland in 2026-27.

The draft Scottish Budget supports investment in people and businesses at every stage of their journey, from continued investment to encourage those from disadvantaged or under-represented backgrounds to start and grow businesses, to tailored support for companies scaling up.

There will be further funding for the Scottish Government's Techscaler programme, which has over 1,900 members across more than 1,400 startup and scaleup businesses.

Deputy First Minister Kate Forbes visited Galashiels to meet business founders who have been helped South of Scotland Enterprise's Pathways Pre-Start programme.

The pilot programme is now in a second phase following a successful pilot in 2024-25 and has so far delivered specialist coaching to over 700 existing or prospective business founders, leading to over 220 new businesses being created.

The Deputy First Minister said:

"The Scottish Budget 2026-27 continues our support for the innovation and entrepreneurial talent that is the backbone of any prosperous, growing economy. We have been working systematically to develop the pipeline of support required to help businesses develop, grow and prosper.

"Scotland is one of Europe’s most dynamic start-up economies, outpacing the UK, and we are making clear progress in establishing the right conditions to help business founders succeed. I expect this progress to accelerate as we invest record funding in helping start and scale Scottish business talent."

Chief Entrepreneur Ana Stewart said:

“Scotland is making progress toward becoming an entrepreneurial nation, establishing strong foundations for those starting their businesses. This year’s budget strengthens that momentum by further investing in proven programmes, including Pathways Pre‑Start and Scottish EDGE, which increase access into entrepreneurship and widen participation.

“One of my top priorities is to listen to and support our entrepreneurs from startup through to scaleup. The Scottish budget allows us to build on this work as we ensure our entrepreneurs have the necessary support to start, scale and stay in Scotland."

A Closer Look at the Scottish Government’s claim on 23 January 2026 that:

“Scotland is one of Europe’s most dynamic start-up economies, outpacing the UK...”

What the evidence does support

Scotland has seen relatively strong startup growth recently

According to the NatWest/Beauhurst New Startup Index, new company incorporations in Scotland grew by about 17.9% in the first half of 2025, one of the strongest rates among UK regions.

That performance put Scotland near the top of UK regional startup growth (second only to the North East).

This means Scotland’s startup ecosystem has momentum, and is growing faster than many other parts of the UK right now — which gives some factual basis to the claim about “outpacing the UK” in this specific period.

There are ecosystem support structures helping founders

Government-backed programmes (e.g., Techscaler with over 1,900 members) and targeted grants/coaching schemes have been expanding.

Some reports note Scotland’s tech and entrepreneurial sectors bucked broader UK declines and recorded net growth in 2024, while many regions saw declines.

So, the policy environment and startup support ecosystem have been actively developing — which is consistent with fostering dynamism.

Where the claim is more tenuous or requires nuance

“One of Europe’s most dynamic” stretches beyond the data

There’s limited independent Europe-wide data directly comparing startup growth rates across EU/EFTA countries that consistently place Scotland among the very top in recent years. The Scottish Government’s press release references Europe-wide growth figures (e.g., a 19% headline figure), but that is likely drawn from internal or *Dealroom-type ecosystem reports embedded in the gov.scot background text rather than widely published EU comparisons with audited metrics.

Independent rankings (e.g., from Dealroom or other ecosystem trackers) typically place major European hubs like Paris, Berlin, Amsterdam, Stockholm, and London ahead of regional ecosystems in Scotland in terms of scale, capital raised and ecosystem breadth.

In other words: Scotland can be dynamic relative to its size, but calling it among Europe’s very top without qualification is not conclusively supported by widely available benchmarked data.

Scale matters

Scotland’s startup population and venture capital ecosystem are smaller than in major European tech centres.

For example, London and Paris attract larger absolute volumes of startup investment and larger companies (e.g., unicorns), while Scotland’s output — though growing — remains relatively modest in scale.

This doesn’t negate growth, but it tempers the idea of being a leading European ecosystem in absolute terms.