Investment in Scottish companies doubles in Q2

Scottish companies raised £21 million in the second quarter of 2018 (April – June), two and a half times more than the previous quarter (£8.4 million).

New figures from KPMG’s Venture Pulse report, which highlights key trends, opportunities, and challenges facing the venture capital market, reveals healthcare and biotechnology companies were responsible for £17million of total investment in Scotland.

Standout deals in Scotland included £10 million raised by Edinburgh-based AdoRx Therapeutics, a drug discovery company, and £6 million by 3F Bio, which creates sustainable protein from renewable sources.

The regional trend mirrors the UK story, which also saw healthcare and biotechnology driving some of the top deals, including; Freeline Therapeutics (£90 million), CMR Surgical (£75 million) and Crescendo Biologics at £53 million.

In total, £1.55 billion of Venture Capital was invested in UK businesses across 244 deals in the last three months, with late-stage financings responsible for the majority of capital invested. The UK also accounted for six of the top ten European deals, including Revolut (£188 million) and Freeline Therapeutics (£90 million).

James Kergon, head of transactions services for KPMG in Scotland, said: “Investment in Scotland has bounced back following a hesitant start to the year. As we’ve seen in previous months, the country’s biotech scene continues to attract investors as it is well established, and home to a number of promising start-ups.

“Nevertheless, the number of early stage funding deals is falling across the UK and Europe, as investors continue to focus on later stage investments in businesses with a proven track record. This doesn’t, however, mean backers are avoiding start-ups entirely, as we can see with the multi-million-pound Revolut deal.

“The strength of the Scottish market is encouraging, particularly when you taking into account current economic and political pressures facing businesses domestically, and internationally.”