There was a sharp increase in the number of new tech startups in England, Scotland and Wales last year, according to an analysis carried out by business advisors RSM.
Across the whole of the UK there were 10,000 new tech businesses that set up last year.
Every region of the country recorded year-on-year increases.
A total of 440 software and programming businesses were incorporated in Scotland in 2017, up 77% from the 249 companies incorporated the previous year.
London tops number of new tech startups
The highest number of annual incorporations were recorded in London, at 4,238 (a 76% jump compared to 2016). The South East followed with 1,296 new tech startups (up 40%).
RSM attributed the UK’s tax regime as being a powerful tool in encouraging tech businesses to set up shop in the country as well as the ease in which entrepreneurs are able to have good access to finance.
|Year of incorporation||2016||2017|
|East Midlands (England)||225||337||50|
|East of England||452||660||46|
|North East (England)||97||173||78|
|North West (England)||550||707||29|
|South East (England)||925||1296||40|
|South West (England)||354||503||42|
|West Midlands (England)||272||470||73|
|Yorkshire and the Humber||245||408||67|
UK tech sector vibrant
‘These figures show very clearly that despite the fears of a post-referendum slowdown, the UK tech sector is incredibly vibrant and growing at a remarkable rate.
‘There are a number of reasons for this. The UK’s universities are playing a key role in developing and nurturing exceptional talent. The country – and London particularly – is also continuing to attract the world’s brightest and best.
‘Entrepreneurs are able to gain good access to finance, either through traditional sources of debt at relatively cheap rates, or from venture capitalists and private equity funds.
Venture capitalists are individuals who invest in new ideas, startups, or young companies.
‘The UK’s tax regime is also proving to be an incredibly powerful tool in encouraging tech businesses, who take advantage of legitimate tax saving and incentive programmes. These include the Enterprise Investment Scheme, Research & Development tax credits, video games tax relief and the Patent Box regime.
‘There is undoubtedly the political will to build momentum and generate further growth as part of the government’s overall industrial strategy. However, there are some clouds on the horizon. While many in the sector will be cheered by the news that EU nationals will continue to be able to come and work in the UK during the transition period, the longer term position is as yet unclear.
‘As interest rates starts to rise, we may also see a shift away from venture capital and private equity as investors seek returns from safer investments. For now though, the funding environment is incredibly benign.’
Video – Startup definition
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