The value of equity investment secured by Scottish businesses was a record £953 million in 2022, up 26% from £754m in 2021, new research reveals.

Economic development agency Scottish Enterprise declared yesterday that its 2022 Risk Capital Market report, based on data from Beauhurst, showed “Scotland’s investment market has retained its position as one of the best performing across the nations and regions of the UK”.

It noted that Scotland had been “surpassed only by the ‘golden triangle’ of London, [and] the south-east and east of England, for both deal numbers and amount raised”.

The number of deals completed in Scotland dipped slightly last year, to 407 from 424 in 2021.

READ MORE: Ian McConnell: This crucial SNP policy is definitely for the good of Scotland

However, Scottish Enterprise observed the value of investment secured had been “bolstered by a number of large deals valued at £50m-plus, which delivered the record investment value in the year”.

It flagged investments of £164m into Borderlink, trading as GoFibre, £50m into Well-Safe Solutions, and £101.3m into TauRx Pharmaceuticals.

The agency highlighted significant investment into university spinouts in Scotland and observed that a growing number of companies were attracting later-stage and international investment, highlighting these as strengths for Scotland.

READ MORE: SNP Prestwick Airport backing pays off, with critics quieter

It said: “Spinouts from Scottish universities continued to attract significant investment with £235 million secured by 58 spinouts, making it a record year for spinout value, up 53% on 2021.”

READ MORE: Denial after denial from brass-necked Tory arch-Brexiter

Scottish Enterprise added: “Participation by venture capitalists is particularly encouraging, again placing Scotland after the golden triangle, and testament to the quality of Scottish companies able to attract this mobile international investment.”

READ MORE: Ian McConnell: Brexit, British nationalism and terrifying times 

Kerry Sharp, director of entrepreneurship and investment at Scottish Enterprise, said: “This latest research shows that Scotland continues to punch above its weight in securing significant investment for its most innovative and ambitious companies.”

Scottish Enterprise noted that “some deal data is ‘undisclosed’ and therefore not included in this research”.

Ms Sharp observed that, in spite of the “positive headline figures”, the risk capital market is “facing some challenges” given economic headwinds.

She said: “We saw investor sentiment impact on market activity in the second half of 2022 and this is likely to continue well into 2023. Many equity investors are focusing on the needs of existing portfolios and they are becoming increasingly selective and are showing signs of changing risk appetites. That, coupled with deals taking on average five months longer, is inevitably making it harder for start-ups and early-stage companies to secure the funding that they need.”

Ms Sharp noted that this year “marks the 20th anniversary of Scottish Enterprise’s co-investment model, which was introduced to act as a catalyst for investment into early-stage, high growth potential companies”.

She added: “Since then, our equity funds have leveraged over £2 billion of private investment into ambitious Scottish companies. It is extremely gratifying to see many of our investee companies go from strength to strength through this investment and also the advice and support that is made available to entrepreneurs and young companies here in Scotland.”