‘Particularly concerning’ figures show fall in Scotland’s scale-up business population
“If this downward trend continues, there’s a big risk that it will negatively impact future jobs and economic growth” – Ifty Nasir, founder of Vestd
Scotland’s scale-up business population has declined for three consecutive years, according to new figures that have been described as “particularly concerning”.
The Scaleup Report by tech platform Vestd is based on data from the Office for National Statistics (ONS) and assesses year-on-year changes in the scale-up ecosystem.
The study’s findings suggest that the number of scale-ups in Scotland has dipped by almost 1 per cent in the last year to 8,720 - a continuous downward trend since a previous peak in 2023, Vestd noted.
The decline was reflected across other parts of the UK, with Wales and Northern Ireland both seeing a drop in the number of scale-ups. England was the only nation to experience growth in the last year, although this was minimal at just 0.01 per cent.
North of the Border, Glasgow, Edinburgh and Aberdeen had the highest number of scale-ups. However, Edinburgh saw a 1.38 per cent decrease over the last year, with Aberdeen not having any growth over the past three years. Glasgow bucked the wider trend, with a 1.63 per cent rise in scale-ups in 2025.
The UK’s business population overall continued to grow between 2023 and 2025, rising from 2,726,830 to 2,734,620 last year.
Ifty Nasir, founder and chief executive of Vestd, said: “Our findings on the decline of scale-ups over the last year are particularly concerning, as fewer businesses successfully scaling can translate into fewer employment opportunities, reduced regional investment, and an overall less dynamic entrepreneurial landscape.
“However, businesses can take practical steps to support their next stage of growth, from securing investment to attracting talent and structuring ownership effectively.
“Scale-ups contribute a significant amount to the UK economy, generating a reported £2.19 trillion in the last year. If this downward trend continues, there’s a big risk that it will negatively impact future jobs and economic growth.
“Unless more is done to help ambitious companies grow, the UK’s reputation as a place to build and scale a business will come under increasing pressure.”
Meanwhile, business activity across Scotland fell again in July, according to the latest Royal Bank of Scotland (RBS) growth tracker, as demand conditions remained “challenging”.
The report’s headline business activity index - a seasonally adjusted tracker that measures the month-on-month change in the combined output of Scotland’s manufacturing and service sectors - slipped from 47.6 in June to 47.3 last month. Any reading below 50 denotes contraction.
RBS said there had been some positive developments last month, with inflationary pressures easing, payrolls rising and confidence around the year ahead improving.
Judith Cruickshank, Scotland board chair, RBS, said: “Scottish firms signalled a mixed start to the second half of the year. Activity continued to decline, reflecting subdued demand and a sharp fall in new orders.
“However, business optimism continued to strengthen from April’s recent low. At the same time, firms expanded payrolls, with employment rising at the fastest rate for nearly two years. Inflationary pressures also eased, reducing potential headwinds to demand.
“As we continue into the second half of 2026, we may see this increased hiring translate into increasing business activity if inflation continues to fall.”
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