In a promising sign of business optimism, almost every region in the UK saw an increase in the number of new businesses launched in the first quarter of 2025, according to the Barclays Regional Investment Map.

The bank identified a total of 213k new incorporations in their Map, which provides insight into UK company funding and growth. Scotland contributed 10,757 to this total, a 22.7% increase from Q4 2024.

Meanwhile, UK high-growth businesses procured £165bn in bank loans and overdrafts between Q1 2024 and Q1 2025 as financial institutions step up to support businesses, according to the analysis from Barclays Eagle Labs, and private company data source Beauhurst.

While the increase in corporations – typically seen in the first quarter of the year – is slightly lower than the 247k registered in Q1 2024, it reflects a similar growth rate to Q1 2023 (220k) and Q1 (210k), showing that early year optimism maintained against an uncertain economic environment.

Equity Investment Dips

Despite the upsurge in new firms, Q1 2025 saw a falling-off in equity investment activity across the UK, with a -7.27% averag decrease in investment value from Q4 2024 to Q1 2025. However, some regions, including Scotland, bucked this trend.

In the first quarter of 2025, Scotland saw £160m in investment, up by 64.8% from Q4 2024.

Wales, Yorkshire, and Humber also saw increases in the amount of equity funding they saw.

New Businesses

All UK regions saw an increase in the number of new businesses in Q1, with the exception of Northern Ireland, which fell slightly, down -2.07%. The largest percentage increase in new incorporations came in the North East, with 5,230 new ventures registered – a 24.40% rise. This was followed by Scotland (+22.70%), Yorkshire and the Humber (+19.70%) and the North West (+19.20%).

London had the largest increase in total company population, up 4.89% (72k), with the Capital’s 1,545,771 corporations making up 28.40 per cent of all UK firms.

A potential reason for London having the highest company population growth, but not the most new businesses, may be driven by lower closure rates and the continued appeal of the region as a base for registered offices.

With the overall number of registered companies up by 221K since Q4, there are now 5.45m companies registered with Companies House.

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Grant Funding

The majority of UK regions also saw grant funding decline over the quarter, with a 15.40 per cent drop, representing £16.8m less funding across the country than Q4.

Scotland joined this trend, seeing a 63.3% dip in grant funding from the previous quarter, amassing to just £3.27m.

“Q1 often sees a seasonal rise in new businesses opening, fuelled by new year ambitions. Nevertheless, these figures are a positive sign that entrepreneurs continue to have the confidence to take risks and start new ventures in the UK,” Abdul Qureshi, MD, business banking at Barclays, said.

“Whilst our data suggests equity investment and grant funding is declining, Barclays remains open to lending. Through our £22bn Business Prosperity Fund, we can help businesses of all sizes access the finance and expertise to support their prosperity and future growth.”