The combined value of Glasgow’s ‘Smart Things’ cluster is now worth an estimated £262 million, according to a new report from Glasgow City Council, which claims that the city’s connected tech sector is outpacing Scotland’s technology ecosystem as a whole.

The Smart Things report, the first part of a new Why Glasgow? series from the City Council’s Invest Glasgow arm, shows that the enterprise value of the smart things cluster has risen 3.7x since 2020, when its combined value sat at £69 million, with individual companies seeing a steady rise in valuations.

The photonics and sensing subsectors, in particular, have attracted the most VC investment, along with significant raises for Glasgow-based firms working in robotics, energy, medical devices, and proptech, with the report saying that concentrated investment in key sub-sectors is helping to build momentum while the breadth of emerging tech highlights a ‘strong pipeline of untapped potential’. 

According to the data, smart things firms have increased their headcounts 8x since 2018, reaching almost 1,300 employees this year, a growth rate faster than the wider tech ecosystem, with the Glasgow region being home to eight accelerators, incubators and research centres providing support to the smart things cluster.

The report shows that the city’s IoT and smart tech sector is being powered by the work of the Smart Things Accelerator Centre (STAC), based in Glasgow’s Riverside Innovation District, which, although established just four years ago, already claims to have supported ninety companies in raising £40 million of investment and creating more than 320 jobs.

Among the successes to have emerged from STAC are healthtech NebuFlow, with a value of somewhere between £19m – £28m, and neurotech sensor startup Neuranics, which Dealroom data shows is worth up to £36 million.   

“The energy and the creativeness that we have in Glasgow is first class,” said Paul Wilson, CEO of STAC, in a video accompanying the report’s release.

“The cluster is really starting to take shape. International markets look at Glasgow as a rich source of innovation. There’s momentum building, and there’s a big appetite in the younger generation for entrepreneurship.”

New ventures are a core part of Glasgow’s smart things success, with the data showing that university spinouts account for 20% of companies in the cluster, almost 3x as many spinouts compared to the city region’s tech ecosystem as a whole.

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Healthtech firms, in particular, have proven to be among the cluster’s most valuable contributors, making up 35% of spinouts and accounting for more than half (57%) of VC funding in the Glasgow City Region.

The report found that the combined value of Glasgow-based health companies is a staggering $152 million (£113.5m), 58% of the total enterprise value of the city’s smart things cluster, with the sector benefiting from academic and industry partnerships through initiatives like the Digital Health Validation Lab and new Health Innovation Hub, part of the University of Glasgow.

“Our core four are all PhD students from Glasgow and Strathclyde,” said Scott Black, CEO of medical software firm Seluna.

“We’re collaborating with the University of Glasgow and also NHS Greater Glasgow and Clyde, and then beyond that, loads of grant funding.”