Miller, who was previously chief technology officer at Innovate UK and has held senior roles at Leonardo and BAE Systems, resigned after what he said was the collapse of a bid to secure the funding, jointly backed by the UK and Scottish Governments.

He criticised the senior leadership team’s “stupid” decision, warning that Scotland is now at risk of falling behind in robotics altogether and will require private capital to fund the future of the sector.

Miller stepped down in April, announcing his resignation publicly, branding the decision as a “significant own goal” as he accused them of undermining all of his “efforts over five years to establish and grow The National Robotarium to the position of respect and prominence it now has in the UK and in Europe.”

He described the decision to abandon the bid as “the final straw in a sequence of events over the past six months” that had made clear the university no longer valued his contribution.

Speaking to The Interest Rate, Miller set out for the first time the scale of what the bid was meant to deliver and how it would have transformed the Scottish economy.

He explained it would have created around 30 jobs in robotics across Scotland and supported roughly 10,000 SMEs and public sector organisations in adopting the technology, with outreach planned in Glasgow, Edinburgh, Aberdeen, the Borders, Orkney and Inverness.

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Miller claimed Heriot-Watt’s leadership wanted the Robotarium’s future built around research rather than the industry outreach and business support the bid depended on.

“It wanted the future of the National Robotarium to be focussed on research, which aligns with its university values,” he said. “However, I wanted it to be a national asset. That’s the way I was thinking about it. It is really bad for the whole of Scotland.

“The original planning for The National Robotarium was to create a global research institute with community outreach, research and business support, but the senior leadership team turned away from the Robotics Adoption Hub project at the last moment.

“It was a stupid decision, as The National Robotarium was making its money from industry outreach and not from the research. It is a shame Heriot-Watt are missing out on the big picture.

“I understand all the pressure on its finances, but we need to be embracing robotics on the global sector and get better organised at supporting it.

“It was a different time when the university applied for the National Robotarium. They had more money and were looking to innovate, but with funding issues it is possible it was no longer of interest.

“The National Robotarium was making money from robotic adoption support for business and support to start-ups – this allowed delivery of community outreach. Research was not contributing to the costs of The National Robotarium in any significant way.”

Miller said the collapse of the bid leaves Scotland exposed at a moment when robotics is moving quickly elsewhere. “The net result is we are being left behind and are underestimating robotics as a whole,” he said. “The sector is moving so fast we will miss out.”

He pointed to the United States, where humanoid robotics is already being used in surgery, as a marker of how far the technology has moved into practical use.

“Robotics needs someone pushing it and it is really important, and it now might rely on the private sector to plan and coordinate its delivery, as it won’t happen at the National Robotarium.

“I worry it will become a research hub and not what it was envisioned to be: a hub that helped train and upskill the SME community and public sector with robotics.

“There is a huge opportunity that it can transform the NHS and help out in education and social care. In the US, robotics has started to be used to help out with surgeries on patients, which helps reduce the cost of treatment and waiting times; in social care it can provide robotic assistance. In education it can be used as classroom assistants. All of this is coming, and AI will push through robotics in the physical form in the coming years.”

Miller said he had sympathy for the Scottish Government’s robotics cluster team, who he said have to compete for funding annually rather than operating under a multi-year mandate. “I feel sorry for the people in the Scottish Government’s cluster team,” he said. “They are doing their best, but it is taking so long, as they have to fight for funding every year.

“There is still a glimmer of light for Scotland. The Scottish Government have a good team who are up against it. Change needs done fast and not piecemeal.

“This isn’t in the national interest. Heriot-Watt didn’t want the responsibility for doing it and going out and training or finding companies. It is too far away of what a traditional university does, which is research, but it was making its money from industrial work.

“Maybe at one time it was in its vision, but the financial issues with universities now might have caused it to steer away.

“I was viewing the job as CEO at the National Robotarium coming from a national lens, to make it the Scottish hub. Heriot-Watt University management didn’t tell me they were not supportive, and I spent two years of my life working on the bid to have it pulled at the last minute, which sparked my resignation.”

It is understood management undertook the “rigorous review” that lasted less than four hours, and a conversation that lasted 20 minutes with Miller.

“The need for Scotland to embrace robotics has not gone away, but the National Robotarium will not grow to be a major driver for the Scottish economy any more, and robotics won’t be a pivotal sector anymore.

“We need to embrace robotics and ensure we don’t catch a cold.”

A Heriot-Watt University spokesperson said: “We categorically reject Mr Miller’s characterisation of the University’s decision not to proceed with this specific funding bid, which was reached following a rigorous review process.

“Funding bids such as this are subject to rigorous review in order to ensure that all proposals are of the highest quality, that they are robust, compliant, strategically aligned and in the best interests of the National Robotarium, the University and our partners.

“The University has appointed two experienced senior leaders to oversee the National Robotarium, and our focus remains on ensuring it continues to be a world-leading centre for robotics and AI innovation, talent development, research commercialisation, and industry collaboration across Scotland and the UK.”

Word reaches this publication that The Interest Rate is now required reading in quarters that would perhaps prefer it wasn’t.

Corridors that shape policy. Offices where decisions about Scotland’s economic future are made.

Rooms where the names of founders and funds are known but rarely spoken about publicly.

One does not wish to be indiscreet, but the readership of this publication has become, how to put this, rather interesting.

You know who you are. And it is important that you inform yourself of the whistleblowing line. This publication does not bite the hand that feeds it.

This update is partly to say thank you, genuinely, for supporting the work of building something more independent, more rigorous, and more honest than what currently passes for business coverage in Scotland.

It is particularly encouraging to see the discourse and debate the coverage is generating on LinkedIn: differing points of view, uncomfortable conversations, the kind of exchange that tends to get avoided elsewhere. That is precisely the aim. It appears to be working.

And partly to flag a few things for the ghosts who enjoy reading without leaving a trace: and there are, it must be said, rather a lot of you in some rather interesting places.

Following conversations with readers who wanted more flexibility in how they support the publication, I have created a Ko-Fi.

It is a test, and a simple one: pay what you want, when you want, no subscription required, full anonymity if you prefer it. You will find it in the latest story.

It is also here if you fancy taking a look or even supporting:

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I am also considering a move to Beehiiv, which has these options built in and allows readers to pay per article rather than subscribing. If you have a view on that, I would genuinely like to hear it.

What this publication is building is not merely journalism. It is a community, one that believes Scotland’s business ecosystem deserves coverage that serves founders, investors and the people doing the actual work, rather than those commissioning the press releases.

That requires readers willing to be part of the journey. Whether that is a contribution through Ko-Fi, a subscription, or simply passing a story to someone who ought to read it: every gesture matters and none goes unnoticed.

This is still early. The foundation is being laid. And those who arrive now are the ones who will have shaped what this becomes.

One does not build something worth reading alone. But then, one suspects you already knew that.

On the subject of what comes next, this publication is planning an event in the summer.

It will not be a panel of the usual suspects saying the usual things in a room that forgets what was said by the time the wine is finished.

The intention is something that generates genuine debate, surfaces uncomfortable truths and leaves with something resembling a solution. Details to follow. If you have thoughts on format, topic or simply want to be in the room, get in touch.

Two areas that have not been forgotten, despite the silence: female-led businesses and the creative economy.

Both deserve sustained coverage and both will get it. If you are a founder, a practitioner or simply someone operating in these spaces who thinks the story is not being told: this publication would like to hear from you.

As ever, your correspondent.

John

Inspirent, which administered the Scottish Government’s Ecosystem Fund and three related programmes, confirmed it is beginning the process of closure just days after announcing the results of its most recent funding round, worth approximately £1.75 million across 44 organisations.

Grant recipients typically receive funding in tranches, invoicing the administrator and claiming money back over the course of a programme.

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The company today confirmed awardees were notified on Friday about the decision to wind down its business.

Inspirent will continue to work with them over the coming months until the end of September to minimum disruptions throughout the transition period.

A spokesperson for Inspirent said: “Our engagement with awardees is already well underway, and we have already been in direct contact with all successful projects. We look forward to working closely with all awardees over the coming months as their projects develop and deliver impact.

“We notified all awardees on Friday that their projects can proceed. A team will remain in place until the end of September and the Scottish Government are working to minimise disruption as they transition to new delivery arrangements.”

It comes after we told how Inspirent shut down its website shortly after notifying successful and unsuccessful applicants of the outcome of the fund, which closed for applications in March 2026 with awardees announced in the final week of May.

In a statement at the time, the board said the decision followed “several years of challenging trading conditions and a fundamental shift in the public sector environment.”

It added: “Despite sustained efforts to adapt and restructure, the Board has concluded that the business is no longer able to operate on a sustainable basis.”

The closure is notable given the company’s financial position. Accounts for Inspirent show approximately £2 million cash in the bank, suggesting the wind-down is a strategic decision rather than one driven by immediate insolvency.

Inspirent was awarded £570,500 excluding VAT to administer the Ecosystem Fund and related programmes. But, the management fee for the work was significantly less than the full contract value, representing around 7% of the fund value.

It was awarded in February 2025 and ran until March 2026 with an option to extend until March 2027.

The organisation had previously suffered a significant blow when it lost the North Lanarkshire Business Gateway contract, which distributed government grants, forcing it to seek more private sector work.

Over its lifetime, Inspirent supported more than 20,000 companies across Scotland, working with businesses ranging from under £100,000 to around £10 million in turnover.

The Scottish Government has not yet commented publicly on how the remaining fund administration will be handled or what protections are in place for awardees who have yet to receive their grants.

Among the organisations awaiting funding are community interest companies, rural development trusts, universities and small charities: some of which will have limited financial reserves to bridge any gap caused by an administrative transition.

The four funds affected are the Ecosystem Fund, the Community (Grassroots) Fund, the Pathways Fund, and the Entrepreneurial Education Fund.

2026 Awardees

Ecosystem Fund

Traveltech Innovation Hub (Edinburgh Futures Institute)

Four hands-on AI “build sprints” helping tourism SMEs adopt AI and improving routes to first customers for traveltech startups.

£29,800

Screen Scotland

Pilot programme matching film/TV producers with business angels, building investable companies and a stronger private finance route into screen.

£40,000

Edinburgh Food & Drink Academy

Curated series of market-facing events and a showcase where founders demo, test and pitch products to buyers, partners and investors.

£39,325

University of Strathclyde

A national discovery platform to surface Scottish HEI spinout/startup opportunities earlier and connect them to angels and VCs.

£40,000

Futurefast Ltd

A maker and micro-manufacturing network with regional meetups and practical workshops (incl. AI productivity) to move makers into trading businesses.

£30,000

MotionLab Ventures Ltd

Cohort programme giving SportsTech startups real-world validation with sports bodies/universities, plus investor-facing showcase preparation.

£39,700

Biome Collective

Facilitated meetups plus mentoring to build commercial skills and peer support for creative producers and early-stage creative entrepreneurs.

£31,000

University of Glasgow (SICSA consortium)

Matches early-stage founders with supervised student software teams to rapidly prototype and test ideas through short delivery projects.

£40,000

SRUC (Scotland’s Rural College)

Five rural entrepreneurship workshops plus follow-on support to help rural founders start, connect to networks and access next-step provision.

£39,500

Adventurous Systems

Regional cohorts helping construction/AEC SMEs use data effectively, with an open toolkit to spread learning beyond participants.

£38,912

STAC & Beyond Ltd

Sourcing and matchmaking that connects life-sciences startups with corporates/research groups to generate pilots and commercial validation.

£40,000

Impact Rise Ventures

10 Scottish tech founders take part in a curated San Francisco immersion to build investor/operator connections and a US growth playbook.

£40,000

Tanis Labs

Virtual exploration support helping deep-tech experts pressure-test venture ideas quickly, then connect the strongest concepts to investors.

£39,875

Scottish Game Developers Association

Annual Games Day conference convening studios, investors and talent to strengthen networks, visibility and business growth in games.

£40,000

Sabhal Mòr Ostaig

Bilingual Gaelic/English pathway combining ideation sessions, a gathering and a short accelerator to help Gaelic founders start and grow.

£39,968

James Hutton Limited

Supports climate-tech founders to become investor-ready and visible via an online “venture exchange” and targeted investor engagement.

£39,900

Ecosystem Builders

Cohort programme preparing Scottish pre-seed startups for investment through founder support, investor readiness training and investor access.

£40,000

GlasHub

Talent-matching programme connecting Glasgow startups with university students and graduates to create placements and widen access to entrepreneurship.

£15,000

Ecosystem Fund Total (this round): £662,980

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Pathways Fund

COLLECTIVE COMMUNITIES CIC

Place-based enterprise support programme helping underrepresented founders build confidence, test ideas and access low-risk trading opportunities through peer learning and shared workspace.

£74,108.88

GrowBiz Scotland

Rural microfinance support programme helping women entrepreneurs access small-scale finance, mentoring and peer support to start or grow businesses.

£36,402.50

Aberdeenshire council - Business Gateway Aberdeen City & Shire (BG ACS)

Female founder support programme providing coaching, peer networking and specialist business support to help women start and grow businesses.

£73,984.86

Empower Women for Change (EWfC)

Community-led enterprise incubator helping ethnic minority women and girls build entrepreneurial skills, develop business ideas and access mentoring and peer support.

£50,485.00

Robert Gordon University

Blended startup programme helping people aged 50+ build entrepreneurial confidence, test business ideas and explore self-employment through tailored enterprise learning.

£31,582.22

Digital Health and Care Innovation Centre (University of Strathclyde)

Inclusive innovation programme helping women and migrant health and care workers develop entrepreneurial skills, test ideas and access innovation support pathways.

£69,483.68

Dundee City Council

Regional enterprise programme helping women returning to work build confidence, explore self-employment and connect with peer and business support networks.

£74,999.00

Highland Well-Ness Collective

Pilot programme combining counselling, ADHD coaching, neurodivergent-informed business support and peer/body doubling sessions to help neurodivergent founders and freelancers sustain self-employment.

£28,870.00

Digital Boost Upskilling

Dedicated mentoring and peer support programme for disabled entrepreneurs, combining lived-experience mentoring, mentor training, peer learning cohorts and monthly networking.

£69,500.00

Community Fund Total (this round): £509,416.44

Ecosystem Community Fund (Grassroots)

Royal Conservatoire of Scotland

Workshops + meetups building a Scotland-wide peer network for creative practitioners using digital/AI tools to develop commercially viable work.

£9,999

The Stove Network

Cohort support and practical workshops helping rural creative entrepreneurs develop and test “IRL” experience-economy venture ideas into MVPs.

£8,640

Eat South CIC

Sector-specific Jumpstart programme for new food/drink businesses covering product, compliance, branding, pricing and pitching with 1:1 support.

£9,900

Edinburgh Social Enterprise Network

Five peer-led networking/learning events helping social enterprises build CSR partnerships, plus a live service directory to drive market access.

£9,700

Prosper

Practical Agentic AI literacy workshops (Aberdeen, Inverness, online) with follow-up drop-ins to help rural entrepreneurs adopt AI safely and effectively.

£8,382

Dunoon Community Development Trust

Co-creates enterprise-themed events with 30 local women to test ideas, build confidence and connect into local support across tourism/creative/food themes.

£9,999

Black and Scot

Three-city programme launching Scotland’s Black Tech conference and peer mentoring network to increase visibility, connections and progression for Black talent.

£9,999

Tempo Community CIC

In-person TikTok/content creation workshops plus drop-ins helping young people build digital skills and explore low-cost routes into earning/self-employment.

£5,295

ESF

One-day hands-on leadership lab for pre-scaling SME leaders to work through common scaling barriers via expert input and facilitated peer tables.

£9,999

Edinburgh Napier University

Builds shared SportsTech ecosystem infrastructure: coordination/signposting platform, playbooks and an online national events calendar to connect actors.

£9,900

Pathways Fund Total (this round): £91,813

Entrepreneurial Education Fund

Daydream Believers Education Ltd

Development of a new SCQF Level 7 qualification helping young people build creative thinking, innovation and entrepreneurial skills through real-world challenges.

£143,131.12

Volunteering Matters

School-based social action workshops and hackathons helping disadvantaged young people build entrepreneurial skills, confidence and leadership through learner-led community projects.

£30,181.22

Venture Trust

Outdoor experiential training helping teachers and youth workers build young people’s entrepreneurial mindset, resilience and meta-skills through practical learning approaches.

£19,462.00

Social Enterprise Academy

Online social entrepreneurship programme helping secondary school non-attenders build entrepreneurial confidence, enterprise skills and positive pathways through team-based business challenges.

£56,540.00

Borders College

Regional enterprise challenge programme helping Senior Phase pupils develop entrepreneurial skills, sustainability awareness and industry connections through team-based innovation projects.

£36,134.16

Powering Futures

SCQF Level 6 challenge-based programme helping young people develop entrepreneurial skills, industry connections and workplace readiness through real-world business challenges.

£150,000.00

Artlink Edinburgh and Lothians

Studio-based film and animation programme helping young people with additional support needs develop entrepreneurial and creative industry skills through real-world production projects.

£41,790.00

Entrepreneurial Education Fund Total (this round): £477,238.50

There is an old rule in boardroom politics: if you want to neutralise your most dangerous rival, do not fire him. Hand him the brief most exposed to failure, put him under the brightest spotlight, and let the data do the rest.

John Swinney won an election nobody was certain he would win. His party returned its worst result since 2007 on his watch. He has a mandate and a target on his back simultaneously: the kind of arithmetic that focuses a leader’s mind on moving quickly before the political weather changes. He is moving.

Stephen Flynn has been handed the economy, transport and tourism brief and full public accountability for GVA growth that has averaged around 0.3% annually for the better part of a decade.

Ivan McKee, Cabinet Secretary for Public Service Reform, has been handed the agencies, the contracts, the measurement frameworks, and the scalpel.

Flynn will face the cameras. McKee will remake the machine.

A formal letter has been sent directing 50% budget reductions across the civil service. That is fiscal reality, austerity driven by a £1.4 billion structural gap that has closed every option except the one nobody wanted to use.

Separate from that, the enterprise agencies face their own reckoning. Scottish Enterprise, Highlands and Islands Enterprise, South of Scotland Enterprise, Skills Development Scotland: mergers, elimination of duplicate functions, the stripping out of overlapping layers that have sustained the same broken model across fifteen years and multiple programme cycles.

Austerity is what the fiscal position demands. Reform is what McKee intends to do inside it. They are not the same project. One shrinks the system. The other is meant to replace it.

McKee has complained about civil servants have been obstructing ministerial intent. That is no longer corridor gossip.

It is stated policy reality, and the formal letter is the answer to it translated into numbers. The civil service that spent years managing reform mandates into something the system could survive has been told that the resource it relied on to sustain that process is being cut in half.

The £1.4 billion gap has closed the traditional escape hatch: redirect ministerial energy toward new spending, a fresh framework, a hypothecated fund with a steering committee and a theory of change. That option no longer exists.

Swinney launched his leadership campaign from a social enterprise. Not a boardroom, not a party headquarters: a social enterprise, ground level, small money.

He was sceptical of the gleaming hub model long before the evaluators confirmed what the scepticism suspected. He said, repeatedly, that he never had the political mandate to act on what he believed.

The election changed that. The question now is whether the mandate outlasts the pressures already gathering around it.

The machine that ate the money

Scotland’s economic development system did not fail by accident. It was designed, with considerable consistency across years and multiple programme cycles, to optimise for activity rather than outcomes.

Launches. Announcements. Stakeholder events attended, reports submitted, evaluations commissioned, steering committees minuted.

Against every one of those metrics the system performed admirably. The GVA data is what it produced while performing.

Pre-2007, annual GVA growth averaged roughly 1.8%. By 2016–19 it had settled at 0.3%. The manufacturing sector contracted for six consecutive quarters through 2023 and into 2024, falling as far as -4.8% year on year.

Business services and finance contracted. Government and public services, funded entirely by the tax receipts generated by the sectors contracting around them, grew at a steady 2.6% to 3.1% throughout.

Scotland was borrowing economic activity from its own future and recording the interest payments as growth.

Inside the Scottish Government’s economic directorate, sources describe not a unified broken system but a split institution.

One faction, dominant, well-resourced, with deep roots in the agency landscape, spent years obsessed with high-growth sectors: technology, life sciences, the infrastructure of innovation.

Another argued for broader support grounded in employment impact rather than sector glamour.

The argument was never resolved because it could not be resolved. Scotland never built the local data infrastructure needed to settle it.

Granular, reliable, timely data on what was actually happening to businesses across the economy, not the aggregated national figures but the street-level commercial picture, was never systematically collected.

So the high-growth faction won by default, because it had the frameworks, the agency relationships, the programme architecture, and the ministerial announcements. The broader view had the instinct and not much else.

David Storey’s analysis cuts through the resulting confusion with uncomfortable precision: businesses generating significant employment are worth backing regardless of sector.

The obsession with high-growth outliers, the unicorn hunt, the tech hub, the innovation launchpad, ignores the commercial mass that actually sustains an economy and the tax base that funds everything else.

Swinney’s instincts align with it. The question is whether instinct backed by mandate is enough to redirect a system that has been selecting against this view for nineteen years.

The public sector crowding-out problem sits underneath all of this and rarely gets the attention it deserves.

Enterprise agency programmes consuming resource that would otherwise have flowed to commercial and community initiatives.

The infrastructure of support displacing the activity it was funded to generate. Scotland’s public sector became the most reliable engine of recorded GVA growth during its own stagnation, the sector funded by taxation outperforming the sectors that generate it.

That is not a statistical quirk. It is what happens when the support apparatus grows faster than the economy it is supposed to be supporting, and nobody in the system has an institutional interest in noticing.

The evaluation that changed nothing

The EKOS early evaluation of Techscaler is the most efficiently damning document in recent Scottish economic policy, which given the competition is a considerable achievement.

Kate Forbes flagship programme run by Codebase directed 63% of assessed expenditure, around £13 million in the programme’s first years of a £42 million total to staff costs.

Not to founders. Not to capital connections, experienced operators, or market access. To staff. The evaluators found no definition of success against which the spending could be judged.

That is not an oversight. It is the design philosophy of a system that has learned, across many budget cycles, that defining success creates the possibility of measurable failure and that measurable failure is the one outcome the system is most comprehensively structured to prevent.

So it stopped defining success. The evaluation then found nothing to measure. The recommendation was further resource and a revised theory of change. The programme continued. The invoice accumulated.

Another Forbes initiative saw £17.5 million committed to closing the gender gap in Scottish entrepreneurship but finished at the bottom of the UK rankings it was funded to improve behind Wales, behind Yorkshire.

No programme lost funding. No director lost their position. The evaluation industry that documented the failures was commissioned to assess the next round. Its recommendation was further resource and a revised theory of change.

It is worth sitting with that for a moment. The people paid to assess whether the system was working concluded, with institutional regularity, that the system needed more money.

Nobody in a position of authority found this arrangement sufficiently remarkable to change it. The £1.4 billion gap is what that arrangement costs when the bill finally arrives.

Round One, built by Alex Rowe and Bruce Walker with less than £50,000 from the ecosystem fund, created an investment readiness programme for pre-seed companies.

In its first year, participants sought investment and secured it. Less than £50,000 against £42 million is not a marginal efficiency difference. It is a description of what the system spent nineteen years failing to notice because it was measuring whether the hub was open, not whether founders got funded.

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You have seen the mechanism. You know the attribution rate. You know what happened to the Pathways report.

You know what Scotland gets from its Netflix partnerships and what Netflix gets from Scotland.

The verdict does not require repetition of the case.

It requires an honest account of what the case adds up to, why the pattern persists, and what it would actually take to change it.

The pattern is the policy

The nursery economy was not an accident.

It was not the unintended consequence of well-designed policies that failed at implementation.

It is the revealed preference of an administration that has, in full possession of the evidence that its model was not working, chosen to expand the model rather than reform it.

That choice has been made repeatedly and specifically. The EKOS evaluation existed before the manifesto committed to expanding Techscaler across six new sectors.

The Pathways report existed before the Journey Fund was announced. The High Growth Spinout programme demonstrably works and the manifesto proposes a new unit that may displace it.

The ScotWind pricing decision was made by people who understood the asset they were pricing. In each case the evidence pointed toward structural reform and the response was institutional expansion.

That is not a coincidence. It is a pattern of decision-making that reflects a consistent set of priorities.

Understanding why requires honesty about the political incentive structure that produces it.

A new accelerator with a technology company partner generates a launch event. A rigorous evaluation followed by a decision to wind down a programme that achieved a 13% attribution rate generates a political liability.

A £200 culture pass produces sympathetic coverage before an election. An IP framework does not. A minimum income for artists is announceable.

An export finance vehicle is not. The grant cycle is not a policy failure in the conventional sense.

It is a rational response to incentives that systematically reward what is visible and immediate over what is productive and structural.

Democratic politics produces this tendency everywhere. Scotland has had nineteen years to correct it and has not.

Adam Smith's framework remains the clearest diagnostic tool available. Three conditions for productive wealth that compounds rather than dissipates: specialisation must be rewarded rather than subsidised into survival, the market for that specialisation must be frictionless rather than managed, and the returns must be retained and reinvested by those who generated them.

Scotland has the first condition in abundance. It has not built the second or third. The grant cycle subsidises the first. It substitutes for the other two. After nineteen years that is not an implementation gap. It is a choice about what kind of economy Scotland intends to be.

The analysis that follows is for paid subscribers. It covers the constitutional reckoning, the fiscal audit, and the three specific accountability mechanisms that would change the institutional logic rather than simply restate the aspiration. If the first two pieces in this series convinced you the problem is structural, this is the part that explains what structural reform actually requires and why the manifesto cannot deliver it.

If you are not yet a subscriber, this is the moment. The Interest Rate exists because this kind of journalism does not get commissioned elsewhere. It gets supported here.

The constitutional question Scotland needs to answer honestly

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A creative sector with global recognition in festivals, screen, games, music, and design. The question in both cases is not whether the assets exist. It is why policy consistently fails to capture their value.

The female founder pipeline

Scotland committed £17.5 million to dedicated female entrepreneurship initiatives in the previous parliament. The Gender Index 2026 places Scotland at the bottom of the home nations for high-growth female-led companies.

Female-led companies are dissolving faster than they are being incorporated in some cohorts.

The youngest founder demographic is 73% male. Three years of awareness campaigns, practitioner guides, speaker audits, and voluntary pledges did not move the numbers that matter. The manifesto does not ask why.

It offers a grant. The Journey Fund promises up to £50,000 for women, minority-ethnic, and disadvantaged founders who make it past the Concept Fund stage.

This is the nursery economy applied to a different pipeline. Scotland funds early-stage activity.

Those founders then encounter an ecosystem the data shows is structurally hostile to progression: an angel investor gap where formal investment runs at half the rate of informal networks, a sectoral bias that concentrates capital where female founders are underrepresented, and a scaling cliff where the pipeline collapses most sharply at the point companies need institutional risk capital rather than grant support.

Beyond the financial barriers is the cultural environment the data reflects but the manifesto does not name.

Across accelerators, investor networks, and publicly funded programmes there are persistent and well documented reports of sexual harassment, bullying, misconduct, and exclusionary behaviour directed at female founders and ethnic minorities. These are not isolated incidents.

They describe a pattern reported, reviewed, and in some cases formally investigated across multiple parts of the ecosystem over an extended period.

Women who encounter these conditions do not simply endure them. Many downscale their ambitions, exit programmes early, relocate elsewhere, or leave Scottish entrepreneurship entirely.

They take with them their companies, their networks, their future angel investment capacity, and the mentorship they would have provided to the next cohort.

The ecosystem loses compounding value at every stage of that exit. That exit is sustained by a structural silence.

Founders dependent on publicly funded programmes for access to capital, networks, and visibility face a rational calculation about whether reporting misconduct is worth the professional risk.

Where gatekeepers control access to the next funding round, the next cohort, or the next investor introduction, speaking out carries costs that staying silent does not. That is not a failure of individual courage.

It is a power imbalance that public funding created and public accountability has not corrected. Where misconduct has been reported, the response has in some cases compounded the problem.

Investigations within publicly supported programmes have in some cases been managed with the reputation of the ecosystem as the primary consideration rather than the welfare of the person who reported.

Findings are contained. Conclusions are qualified. The individual who came forward absorbs the professional consequences while the institution that failed them continues to receive public funding.

The message that sends to every other founder watching is not ambiguous. Reporting is professionally dangerous. Silence is rational.

The pipeline leaks not only because the conditions are hostile but because the mechanisms that should correct those conditions have in some cases been captured by the institutions they exist to oversee.

The Pathways report named these dynamics clearly and called for compulsory data reporting, mandatory transparency on investment decisions, independent oversight of complaint handling, and structural intervention beyond voluntary pledges. It was read.

The ecosystem continued largely as before. Three years later the manifesto's response is a grant for those who survived the pipeline the report said needed fixing. Grants for survivors are not a remedy for the conditions that produce attrition.

They are compensation for those resilient enough to endure conditions that should not exist in publicly funded ecosystems. They also reduce the institutional pressure to fix those conditions. If the consequences can be partially offset by money, the incentive to address the environment itself weakens.

A credible strategy would mandate disaggregated reporting on all publicly supported investment decisions, require a fully independent review of safeguarding and cultural practices, create protected routes for reporting misconduct without career risk, and make public funding conditional on professional standards rather than voluntary pledges.

The manifesto chose the grant instead. The pipeline will continue to leak. Another programme will be announced.

The creative economy

Scotland’s creative sector has global recognition it has built largely without the commercial infrastructure to retain the value that recognition generates. The talent is real.

Production activity has grown: Screen Scotland reports rising GVA and employment, with major Netflix and Amazon commissions bringing filming and spend.

What is consistently missing is the framework that turns that talent into retained, compounding economic value in Scotland.

Adam Smith’s foundational insight was not about markets in the abstract. It was about the specific conditions that allow productive specialisation to generate wealth that compounds rather than dissipates.

Three conditions matter: the division of labour must be allowed to deepen, meaning specialisation should be encouraged and rewarded rather than subsidised into survival.

The market for that specialisation must be as large and as frictionless as possible, meaning barriers between production and commercial scale must be reduced rather than managed.

And the returns from that specialisation must be retained and reinvested by those who generated them, meaning ownership structures, IP frameworks, and financial infrastructure must be designed to keep value with creators rather than transferring it to intermediaries and aggregators.

Scotland has the first condition. Its creative specialisation is genuine, deep, and internationally recognised across festivals, screen, games, music, and design. Major streamers are filming here. It has consistently failed to build the second and third.

The market for Scottish creative work remains fragmented, undercapitalised at the commercial scaling stage, and structurally dependent on platforms and aggregators whose ownership models are designed to extract rather than return value to creators.

Too often the returns travel: to London, to Los Angeles, or to the streaming platforms whose catalogues are built on content produced in places that have not built the infrastructure to retain what they create.

George Osborne when he was Chancellor identified the creative industries as one of the UK’s strongest growth sectors and the commercial infrastructure that underpins the most successful creative economies, IP frameworks, export finance, co-production vehicles, and private investment channels, has been visible in comparable jurisdictions for decades.

Canada built it deliberately through the Canadian Media Fund and its co-production treaty network.

Ireland built it through Screen Ireland, the Section 481 tax incentive structure, and export-oriented IP frameworks that allow Irish creative businesses to retain equity in their own work across markets.

New Zealand built it through the New Zealand Film Commission and a deliberate strategy of turning Lord of the Rings from a production event into a permanent infrastructure asset.

Each of these countries identified the same gap Scotland has and chose to close it through commercial infrastructure rather than consumption subsidy.

Scotland has chosen differently. The gap is specific and buildable: IP ownership frameworks that keep value in Scotland when creative work reaches commercial scale, co-production finance vehicles that reduce dependence on external platform money, and international sales infrastructure that gives Scottish creative businesses the capacity to reach markets without licensing their value away to reach them.

Scotland does not have these mechanisms. The manifesto does not propose to build them.

Instead it offers £100 million in additional annual culture funding, a Scottish Artists Minimum Income, a £200 Youth Culture Pass, a new Film and TV school, and several institutional expansions.

The minimum income provides a floor for creative practice and that floor has legitimate value.

But the Irish model the manifesto cites as its inspiration exists alongside the commercial ceiling that allows Irish creative businesses to grow beyond sustained practice into scaled, revenue-generating enterprises that retain their value in Ireland.

The manifesto has the floor. The ceiling is not mentioned. Without it the minimum income sustains creative activity without building the commercial conditions that would make that activity economically self-sustaining over time.

It is, in Smith’s terms, a subsidy to the first condition without any serious investment in the second or third.

The Film and TV school is the most revealing commitment in the section. Scotland already has Screen Scotland.

It already has production infrastructure, trained crews, established locations, and a demonstrated capacity to attract international productions.

What it lacks is the commercial ecosystem that turns production capacity into retained export revenue.

The school will train more people to enter a sector whose commercial conditions will cause many of them to leave Scotland to build their careers.

Scotland produces the graduates. Ecosystems with the infrastructure employ them. The creative economy version of the nursery economy, producing the same outcome in a different sector through a different mechanism but with identical structural logic.

The Netflix and Amazon partnerships complete the picture with a clarity the manifesto does not appear to recognise as damaging.

These are companies whose entire business model depends on acquiring content rights globally while retaining platform value domestically. Scotland provides the locations, the crews, the cultural backdrop, and in some cases public subsidy through tax incentives and tourism infrastructure.

Netflix and Amazon acquire the IP, retain the subscription revenue, and build catalogues with Scottish-produced content that compounds value for their shareholders rather than for the Scottish creative economy.

The production spend circulates locally and the tourism footfall is real. But in Smith’s framework this is an arrangement that systematically transfers the returns from Scottish creative specialisation to external intermediaries. Scotland is not building a creative economy through these partnerships.

It is providing subsidised inputs to platforms whose commercial model is precisely designed to prevent the retention and reinvestment of creative value in the jurisdictions that generate it.

The £200 Youth Culture Pass will be spent. Some of it will reach Scottish artists. Most will reach whoever has the best distribution infrastructure, which is not by definition the emerging Scottish creative businesses the policy claims to support.

As a consumption stimulus it has a certain logic. As an economic growth policy for the creative sector it has none.

It increases demand for creative consumption without building the supply-side conditions that would allow Scottish creative businesses to capture and retain the value of meeting that demand at scale.

Taken together the manifesto’s creative economy offer is a comprehensive programme for sustaining creative activity in Scotland while exporting the economic value of that activity to the platforms, intermediaries, and ecosystems that have built what Scotland has not.

It is the opposite of what Smith described. The specialisation is encouraged. The market friction is managed rather than reduced. The returns are transferred rather than retained. And the policy response is to fund more specialisation and call the result a strategy.

What Both Sections Share

The female founder pipeline and the creative economy are different domains with the same policy response: identify the symptom, fund the visible end of the pipeline, announce progress, and move on.

A serious approach would fix the structural conditions that drive leakage: transparency, accountability, commercial infrastructure, and retention mechanisms.

The manifesto chooses grants and schools instead. It subsidises the early stage and exports the scaling value.

The nursery pattern is consistent. The grant cycle continues. After nineteen years the manifesto still treats symptoms and calls it strategy.

The final piece delivers the verdict across nineteen years: what the model has produced in aggregate, what a genuinely different approach would require, and why the 2026 manifesto represents not a failure of ambition but a failure of honesty about what ambition requires.

The SNP has governed Scotland for nineteen years. It has produced more strategies, reviews, enterprise programmes, and chief entrepreneurs than any other devolved administration in the UK.

It has also presided over an economy that consistently fails to meet its own targets, a flagship tech programme that cannot prove it works, and a female entrepreneurship effort that has made measurable outcomes worse.

The 2026 manifesto does not mark a change in direction. It doubles down on the same model, only larger.That model has a structural flaw the manifesto refuses to name. Scotland has built a nursery economy.

Public money flows into early-stage company creation: accelerators, pre-start centres, skills schemes, challenge funds. When those companies reach the scaling stage and need serious capital and commercial infrastructure, many leave for London, Dublin, or Amsterdam. Scotland pays the cost of development.

Other economies collect the tax base, the high-value jobs, and the reinvestment cycle. A founding team does not stay behind like a motorway. It leaves with the company, taking its networks, its institutional knowledge, its future investment capacity, and its mentorship.

The nursery grows the best plants only to watch them get transplanted at the moment they become most valuable.

The manifesto’s answer is to build a bigger nursery.

Techscaler: The manifesto describes Techscaler as one of Europe’s most sophisticated state-backed start-up institutions and commits to expanding it into six new sectoral powerhouses: games and immersive arts, creative industries, food and drink, energy transition, advanced manufacturing, and space technology.

The Financial Times ranks it 176th. The independent EKOS evaluation found no success metrics at the outset, a theory of change written after the money was spent, staff costs at 63% of expenditure, and a 13% attribution rate.

Most founders said they would have progressed without it. That is not a rounding error. It is the central test for any publicly funded programme and Techscaler failed it.

After £42 million and two years of independent evaluation, the programme cannot demonstrate it creates economic value that would not have existed anyway.

In any commercially rigorous environment that finding ends a programme. In Scotland's grant-dependent ecosystem it triggers an expansion bid.

That figure is not a technical imperfection. It is the central test for any publicly funded programme: is it creating new economic value, or simply subsidising activity that would have happened anyway?

A programme that cannot demonstrate additionality after £42 million and two years of evaluation has not earned expansion. It has earned reform or wind-down. The six sectors earmarked for expansion are not fresh territory. They are Scottish Enterprise’s existing remit.

Scottish Enterprise already employs sector specialists across food and drink, energy, advanced manufacturing, and creative industries and it is simultaneously cutting jobs as with other enterprise quangos.

The manifesto is building parallel infrastructure inside a low-additionality programme while hollowing out the agency that already holds the expertise.

It offers no explanation for why duplication is preferable to investment in what exists.

The AI Strategy and the CoreWeave Deal

Scotland has genuine AI assets: strong university research at Edinburgh, Strathclyde, and Heriot-Watt, and access to public sector data that could anchor applied AI development.

The manifesto’s flagship AI commitment is a new accelerator delivered with US hyperscaler CoreWeave and Codebase. CoreWeave is deepening its Scottish presence with a £1.5 billion investment in green AI infrastructure and a partnership offering GPU access, technical sessions, and events for Scottish AI founders and scale-ups.

Access to serious compute is a genuine bottleneck. But the arrangement raises questions the manifesto has not asked.

Who owns the IP generated on CoreWeave infrastructure? What additionality does the public contribution provide beyond what Codebase and CoreWeave would offer commercially?

Scotland now has at least three overlapping accelerator propositions in the same ecosystem with no clear accountability.

The structural risk is direct. Scotland subsidises access to American compute infrastructure so that Scottish founders can build early-stage AI companies that American capital is then well positioned to acquire or relocate at scale.

Scotland gets the training costs.

The returns travel. In a sector where the gap between early promise and acquisition can be measured in months, subsidising infrastructure owned by the likely acquirers accelerates the very leakage the nursery economy already produces.

CoreWeave is not a neutral compute provider. Its strategic interests are not identical to Scotland’s.

Scotland is not building an AI economy. It is subsidising the early stages of one that American capital is better positioned to capture than Scotland is to retain. The manifesto presents this as strategy. It is the nursery economy with a GPU attached.

Fiscal reality

The Institute for Fiscal Studies estimates the manifesto adds roughly £1.4 billion in new annual spending by 2031-32.

The funding rests on efficiency savings that have not materialised and growth assumptions the Scottish Fiscal Commission views as optimistic. The gap between ambition and fiscal capacity closes eventually: usually through higher taxes or lower services.

The Small Business Bonus and income tax stability are positive signals. But the Mansion Tax, Private Jet Tax, and non-domestic rate reforms send a cumulative message that compounds across investment cycles.

The cumulative signal is a jurisdiction that taxes success more readily than it rewards it.

That perception compounds across investment cycles in ways that are difficult to reverse and that no individual measure undoes.

Coordination and the programme that actually works

The manifesto creates a new High Growth Unit while Scottish Enterprise cuts jobs. Scottish Enterprise already runs a High Growth Spinout programme with demonstrated results: measurable additionality and companies that scaled and remained in Scotland.

The new High Growth Unit may sit alongside it, absorb it, or crowd it out. The manifesto does not say.

It has not considered the question. An administration that spent three years defending a 13% attribution rate is creating a new unit that risks displacing the one programme in the ecosystem that demonstrably works.

That is not an oversight. It is a pattern.

ScotWind and the Just Transition

The 2022 ScotWind leasing round raised £755 million. A rigorous commercial process would have generated considerably more.

No ScotWind projects secured contracts for difference support in the latest UK auction round.

Portions of the revenue supported day-to-day spending rather than the long-term wealth fund the manifesto continues to promise.

Grangemouth is the Just Transition in miniature: years of announcements, a workforce still waiting. In nineteen years the gap between announcement and delivery has not narrowed. It has become the signature.

The Grant Cycle

The original ambition for Techscaler was not a nursery. The STER report set out to build a scale-up superhub capable of keeping ambitious companies in Scotland through the growth stages.

That ambition was not delivered. What emerged instead was a grant-dependent ecosystem that sustains itself by attracting the next funding cycle rather than producing scale-up outcomes.

When additionality is not rigorously measured, the behaviour the grants reward continues to recur.

The response to the EKOS evaluation was not reform. It was repackaging.Scotland set out to build a scale-up superhub. It built a grant-dependent nursery. The best companies left at the point they were supposed to stay.

Every million spent on a 13%-attribution-rate accelerator is a million not spent on the tax incentives or growth equity that might actually keep those transplanted plants in Scottish soil.

The public money that grew them became a subsidy to the economies that captured them. A welfare economy requires a growing productive base. Scotland does not have one that is keeping pace with its spending ambitions.

The 2026 manifesto is the next iteration of the same response: more early-stage support, more consumption measures, more coordination bodies, more grants. The nursery is expanding.

The best plants continue to leave. After nineteen years, the manifesto still has no serious answer for why that will change.

The nursery economy pattern runs through the entire manifesto. The next piece examines where it is most visible: a female founder pipeline leaking at the scaling stage while the manifesto hands grants to survivors at the top, and a creative economy offered a school when what it needs is a market.

Scotland chose to invest £17.5 million in a programme to grow female entrepreneurship. Its response was to commission another report confirming the same problems the UK Government’s 2019 Rose Review had already spelled out for devolved administrations.

Scotland then went ahead and launched a voluntary pledge, published a nine-page guide advising programme managers to stop saying “guys,” and called it a programme.

The Gender Index 2026 has just published its findings. Scotland is bottom of the home nations for high-growth female-led companies.

The comparisons that matter most are not with London or Manchester, where different economies, different scales, and different concentrations of financial services make direct comparison easy to dispute. They are in Yorkshire and Wales.

Read more

It has come to this author’s attention that The Interest Rate has become something of a toilet read in certain offices around Edinburgh.

The kind you don’t leave on your desk. One hears it is particularly enjoyed in the corridors of Holyrood, in the discreet rooms of investor firms, and across other select quarters of the Scottish business scene.

There is, after all, no other publication in Scotland quite so bold in its scrutiny.While our investigations into public spending continue, I want to add three areas that deserve proper coverage and are not getting it:

• Female-led businesses doing brilliant work that rarely gets the spotlight it deserves.

• The creative sector, which is a quiet boom if treated well.

• And entrepreneurship: the real thing, not the pledge version.

If you are a female founder doing brilliant work that is not getting the attention it deserves, I want to hear from you. That is exactly what this strand is for. The gap in coverage is the story, not you.

With Scottish elections coming, we will also be looking at what the parties are actually promising on these issues and what those promises mean in practice. Scottish Labour appears to be the only party that genuinely understands the economic role the creative sector can play.

Ironically, George Osborne saw it too. The Scottish Conservatives did not think it worth a mention in their manifesto.

If you are reading this, you already get it. While much of Scotland talks about the economy, few are saying what is actually happening behind closed doors. A reader subscription is £50 a year for the full analysis.

A free version will remain available, offering a summary of the analysis and key findings.

It will give readers the shape of the story, while the full context and deeper reporting remain for paying members. The coverage will also be broken into shorter, more magazine-style sections.

For founders, investors and ecosystem leaders who want more than the reporting itself, the Founding 50 offers a closer relationship with the newsroom, a journalist-written profile, and a place in a serious Scottish business community.

Full details: https://theinterestrate.substack.com/p/join-the-interest-rate-scotlands

It contained thirty-one recommendations, an explicit warning that voluntary pledges had never worked and would not work this time either, and a precise description of the measurement infrastructure without which nothing else could be evaluated.

Then they launched a voluntary pledge. The measurement infrastructure was not built.

The report was called *Pathways: A New Approach for Women in Entrepreneurship*. The headline numbers were stark. Women make up more than half of Scotland's population.

They represent one in five entrepreneurs. They receive 2% of institutional investment: a figure that, by the report's own data, had already worsened to 1.5p in every £1 by the time Pathways launched.

The 2019 Rose Review estimated that closing the gender gap in entrepreneurship could add £250 billion to the UK economy.

The Women and Equalities Committee put that figure at £310 billion in its October 2025 report: the most comprehensive parliamentary inquiry into female entrepreneurship in a generation. Its conclusion, after reviewing six years of evidence: voluntary initiatives have failed.

The 2% VC investment share that was already a crisis figure in 2019 had fallen further by 2024, to 1.9%, down from 2.5% the year before. Six years of voluntary codes, awareness campaigns, and warm words from people who chair things. The share went backwards

The WEC called for a dedicated Female Entrepreneurship Strategy, mandatory FCA gender reporting with penalties, and British Business Bank targets to increase equity for female founders from 2% to 10% by 2030. The government responded in January 2026.

It welcomed the ambition, pointed to a £635 million Invest in Women funding pool, and confirmed it did not rule out future intervention if voluntary measures continued to fail. No new strategy. No dedicated minister. No mandatory targets. No penalties.

This is the UK-wide context that Scotland's Pathways programme, launched in 2023, two years before that parliamentary verdict, was supposed to make unnecessary.

The budget that answered the economic case

The Scottish Government committed £17.5 million to address the structural underrepresentation of women in entrepreneurship. To understand what that figure represents, it helps to compare it to something.

Months earlier, the Scottish Government awarded a single contract for Techscaler: its flagship tech programme, worth £42 million at base value and £59.2 million including extensions.

That is a programme whose own independent evaluation found no success definition, a retrospective theory of change, and 63% of spending absorbed by staff costs with no granular breakdown provided to evaluators. A programme whose founders reported a 13% attribution rate: fewer than one in seven saying their success was mostly or fully attributable to it.

Canada's dedicated women's entrepreneurship strategy is worth approximately £3.7 billion, a different economy, a broader scope, but the same stated ambition of structural reform. That is a programme: not a pledge.

For the structural reform of female entrepreneurship in Scotland, the government committed less than half the Techscaler base contract. The £17.5 million flowed through multiple channels, pre-start funds, ecosystem projects, partner organisations, rather than a single ring-fenced pot. The announced commitment is not in dispute. What it was committed to is.

The warning was in the document they published

Before a single pound was committed, the Pathways report told you exactly what would happen if you got this wrong. It did not bury the warning.

Chapter 9 opens without ceremony: there is "a striking lack of dynamic trend data on entrepreneurial participation rates, and almost no readily available data disaggregated by gender and ethnicity."

The consequence was stated precisely: "this makes it impossible to measure the progress or efficacy of any related funded programmes." The footnote points to the 2019 Alison Rose Review, which had made the same diagnosis four years earlier. Pathways cited Rose as proof that every previous effort had foundered on the same absence of data. Then it reproduced it.

The analytical ambition went further. The report mapped the full cause-and-effect tree of female under-participation down to root causes: societal role stereotyping beginning in childhood; an education system that never normalised entrepreneurship for girls; informal male-dominated networks through which capital and opportunity circulate invisibly; the logistical burden of caring responsibilities that falls disproportionately on women; and unconscious, and sometimes conscious bias in investment decisions.

Then it named, with notable precision, the four failure modes that had doomed every previous effort.

The first: normalising the status quo by anchoring on small improvements as if they constituted transformation, "relatively minor measures… uncontroversial and easy to implement," which pass political tests without changing anything. The second: fixing proximate causes while root causes keep regenerating them.

The third: adding to a broken system rather than fixing it. And the fourth, stated with considerable precision, was "favouring tokenism over scaled solutions." Token solutions, the report noted, "may only serve political expediency." Their particular danger: their existence causes concern over the original issue to be stood down. People declare victory. Agendas move on. The problem persists.

The report drew this as a diagram on page 27. It called the dynamic a reinforcing loop. It described the mechanism that produces it: something must be done, this is something, therefore this is enough.

Recommendations 28, 29 and 30 were the ones everything else depended on: a centralised gender- and ethnicity-disaggregated database, compulsory data submission from all organisations receiving public funding, and an annual government analysis of participation trends integrated into the Wellbeing Economy Monitor.

None have been implemented. Three years later, the Women and Equalities Committee arrived at the same conclusion about voluntary approaches at UK level that the Pathways report reached in its failure modes analysis in 2023. The diagnosis ran from Edinburgh to Westminster. The response, in both cases, was a pledge.

Nine pages, six years too late

Pathways Forward launched in September 2023. Its centrepiece was a voluntary call to action for organisations across Scotland's start-up ecosystem.

The report had explicitly identified voluntary pledges as one of the four failure modes. The programme launched one anyway.

Over the following three years, the programme produced a practitioner's guide to Inclusive Entrepreneurship Support, a LinkedIn group, event programmes, cohort training for entrepreneurship support professionals, and two co-branded reports assessing progress.

The practitioner's guide is nine pages long. It is worth examining carefully, because it is the programme's most concrete practical output and illustrates with unusual precision the distance between what the report diagnosed and what was delivered.

The guide opens promisingly, quoting the Pathways structural diagnosis directly: "this is not about individual women lacking confidence or ambition… the barriers are more fundamental, rooted in deep structural and societal causes." Faithful, so far.

Then it turns to what entrepreneurship support professionals should actually do. They should not describe risk-taking as the hallmark of a "real" entrepreneur. They should not default to "guys" for mixed-gender groups. They should offer hybrid event options. They should audit speakers and panellists for diversity. They should follow up on introductions they offer to founders.

These are not new suggestions. They were in the Rose Review in 2019. They have circulated across UK public sector diversity and inclusion guidance for the better part of a decade. The practitioner's guide packaged them as the primary practical output of a three-year, £17.5 million programme.

More precisely: these are the interventions the Pathways report explicitly categorised as failure modes. Telling a programme manager to say "everyone" instead of "guys" is the definition of a token point solution: uncontroversial, easy to implement, and incapable of addressing the structural causes the report spent a hundred pages mapping.

The guide's authors appear to have read the failure mode analysis carefully enough to quote the structural diagnosis in the opening paragraph. They then spent the remaining seven pages delivering the thing the report said must be avoided.

The guide also states its governing philosophy: "the goal is not perfection, it is one incremental shift at a time."

Incremental actions are not worthless. Cultural change does accumulate. A programme manager who stops saying "guys," audits her speaker list, and follows up on introductions may, over time, contribute to a slightly less hostile environment for female founders.

The Pathways report did not dispute this. What it argued, with some care, was that incremental actions become actively counterproductive when they substitute for structural fixes and generate the appearance of progress without the substance. That is the specific condition under which they feed the normalisation loop: not when they accompany mandatory data reporting and compulsory funding conditions, but when they replace them. The practitioner's guide was published into exactly that condition.

The Women and Equalities Committee confirmed in October 2025 that six years of incremental shifts had produced a net negative result on the headline investment figure. The Practitioner's Guide was published after that finding was in the public domain. It advocates incremental shifts anyway.

There is a telling detail in the guide itself. Published in April 2026, it notes that universities are committing to a "shared and reliable approach to data collection." Three years after the Pathways report demanded compulsory, centrally mandated data infrastructure as the non-negotiable foundation of the entire programme, the practitioner's guide is celebrating a voluntary university data-sharing commitment.

The gap between those two things, between recommendation 29 and a voluntary commitment to share data, is the gap between the programme that was specified and the programme that was delivered.

The index measures what it can see

In the absence of recommendations 28, 29 and 30, the programme points to the Female Founders Scottish Scale-Up Index as its primary evidence of progress.

The Female Founders Scottish ScaleUp Index tracks scaling businesses in Scotland with female founders or co-founders that have crossed either £10.2 million in turnover or £5.1 million in assets. There are 139 of them in 2026. The report announces this as an 81% increase since 2025.

Here is what it cannot tell you.

It cannot tell you what is happening in the pipeline that feeds the index. Recent Scottish data shows women representing approximately 54% of new start-ups: a genuine entry point that suggests the ambition and appetite are there. But that figure collapses to 16-20% of employer businesses, and further still to around 4.5% of firms with more than ten employees, down from 7.4% in earlier data.

Somewhere between starting a business and scaling one, the majority of female founders exit the pipeline.

The Pathways report mapped this leakage in detail. It identified the structural mechanisms that produce it.

The Female Founders Scottish Scale-Up Index begins where the attrition has already happened. It cannot tell you where, or why, or whether anything the programme did made any difference to the rate of loss. That would have required recommendation 28.

It cannot tell you whether the 81% increase reflects genuine growth in female entrepreneurship or businesses maturing across a fixed financial threshold. The 81% is real activity: £1.5 billion in revenue, more than 16,000 jobs, genuine resilience with 47% of the 139 businesses operating outside Glasgow and Edinburgh. None of that should be dismissed. But without the baseline data infrastructure recommendations 28 and 29 would have built, it is impossible to say what caused it.

Organic maturation of businesses already in the pipeline. Network effects from three years of awareness activity. Survivors crossing a fixed financial threshold. The index cannot distinguish between these. That is not a limitation of the data. It is a decision.

It cannot tell you what is happening in the sectors where the real investment flows. Women remain substantially underrepresented in high-growth tech, AI, and fintech, the domains where venture capital concentrates.

The index's investment of £116.5 million, concentrated in approximately 20 businesses, reflects that sectoral bias: the firms most likely to have attracted equity are those operating in or adjacent to the domains where investors already have networks and pattern recognition.

This is the root-cause mechanism the Pathways report diagnosed. The index's investment concentration is not an anomaly. It is the predicted outcome of a system the programme did not structurally change.

It cannot revisit the 2% institutional investment figure. The WEC confirmed in October 2025 that this figure had worsened to 1.9% across the UK by 2024. The Pathways programme has not published an equivalent Scottish figure: because the mechanism to generate it was never implemented.

The 139 businesses represent 19% of all visible scaling businesses in Scotland. That is, within rounding, precisely where the Pathways report found it in 2023. The index is tracking the ceiling. The programme was funded to raise the floor. Whether the floor moved is unknowable, because the mechanism to measure it was never built.

The mixed-team premium the report doesn't examine

Even within the data the programme does have, there is a finding that receives no dedicated analysis.

The Female Founders Scottish Scale-Up Index distinguishes between businesses exclusively founded by women and those co-founded by mixed teams. The report celebrates both. It highlights exclusively female-founded businesses, Lazy Day Foods, LS Productions, Amici, as flagship achievements.

Then it notes that McQueens Dairies is the largest business in the entire index by both employment and turnover. McQueens Dairies is a mixed-team co-founded company.

The pattern holds across the index. At the very top of Scotland's visible scaling female-founded businesses, the headline metrics are dominated by businesses that include male co-founders. The exclusively female-founded companies are named and celebrated in the narrative. They are not the ones leading the revenue and employment figures at scale.

The investment data compounds this. Of the £116.5 million in equity investment in Scottish female scaling firms, funds are concentrated in approximately 20 businesses, representing only 10% of total investment in all Scottish visible scaling businesses, despite female-founded businesses representing 19% of companies. The businesses most likely to have attracted that investment are, disproportionately, the mixed-team businesses with access to networks and institutional credibility the market still extends more readily to teams with male co-founders.

The WEC found the same dynamic at UK level. All-male founder teams raised £6.5 billion in 2023 alone, more than three times the amount raised by all-female teams over the entire preceding decade.

The mechanism the Pathways report identified in Scotland operates identically at UK scale: investment partners lack knowledge of domains favoured by female founders; the rarity of investing in women creates a negative feedback loop; it feels riskier because it is uncommon, which prolongs the rarity.

The mixed-team dynamic reflects exactly the market mechanisms the Pathways report diagnosed: differential network access, perceived investment risk, domain knowledge gaps among funders.

The report knew this would happen without structural intervention. The structural intervention was not made. The market produced the predicted result. Presenting that result as evidence of progress inverts the logic of the original diagnosis.

Eight in ten

The most uncomfortable finding in the Female Founders Scottish Scale-Up Index is not the 19% ecosystem share. It is this: eight in ten female founder scaling businesses feel there is little support available for businesses like theirs. Among male-led businesses, four in ten feel the same.

This is 2026 data, from founders who have already broken through £10 million in turnover. The most successful, most visible tier of female entrepreneurship in Scotland. Still twice as likely as their male counterparts to feel unsupported. After three years of a programme specifically designed to change that.

The report calls this "a significant disparity in perceptions." It does not ask why. It does not ask whether three years of pledges, practitioner guides, speaker audits, and hybrid event options made any difference to these founders' actual experience. It does not ask whether the gap has narrowed since 2023, because there is no 2023 baseline: recommendation 30 was never implemented.

The 8-in-10 figure is the most direct available measure of whether the programme changed anything for the people it was designed to serve. It sits in the programme's own report, four lines long, labelled a disparity, and filed under findings. The ministerial foreword does not mention it.

Who is assessing whom?

The Pathways report was co-authored by Ana Stewart and Mark Logan. Mark Logan was Scotland's first Chief Entrepreneur and also authored the STER report that created Techscaler, whose independent evaluation found governance gaps, no success definition, and financial reporting so inadequate that evaluators said they could not do their job.

Ana Stewart subsequently became Scotland's second Chief Entrepreneur and founded Pathways Forward, the organisation that co-published the Scottish Female Scale-Up Index used as primary evidence of progress on the agenda she helped create.

No independent evaluation of Pathways has been commissioned. There are no published outcome targets. The person who co-authored the diagnostic framework leads the organisation that assesses whether it has been addressed.

This is the arrangement chosen for a £17.5 million programme. It is not the arrangement chosen for Techscaler, where an independent evaluation, however constrained by the client's presence on its own steering group, at least produced 193 pages of documented findings.

There is a further structural question. Recommendation 29 would have required organisations receiving public funding to submit disaggregated data as a condition of that funding.

The Pathways Pledge asked them to do so voluntarily. The voluntary instrument was implemented. The compulsory one was not. The Women and Equalities Committee has confirmed, at UK level, that voluntary instruments in this space produce negative returns over six years.

The question of why recommendation 29 was not implemented, whether that reflects practical difficulty, policy judgement, or the preferences of the organisations that would have been required to report, is one that an independent evaluation would have been well-placed to examine. No such evaluation has been commissioned.

The sentence that has not dated

The Pathways initiative has produced language guides, event programmes, a practitioner checklist, two co-branded reports, a LinkedIn group, and voluntary university commitments to "shared and reliable" data collection. The measurement infrastructure the programme's own founding document identified as the non-negotiable foundation has not been built.

The ecosystem share of visible scaling businesses remains 19%, unchanged from 2023. The investment figure has worsened across the UK and cannot be reported for Scotland specifically because recommendation 29 was never implemented.

Women enter the start-up pipeline at 54% and arrive at employer businesses at less than 20%, at firms with more than ten employees at less than 5%. The most successful female-founded scaling businesses in Scotland are disproportionately the mixed-team co-founded ones.

Eight in ten female founders at scale feel there is little support available for businesses like theirs. That finding occupies four lines in the programme's own report.

The economic prize from fixing this is not abstract. Women-led businesses already contribute an estimated £8.8 billion in GVA to the Scottish economy. The WEC put the UK-wide potential from closing the entrepreneurship gender gap at £310 billion.

The 139 scaling businesses in the Female Founders Scottish Scale-Up Index represent £1.5 billion in revenue, real, and welcome, and a fraction of what a functioning pipeline would generate. The ceiling is visible. The floor has never been measured.

In October 2025, the Women and Equalities Committee reviewed six years of voluntary approaches across the UK and found the VC investment share had fallen. Its conclusion: voluntary measures have failed. The government's response in January 2026 was to say it did not rule out future intervention if voluntary measures continued to fail.

The Pathways report identified this exact outcome as a failure mode in 2023 and named the mechanism that produces it: token solutions whose existence allows concern over the original issue to be stood down.

Why has this not been done? The report’s authors, including the person who later became Scotland’s Chief Entrepreneur and now leads Pathways Forward, produced a diagnosis that accurately predicted every failure mode that subsequently materialised.

The UK parliamentary committee independently reached the same verdict on voluntary approaches. Female founders scaling businesses continue to report twice the perception of inadequate support as their male counterparts. The compulsory data infrastructure was never built. The mandatory reporting was never required. The structural interventions were never made.

Three explanations are available. The mandatory reporting and compulsory funding conditions required government will that was not forthcoming, and the programme delivered what was politically achievable rather than what was specified.

Or the programme made a considered judgement that voluntary approaches were the reachable version of the agenda, trading ambition for implementation.

Or the dynamic the report itself identified took hold: something was done, this was something, and the pressure to do the harder thing dissipated.

The evidence does not distinguish between these. An independent evaluation would have been well-placed to try. None was commissioned.

Chapter 9 remains the document’s most precise contribution. Without the data infrastructure, it said, measuring progress or efficacy is impossible. Three years later, that sentence has not dated.

It is a common concern around public contracts whether they deliver value for money. Most businesses never tender. The cynical view, and the procurement world has no shortage of cynics, is that the outcome is often known before the notice goes live.

The Techscaler procurement was not that. It was an open procedure. Four organisations tendered. The process ran as published.

What happened afterwards is a different question entirely.

Techscaler is a flagship manifesto commitment from the Scottish Government: designed to transform Scotland’s entrepreneurial economy, built on the foundations of the STER report published in 2020 by Professor Mark Logan, the former Chief Operating Officer of Skyscanner.

xProfessor Logan was subsequently appointed Chief Entrepreneur to oversee the implementation of his own recommendations.

The programme launched with ambition that felt, for once, proportionate to the scale of Scotland’s tech problem. Genuine talent. Real resources. A first year that looked, from the outside, like something was actually being built.

The evaluation would later document stakeholder concerns about whether the organisation had the right capabilities to deliver what the programme required. The money kept arriving. The accountability stayed thin.

By default, especially with an election around the corner, this programme cannot fail. It is the one designed to make Scotland a scale-up powerhouse.

The early evaluation of the Techscaler Programme 2022-2024 suggests otherwise.

The number nobody mentioned

Begin, as any serious assessment of public spending must, with the contract value. Not the figure that has appeared in every ministerial statement, every press release, and every parliamentary question about Techscaler. The figure on the UK government’s own Find a Tender procurement database, published 3 August 2022, Notice 2022/S 000-021239.

Total value of the contract: £59,237,767 excluding VAT.

The Techscaler procurement was an open procedure. Four tenders were received. The process was covered by the Government Procurement Agreement. On the face of the published notice, it ran as it should have run.

Which makes what followed all the more remarkable. The public, the media, and the Scottish Parliament have spent three years discussing a £42 million programme. The contract registered on the government’s own procurement database is worth £59.2 million.

The difference is £17 million. It has not appeared in a ministerial statement. It has not appeared in a parliamentary answer. It does not appear in the independent evaluation whose authors spent a year formally noting that financial data was being withheld from them.

The explanation is that the £42 million figure represents the base contract value, with the £59.2 million representing the maximum including two optional extension years to 2029. That explanation is reasonable. It is also three years late. It has never appeared in a ministerial statement, an annual report, a parliamentary answer, or a 193-page independent evaluation of the programme’s finances.

The number has been on a public database since August 2022. The explanation has not been anywhere.

Welcome to Techscaler. Where the number in the Deputy First Minister’s foreword and the number on the procurement database are different numbers, and where the difference went unexplained for three years.

The independent evaluation was commissioned by the Scottish Government and delivered by EKOS.

It was guided by a steering group that included officials from the Scottish Government’s own Chief Economist and Economic Development directorates: the same directorates responsible for overseeing the programme being assessed.

The client commissioned the review. The client shaped the questions. The client sat on the steering group throughout.

This is worth understanding before reading any of what follows. And still: some of the numbers got through.

Appendix D of the evaluation records the central challenge the EKOS team encountered when they arrived to assess the programme.

In their own words, published by the Scottish Government in February 2026: “there is no clear definition of success (or what a successful end point looks like) and there are no intermediate measures/metrics (such as defined targets) to assess progress and performance against.”

By March 2025, £22.8 million had been spent.

Without a definition of success you cannot fail. Every number becomes a positive indicator. Every headline is defensible.

Every evaluation becomes, structurally, a document that counts activity rather than measures impact: enrolments, events, membership sign-ups, without ever asking whether any of it changed anything.

Which is exactly what this one is.

The evaluation recommends, as its ninth priority, that the Scottish Government and CodeBase should “define what success looks like” and “set SMART objectives.” Specific. Measurable. Achievable. Relevant. Time-bound.

The theory that came after the money

A theory of change explains, before public spending begins, how a programme’s activities will produce the outcomes it seeks. Without one, you are not running a programme. You are running a series of events and hoping.

Techscaler’s theory of change was developed after the programme launched. Page 168 of the evaluation records this.

The evaluators note that doing it beforehand “could have supported partners to map backwards: work in reverse from the final goal to identify what short and medium term outcomes must occur.”

They designed the programme. They started spending. Then they tried to work out what it was for.

Page 66

The number the Annual Report did not publish is on page 66 of the evaluation.

When early-stage members, the founders at ideation and start-up stage who make up 68% of the programme’s membership, were asked what proportion of their success could be attributed to Techscaler, 13% said fully or mostly attributable to the programme. On the same page, 75% said they would have started their business without it. Fewer than one in seven.

The technical term is deadweight. Three quarters of the founders this programme was designed to help did not need it to achieve what they achieved.

Now consider how those founders were selected for the survey. The methodology appendix records that EKOS used CodeBase’s own member database.

CodeBase provided the internal categorisation that determined which members were considered sufficiently engaged to be included. Of 978 key company contacts, 330 were removed from the sample because CodeBase categorised them as insufficiently engaged.

The evaluators acknowledge the sample “cannot be viewed as wholly representative.”

If CodeBase helped determine who was asked, and those people still produced a 13% attribution rate, the question is not complicated. What would an independently selected sample have found?

The Annual Report contained the testimonials. Page 66 was not mentioned.

The mentors who called it out

The Annual Report celebrated the mentorship programme. Net Promoter Scores (NPS). Testimonials. The picture of a world-class support network connecting experienced operators with ambitious founders across Scotland.

The independent evaluation, drawing on surveys of 43 mentors and 12 follow-up qualitative interviews, tells a more complicated story.

Mentors described being matched with founders with “barely formulated ideas” who “did not know their product, market and/or customers” and who were “at far too early a stage” for mentoring to add value.

One mentor: “Pretty basic stuff from a business perspective: that doesn’t need one to one mentoring.”

On feedback loops: “some mentors have not always felt their feedback to CodeBase has been listened to, reflected on, or acted upon.” The evaluation attributes this partly to “CodeBase staff not having direct experience of starting and scaling tech companies” and “a perception that CodeBase was not open to feedback.”

On sessions: “An hour a month is not enough if you are a serious business and far too much if you are just a person with an idea. There’s no distinction between those two companies because they have been defined at a particular stage.”

One mentor’s verdict on the programme’s fundamental problem: “There are no north star metrics. This is needed for everyone to understand and get behind.”

Then there is the detail that deserves its own moment. Mentor notes, the feedback from experienced operators about the founders they were working with, the signals of who had potential and who was struggling, the granular intelligence that any serious programme would treat as its most valuable asset, were being recorded in Google Sheets.

Not a CRM. Not a programme management system. Not anything that could generate longitudinal analysis, flag at-risk founders, or build institutional knowledge across the team.

The evaluation records that mentors felt their feedback “had not always been listened to, reflected on, or acted upon” and partly attributed this to “ineffective processes and mechanisms to learn and understand where companies were at.”

And then there is Reforge, the prestigious Silicon Valley career development platform offered to scaling members as a premium benefit, cited in the Annual Report as evidence of world-class provision. The evaluation notes that CodeBase “does not receive module completion data” from Reforge.

They are paying for a platform, offering it to founders as a headline benefit, celebrating it in annual reports, and have no way of knowing whether anyone is actually using it.

Google Sheets for mentor notes. No completion data for the flagship education partnership. A 13% attribution rate. And a mentorship NPS of +92.15.

The Annual Report had the NPS. It did not have any of the rest of this.

The mentor pool raised further questions. Of 199 Techscaler mentors on record, only 125 are currently active. The evaluation calls for “a renewed focus on ensuring mentors have direct experience of starting and scaling companies.” Seventy-six percent of mentors had received no training since joining the programme.

The programme that describes mentorship as its most valued component has 74 inactive mentors, no completion data for its premium education platform, Google Sheets for its feedback system, and staff who, according to those mentors themselves, do not always have the experience to act on what they are being told.

The financial breakdown authors never saw

Table 3.4 of the evaluation sets out the financial overview in what the evaluators describe, with considerable restraint, as summary format.

Their direct words: “the evaluation team only received the information in summary format” and “would have welcomed access to a more granular financial breakdown.”

The independent evaluators, appointed by the Scottish Government to scrutinise £42 million of public spending, could not get the financial detail they needed to do their job.

What the summary shows: staff costs across the two financial years covered by the evaluation total £13 million: 63% of all programme expenditure. Not education. Not the Silicon Valley missions. Not the hubs. Salaries. Sixty-three percent of everything spent on staff, in a programme with no success definition, a retrospective theory of change, and a 13% attribution rate among the founders those staff were employed to support.

One stakeholder, quoted directly in the evaluation, put it plainly: “Too many staff — they are now a bit top heavy, and this has an impact on spend and returns.”

The report found: “The spending on staff costs was viewed by some stakeholders as very high,” adding: “CodeBase was required to scale rapidly and is now facing internal challenges — staffing, governance, housekeeping. Resource distribution was considered to lack transparency and regional equity.”

The evaluation adds: “a more detailed breakdown would be useful to enable further interrogation.” Nobody provided one.

The Scottish Government says the staffing costs are detailed within the contract. The evaluators say they couldn’t get the detail. One of those things is more useful than the other.

Inside the organisation

The evaluation provides its own corroboration of this picture. It records that some stakeholders viewed CodeBase as “too techy and too rigid in their approach” and noted “the impact of the big jump in team size as having an impact on delivery.”

It records “questions as to whether they had the right staff and mentor pool to deliver for growth and scaling companies.” It notes that the “coolness of CodeBase was being eroded as they now needed to work on the governance and scrutiny aligned to public funding.”

One stakeholder who describes being close to the organisation: “I am relatively close to the organisation, and I still struggle to know who to speak to and get any kind of insight into what’s coming up.”

Another: “CodeBase had a good base to grow and were close to the market. Strong delivery partner who had lots of accelerator experience. They were however a small player, so the size of the Techscaler Programme is quite a jump for them as is the pan-Scotland delivery model.”

The national programme that wasn’t and is now less so

In September 2025, Deputy First Minister Kate Forbes was explicit about what Techscaler was for. “The whole premise of the programme,” she said, “was to ensure that the initiative was not concentrated only in Glasgow and Edinburgh and would also be able to support entrepreneurs right across Scotland. That is what makes it such a critically important programme.”

The Deputy First Minister said the whole premise was not to concentrate on Glasgow and Edinburgh.

The evaluation, covering only the period to December 2024, already found that half of all events during the first two years took place in Edinburgh and Lothians.

The programme specification itself, agreed between the Scottish Government and CodeBase before delivery began, assumed 50% of activity in Edinburgh, 25% in Glasgow, 10% in Dundee, 10% in Aberdeen, and 5% in Inverness. A contractual assumption that three-quarters of a national programme would happen in two cities.

Edinburgh: 408 events, 8,756 attendees. Glasgow: 85 events. Aberdeen: 49 events. Dundee: 78 events. Inverness: 60 events.

Edinburgh held more events than every other hub combined.

The evaluation records that stakeholders raised “a perception in some quarters that the Techscaler Programme has a focus that does not extend beyond the central belt” and includes a formal suggestion for “an approach that extends beyond the central belt.”

The hub model that never worked and the ranking that confirms it

The regional hubs were a core recommendation of the STER report, a contractual deliverable, and a central element of the public narrative. Physical spaces across Scotland. The visible infrastructure of a national programme.

The evaluation’s fifth priority recommendation: “the existing regional hub approach is not delivering as intended and changes in market dynamics means it is unlikely to be successful in its current form. A more flexible, user-centric model is needed.”

Eight percent of members surveyed had used a hub for tenancy, hotdesking or co-working. “Regional hub operations remain resource intensive, with 26 staff involved, not including central management or administrative support or event marketing costs and meet-ups.”

CodeBase does not hold occupancy data for the hubs operated by partners, which is most of them.

One stakeholder: “A hub is only as strong as its weakest members — regions where there are less talent and the companies are not as mature will not deliver the same benefits.”

Another: “The CodeBase hub in Edinburgh works really well. Places like Aberdeen and Dundee less so.”

Twenty-six staff. Unknown occupancy. Eight percent usage. A priority recommendation to redesign.

The FT’s ranking of leading European start-up hubs provides independent external validation of the trajectory. CodeBase ranked 76th.

The following year it did not appear in the top 150. It now ranks 176th. The ranking is based on user feedback and expert evaluation.

The Annual Report had photographs of the hubs.

The trips that cost £45,500 each

The international missions, Silicon Valley, Japan, Singapore, a China pilot, were presented in the Annual Report as unqualified highlights. The language of transformation. The photography of ambition.

The evaluation provides a number the Annual Report did not.

A footnote in chapter 8, drawing on data provided directly by the Scottish Government: “the average total cost (that is, flights and accommodation) for six international programmes was circa £45,500 per trip.”

Forty-five thousand, five hundred pounds per trip. For missions of approximately ten to thirteen founders per cohort. Measured primarily, in the evaluation, by mindset shifts, confidence-building, and network formation.

The evaluation calls for “more transparency and scrutiny in selecting companies, so that those with the most to gain were prioritised.” Mentors were “not always clear on how the application or assessment process worked in practice.”

One member said the most effective element of the international programme was “the hands-off approach to it, so putting it on the founders to find the support they need was good.”

The managed itinerary was not the valuable part. Being in the room, largely left to their own devices, was the valuable part.

If the most effective element of a £45,500 trip is founders self-directing once they arrive, the question no Annual Report has asked is whether a direct travel grant would produce better outcomes for less money.

The 'mathematical prayer' of ROI

The economic impact assessment at the heart of the evaluation produces a headline return on investment figure of £6.91.

For every pound spent, £6.91 of economic value was generated. It is the kind of number that will travel into ministerial briefings and funding submissions without its qualifications attached.

The qualifications are extensive.

The assessment is built on responses from 69 companies, drawn from a membership of over 1,400. The confidence interval is 11%.

An economic impact assessment built on 69 respondents and a 13% attribution rate is not a return on investment; it is a mathematical prayer.

The £6.91 headline return is built on a small sample of 69 companies, a ‘relatively low’ 23% additionality rate acknowledged in the evaluation itself, and projections scaled up by a factor of 9.4, qualifications that make the figure more aspirational than conclusive.

One stakeholder had already identified the core problem: “The programme annual reports are very colourful and full of big numbers but what is additional and attributable to the Techscaler Programme?”

A return of 6.91, built on those foundations, is not the same number as a return of 6.91.

The gap between the blueprint and what was built

Woven through the evaluation is the uncomfortable distance between what the STER blueprint proposed and what Techscaler became.

Logan’s report proposed a programme with particular emphasis on growth and scaling companies: the ones that would generate the exits, the recycled capital, and the experienced operators a maturing ecosystem requires.

What emerged was heavily weighted toward ideation and early-stage founders. The widest, shallowest end of the funnel. The evaluation finds that growth and scaling companies received “more limited than expected” engagement. One of the programme’s core courses was found, in its own quarterly review, to be “not yet serving” its core purpose.

A core course not yet serving its core purpose. Three years in.

One stakeholder: “There are clear support gaps in terms of sector and stages of development — at the top end of scaling is an issue and the middle bit pre-scale is a gap.”

A mentor: “Techscaler, which in my view, is now a generalist.”

‘Blurred lines of ownership, accountability, and purpose’

The contract was awarded in July 2022. Worth £42 million. The largest single entrepreneurship support investment in Scottish history.

The Scottish Government did not require a prospective theory of change. Did not specify success metrics beyond activity outputs. Did not require independent evaluation, the Annual Reports were written by the delivery organisation and assessed by nobody. Did not require granular financial reporting, the quarterly submissions were, as the evaluators found, inadequate for meaningful oversight.

And then sat on the steering group of the independent evaluation it eventually commissioned, placing officials in the position of simultaneously shaping the questions and being accountable for the answers.

Running beneath all of this is a structural confusion that the evaluation documents and that nobody in three years of annual reports has resolved.

The line between CodeBase and Techscaler has never been clear. To the public, Techscaler is a Scottish Government programme.

To the ecosystem, it is CodeBase. The evaluation records that stakeholders were persistently confused about “the difference between the Techscaler Programme and CodeBase” and describes “overlapping branding between the Scottish Government, CodeBase, and the Techscaler Programme” that has “blurred lines of ownership, accountability, and purpose.”

One stakeholder: “CodeBase and the Techscaler Programme are well-known by start-ups: if you’re embedded in the ecosystem, you will know CodeBase, but if not then, don’t think it’s well known or understood.”

The evaluation’s own recommendation calls for CodeBase to “clarify the distinction between CodeBase and the Techscaler Programme: define the Techscaler Programme as the government-funded support programme, and CodeBase as the delivery partner.”

Three years in. Still needs clarifying.

The blur is not a branding problem. It is a governance problem. When the public sees Techscaler, they see a Scottish Government programme.

When something goes wrong, CodeBase can point to the contract. When something goes right, CodeBase takes the credit.

The annual report is presented as a Techscaler document. It is written by CodeBase. The public funding goes to CodeBase. The brand equity accrues to CodeBase. The accountability sits nowhere in particular.

Which is, of course, exactly how it has worked for three years.

The evaluation’s Appendix I documents the changes CodeBase has made since 2024. The core education courses have been replaced. The mentorship structure has been redesigned. Financial reporting to the Scottish Government has been revised. A new hub strategy is in development. A new stakeholder engagement strategy is in development.

Every change corresponds to a finding in the evaluation. Every finding identifies something that was not working. The evaluation was commissioned in January 2025. The changes, in several cases, were already underway before it was published.

CodeBase calls this evolution. The evaluation calls it eleven recommendations.

The evaluation’s eleventh recommendation, the last of eleven, calls on CodeBase to provide more detailed financial reporting to the Scottish Government.

The Scottish Government has been receiving financial reports from CodeBase for three years. Those reports were inadequate. The evaluators said so. The Scottish Government signed off on them throughout.

It is now being recommended to ask for something better. CodeBase says many of the recommendations align with changes already underway.

All 11 recommendations, from defining success metrics upfront to improving financial transparency, address gaps that the evaluation shows were present from the start, raising questions about whether the programme's foundations were as robust as its ambitions.

What comes next

Three years remain on a contract with a base value of £42 million. The independent evaluation has documented, across 193 pages, that the programme has no success definition, cannot account for 63% of its spending, built its intellectual framework after the money started flowing, tracked its mentor intelligence in Google Sheets, offered a premium education platform whose completion data it cannot access, and is running physical infrastructure that 92% of its members do not use.

The evaluation, covering the programme’s first two years, found that Edinburgh held more events than every other hub combined. It found that the contractual assumption built in before delivery began allocated 50% of activity to Edinburgh and 25% to Glasgow. It found that stakeholders raised a perception that the programme did not extend beyond the central belt.

Three years remain on the contract. The evaluation has eleven recommendations. Every one of them is a thing that should have been in place before the contract was signed.

Scotland’s tech ecosystem deserves better than glossy reports and footnotes that quietly walk back the headlines.

The minimum standard for £42 million of public money is simple: independent evaluation from day one, clear attribution, longitudinal tracking of founder outcomes, and the willingness to redesign when the evidence demands it.

Until then, the founders in the Highlands, the South of Scotland, and the regions beyond Edinburgh and Glasgow will keep waiting: and the numbers will keep telling a different story from the one being told in ministerial statements.

Deputy First Minister Kate Forbes said: “The Techscaler programme was created to strengthen Scotland’s entrepreneurial environment by giving company founders the skills, support and connections needed to build globally competitive businesses.

“The main expenditure of Techscaler is staffing costs which are detailed within the contract. All spend is carefully considered and measured against potential benefit, which in the case of the international programme saw global engagement with a range of customers, with new contracts and investments secured.

“We proactively evaluated the first two years of the programme to ensure continuous improvement and published this for full transparency.”

A CodeBase spokesperson said: “Techscaler has supported over 1,500 startups and scaleups to date, helping to strengthen Scotland’s technology ecosystem and open pathways to markets and investment.”

“CodeBase welcomes the EKOS early evaluation of Techscaler’s first two years, 2022 to 2024, where we moved quickly to support Scotland’s most ambitious tech founders. As we enter the fourth year of Techscaler, many of the recommendations align with changes already underway to better support founders from early traction through to investment and scale.

“We only invoice verifiable expenditures permitted under the Techscaler contract.

“While we recently underwent a reorganisation which included a number of voluntary redundancies, our support for founders and businesses across Scotland and its regions is unwavering.”

It also claims that three in four of its founders are neurodivergent. No explanation. No methodology. No apparent awareness that this figure is three times the national average.

A report that cannot sense-check its own headline statistics is telling you something. The question is whether anyone in the Scottish Government read carefully enough to notice.

The Deputy First Minister's foreword opens by citing the £257m figure as evidence the programme is working. Twelve pages later, in a footnote, the same document admits it cannot claim credit for any of it. Nobody appears to have noticed the contradiction: or if they did, nobody thought it worth resolving.

But, that headline figure is exactly the number needed by politicians to cite to shout out about its success.

Perfect for when you need a number that travels and doesn’t ask to be examined. The First Minister demonstrated exactly that at the report’s launch in Dundee, citing it as proof of momentum.

So good, you might say, that its doubters will be silenced and the case for another year of public money is effectively made. Less annual report, more manifesto. Less accounting for what the £42 million achieved, more vision document for what it might yet become.

It is also, in any meaningful sense, made up. Not fabricated. Not technically false. Just carefully constructed to imply something it cannot actually demonstrate.

CodeBase, the organisation tasked with running Techscaler, neatly admits this quietly, 12 pages into the document as a “note:” it states: “Techscaler tracks funding not to claim credit, but because it signals how private markets perceive Scotland’s entrepreneurial potential”. Admitting, they didn’t raise it but it was raised by companies who happened to be Techscaler members.

Whether the programme had anything to do with it is a question the report does not ask, because asking it would require answering it.

The headline figure is designed to impress a minister skimming an executive summary. It is not designed to withstand scrutiny. These are different design briefs.

Welcome to Scottish tech ecosystem reporting, where the headline is always good news, the caveats are always in footnotes, and the organisation writing the report is always the one whose funding depends on its conclusions. This is not a conflict of interest. This is just how it works.

When the data stops making sense

Read it properly and a pattern emerges. The flattering numbers are large, prominent, and unreferenced. The uncomfortable ones are small, tabled, and footnoted. This is not accidental. It is editorial policy. And once you see it, the document becomes a different kind of interesting.

Take the neurodivergent statistic. Techscaler reports, with apparent pride, that 75.5% of its founders identify as neurodivergent. Three in four. In a country where the general population figure sits somewhere between 15 and 20%.

This number either represents the most extraordinary self-selection effect in the history of entrepreneurship, or it tells you something about what happens when self-reported DEI surveys meet communities where certain identities have become socially valued.

The report does not pause to consider which. It presents the figure as a positive headline and moves on.

This matters: not because neurodivergence in founders is unimportant, but because a report that cannot sense-check its own statistics cannot be trusted to evaluate anything else either. If the DEI data is this casually assembled, what does that tell us about the rest of it?

Then there is the completion rate. Tucked into a table, presented without comment: Discovery programme completion at 43%. Which means 57% of founders who enrolled did not finish.

On a publicly funded programme. In a document otherwise committed to relentless positivity, this figure simply sits there, unremarked upon, waiting for someone to notice it.

Losing more than half your participants is not a data point. It is a finding. The difference between the two is whether you’re running a programme or writing a brochure.

It records the number and moves on. Nobody asked why. Nobody was asked to. Fifty-seven percent of publicly funded participants dropped out of a publicly funded programme. The public, as yet, has not been told. How much of that £42 million was spent on programmes that more than half the people they were designed to help quietly walked away from?

It is also worth noting that the 1,591 member company figure, one of the programme’s headline reach statistics, comes with a quiet caveat acknowledging that individuals associated with multiple companies may be counted more than once.

How much more than once, and what effect this has on the headline number, the report does not say. A document genuinely interested in accuracy would have led with the adjusted figure. This one leads with the bigger one.

The conflict that dares not speak its name

Techscaler is delivered by CodeBase, Scotland’s largest tech incubator, under a Scottish Government contract won in 2022. CodeBase receives the public funding to run the programme. CodeBase writes the annual report assessing its own performance.

None of this is disclosed as a tension. It is simply how it works.

CodeBase’s Chief Strategy Officer, Jon Hope, contributes a thought-leadership piece arguing that Scotland’s core problem is not capital scarcity but founder capability and that what the ecosystem needs is precisely the skills-building, mentorship, and connectivity CodeBase provides.

The argument may hold water. Scotland does face genuine gaps in investable founder readiness. But presenting it as objective analysis, inside a document whose funding depends on that diagnosis being correct, without any acknowledgment of the obvious circularity, is a remarkable editorial choice.

It is the equivalent of asking a surgeon whether surgery is required, then publishing their answer as independent medical advice.

Mr Hope writes: “Techscaler isn’t about distributing cheques. It helps Scotland build investable start-ups.”

This is true. It also happens to be the only argument that justifies Techscaler’s existence over simply distributing cheques. The report does not entertain the alternative. It cannot. Doing so would require acknowledging that alternatives exist.

This arrangement is not hidden in the Scottish tech scene. Those inside it understand the tensions it creates. The international missions illustrate the point.

The report showcases them as unqualified highlights, Silicon Valley, Japan, Singapore, a China pilot, with carefully curated metrics: 1,275 connections made, 14 contracts, 5 jobs created in Japan.

What it omits is any reflection on whether the managed itinerary delivers maximum value, or whether a direct travel grant and a founder left to their own devices might yield better results for the same spend. Those questions circulate among founders. They do not circulate in this report.

A genuinely accountable document would surface the trade-offs, or at least acknowledge the limitation. This one does not.

It is not designed to resolve these tensions. It is designed to renew the mandate.

What the data actually shows

There is a broader data problem the report does not acknowledge. The ecosystem intelligence underpinning its conclusions was supplied by Beauhurst, an independent research firm.

Techscaler’s own longitudinal data, four years of programme participation, founder trajectories, company outcomes, is nowhere in the document.

An organisation that has been running structured programmes since launch, collecting enrolments, tracking mentorship sessions, and recording completion rates, apparently has nothing to say about what happened to the founders afterwards.

The reviews and testimonials that do appear are uniformly positive. This is not surprising. The founders providing them are, in many cases, still within the programme ecosystem, still seeking access, still dependent on the relationships it provides. The structural incentive to say something positive is obvious. The report does not mention it.

There is also no comparison with previous years. No account of what changed, what improved, what failed, and what was learned. A document genuinely interested in accountability would benchmark itself against its own history. This one arrives each year as if the previous one never existed.

The Beauhurst data, however, paints a picture the executive summary does not quite match.

Scotland now has 1,614 high-growth tech companies, up 34.6% since Techscaler launched. Investment in 2024 reached £671 million. AI investment rebounded to £113 million in 2025 after falling to £43.6 million the previous year. These are real numbers, independently sourced, and they tell a story of genuine momentum.

They also tell a story of persistent structural weakness, if you read carefully enough.

Scotland has 17 universities. Ireland has 7. Scotland has 1,614 high-growth tech companies. Ireland has approximately 4,658.

That ratio, roughly three times as many companies from less than half the university base, is not in the report.

It can be derived from the data in the report, but drawing the comparison explicitly would require acknowledging that something is not working at scale, and that is not the kind of conclusion a funding renewal document tends to reach.

More universities than Ireland. Roughly a third of the tech companies. The data is all there. The comparison is nowhere.

The spinout data adds texture. Investment in Scottish university spinouts reached £194 million in 2025, down from £213 million the previous year, despite the broader market recovering. Scotland has extraordinary research assets.

Converting them into scaling companies remains the unsolved problem. The report celebrates the inputs, programmes, missions, mentorship sessions, without being able to demonstrate any causal relationship to the outputs that actually matter.

And the deal count, buried in the investment data, shows something quietly significant: in 2025, more money went to fewer companies.

Scotland’s investment story is becoming more concentrated, not more distributed. Whether Techscaler’s regional expansion, Dumfries and Galloway with 60 members, the Highlands with 91, is genuinely reaching underserved founders or providing political cover for Edinburgh-centric activity is a question the report is not designed to answer.

Marking your own homework

A word on the satisfaction scores, because they deserve scrutiny. Mentorship Net Promoter Scores (NPS): +92.15. Events NPS: +77.5. Catalyst programme NPS: +53.96. These are presented as evidence of programme quality.

They are not.

They measure one thing: whether participants would recommend the programme to someone else. They do not measure whether it made a material difference to their business. They do not measure whether someone who skipped it would have done better or worse. They measure satisfaction, and in a free programme, with curated content, experienced mentors, and a community of peers, satisfaction is not a high bar to clear. You are asking people whether they enjoyed something that cost them nothing.

The scores have no sample sizes attached. No response rates. No benchmarks against comparable programmes. No indication of whether the founders who dropped out, the 57% who didn’t complete discovery were invited to respond at all. They almost certainly were not or if they were, their reviews were quietly dropped.

An NPS calculated from completers only is not a measure of programme quality. It is a measure of what people who stayed thought of what they stayed for.

There is a word for this in research methodology. It is called survivorship bias. The report does not use it.

What good would actually look like

The evidence in this report does not make a confident case for Techscaler’s current model. Fifty-seven percent of Discovery participants left. The satisfaction scores exclude the people who walked away.

The outcome data was borrowed from a third party because apparently none was collected. The headline investment figure was disclaimed by the organisation that published it. The Deputy First Minister cited it anyway.

This is not a programme confidently accounting for £42 million of public money. It is a programme hoping nobody looks too closely. The founders, many of whom ignore the itinerary on international missions and self-direct their own outcomes, appear to have reached a similar conclusion.

Scotland’s tech ecosystem apparently does not need to follow the rules that apply everywhere else in evidence-based public spending. No independent evaluation. No control group. No longitudinal tracking. No competition for delivery. Just the same organisation, renewing its own mandate, year after year, with a report it wrote itself.

So here is what the money should actually buy.

A genuine third-party review of the programme: not a Techscaler annual report, but an independent assessment with access to founder outcomes, dropout interviews, company trajectories, and the ability to publish conclusions the delivery organisation would find uncomfortable.

This is not radical. It is the minimum standard for any publicly funded intervention of this scale.

A travel grant, administered simply and directly. If the evidence suggests founders get better results when they self-direct their international engagement, stop funding the itinerary and fund the founder. The question of whether the managed mission adds value is answerable. Ask it.

And consider whether a portion of this budget should fund something closer to Y Combinator: highly selective, high-intensity, built around the one percent of founders with genuine global ambition. Specific support. Hard milestones. Real accountability. Traction as the measure, not attendance. Scotland does not need more workshops. It needs more exits.

The bigger question

Scotland has genuine tech assets: world-class universities, a growing cluster of ambitious founders, improving access to early-stage capital. The question of whether it can convert those assets into the kind of scaling ecosystem that Ireland and Estonia have built is one of the most consequential economic policy questions the country faces.

That question deserves honest measurement. It deserves evaluation frameworks designed to find problems, not to avoid them. It deserves reports written by people with no financial stake in the conclusions.

What it has is Techscaler’s 2025 Annual Report: a document with a £257.6 million headline that its authors admit means nothing, a 75.5% neurodivergent figure that no one sense-checked, a 43% completion rate presented without comment, and an Ireland comparison the data makes possible but the report declines to make.

It is a very polished piece of window dressing. The view through the window, if you look carefully, is rather more complicated.

On page 68, in a section titled Looking to the Future, Stephen Coleman and Steven Drost, the men whose organisation designed, delivered, and evaluated this programme, offer a closing thought. “The real measure of Techscaler’s success,” they write, “will always be the ambition and achievements of our founders.”

It is a generous sentiment. It is also the only honest line in the document.

Coleman and Drost built CodeBase. CodeBase runs Techscaler. Techscaler funds CodeBase. The report assessing whether that arrangement has worked was written by the people it works for. The ecosystem data underpinning its conclusions was supplied not by Techscaler but by Beauhurst, an independent research firm. After four years and £42 million, the programme does not appear to have generated its own longitudinal data on founder outcomes. It has borrowed someone else’s.

And on page 68, having spent sixty-seven pages presenting metrics that measure activity rather than outcomes, satisfaction rather than impact, and inputs rather than results, they quietly confirm what a more rigorous evaluation would have found on page one.

The real measure will always be the founders. It is not in this report.

The organisations receiving public money to build Scotland’s tech ecosystem are the same organisations assessing whether it is working.

Until that changes, documents like this one are not quite evaluations. They are something more familiar: the best obtainable version of institutional reassurance. Funding applications, dressed up with better photography. The Scottish Government has been looking at the pictures. The question is whether anyone will finally read the small print.

They did not need to do this. They are busy. And yet here we are, adding to a genre of document that has existed since at least 2019, when the Rose Review said largely the same things, to largely the same applause, followed by largely the same amount of nothing.

We know this because, in October 2025, the Women and Equalities Committee (WEC) ran the numbers.

Female founders received 2% of venture capital in 2024. Down from 2.5% in 2023. Six years of voluntary codes, awareness campaigns, and warm words from people who chair things, and the share went backwards.

In a single year, all-male founding teams raised more than three times what all-female teams raised over the previous decade combined.

Male-led AI start-ups averaged £5.3 million in funding. Female-led ones averaged £800,000. For the same sector. The WEC’s conclusion was unambiguous: voluntary measures have failed. State intervention is now necessary.

The Rise Report’s headline findings will therefore surprise no one. Women receive 2% of venture capital. Childcare costs three times more than in Canada. Eight out of ten young people cannot name a single female entrepreneur.

The funding process is described, variously, as “hard, long, degrading,” and, in what may be the most British understatement of the decade, “not fun.”

The good news is that there is now a £635 million investment pool specifically for female founders.

The bad news is that the total UK venture capital market runs at roughly £20 billion a year, the Industrial Strategy allocated £16 billion to sectors it didn’t once mention women in, and the government’s own innovation agency, Innovate UK, faced with overwhelming demand from high-scoring female applicants, left £2 million unspent rather than fund them.

It later admitted it had “prioritised wrongly.” The assessors, per a Freedom of Information request nobody should have needed to file, were 81% male.

What makes The Rise Report different from its predecessors, its authors argue, is that it goes beyond statistics to capture lived experience. Four hundred and thirty-six thousand words of it.

And they are right, the voices are sharp, clear, and remarkably patient given the circumstances. The founders know exactly what they need. They have written it down.

Again.

The result is one of the most comprehensive portraits of female entrepreneurship in Britain to date, and the latest entry in a genre that has been running since at least 2019.

The question neither report can quite answer, buried politely beneath their calls to action, is why, six years after the Rose Review identified the same three problems, the share of venture capital going to all-female teams has moved from 2.5% to 2%. At this trajectory, parity arrives sometime around 2096, assuming anyone is still writing reports about it.

The WEC’s answer is that the system is not broken. It is working precisely as designed, by the 86% of angel investors who are male, the 85% of senior venture capital roles held by men, and the 85% of investment committee seats occupied by men.

Research shows female investors are twice as likely to back women-led businesses. The composition of decision-making has barely changed in six years, because nobody required it to.

The Rise Report celebrates female founders. It should. They are building profitable businesses, employing people, and generating returns that outperform their male-funded peers by 35%, with a fraction of the capital.

The WEC puts the forgone economic value of this market failure at £310 billion. GDP left on the table because the people writing the cheques prefer to write them to people who look like them.

Britain has now produced enough reports to wallpaper a reasonably sized boardroom. The question is no longer whether anyone knows what the problem is. It is whether anyone in a position to fix it will choose to, or whether they will commission another report to confirm they haven’t.

That is the context in which this report lands. It deserves to be read carefully. It also deserves to be read alongside the Women and Equalities Committee report from October 2025, which arrived at the same diagnosis and finally said what previous inquiries had been too polite to say directly: voluntary measures have failed, and state intervention is now necessary.

They did not choose entrepreneurship. It chose them.

28% started out of passion. Fine. But the same 28% started because of frustration with previous employment. Another 28% wanted autonomy, specifically because they had experienced workplaces that offered none. 24% needed flexibility around childcare. 10% were made redundant.

More than half of these founders were not inspired into entrepreneurship. They were pushed out of employment that failed them: rigid structures, unsupportive cultures, workplaces that treated caregiving responsibilities as a personal inconvenience rather than a structural reality.

The policy conversation about female entrepreneurship tends to focus on encouraging more women to start businesses, as though the barrier is aspiration or confidence.

The Rise Report data suggests the pipeline is not the problem. These women are already starting businesses, under adverse conditions, with less capital, fewer networks, and caregiving responsibilities that their male counterparts are statistically less likely to carry at the same intensity. They started because they had to.

The question is not how to get more women to start. The question is what happens to those businesses once they exist. The answer is: not enough.

More than half want to scale and exit. The market has decided otherwise.

53% of 2,225 female founders defined long-term success in cold, hard financial terms: revenue, profitability, wealth creation, long-term security for themselves and their teams.

The single largest category. Not social impact. Not flexibility. Money.

38% are explicitly building to scale and exit. Acquisition multiples. Team growth. A number they’d sell at.

The ecosystem clings to the “lifestyle business” myth: female founders as mission-driven do-gooders running purpose shops, unsuitable for serious cheques. Social impact ranks third at 28%, behind financial returns and scale/exit. 53% defined long-term success in straightforwardly financial terms.

38% are explicitly building to scale and exit. The assumption isn’t a harmless stereotype: it’s a capital allocation error repeated at scale, by professionals who claim expertise in pattern recognition and refuse to update their patterns when the data contradicts them.

Female-founded businesses outperform male-led ones by 35% on returns, yet get 2% of capital.

Then there’s the 21%: founders who dare mention work-life balance in their success definition, the stat trotted out as Exhibit A for “lower ambition.”

What they’re actually describing is a woman juggling caregiving, early-stage chaos, less capital, a “hard, long, degrading” fundraising gauntlet, and still refusing to let the business destroy her health or family.

The male founder who never mentions balance isn’t more driven. He’s just not doing the school run, elder care, or defending his parenting choices mid-pitch.

The game wasn’t built to penalise him for having a life outside the office. Calling that a character flaw in the women who do carry those responsibilities is lazy. Profiting from it, which the current system does, is something else.

The funding process: 72% negative, and rationally so

Among the 527 founders who had accessed private finance, 72% were negative about the experience. Among the 691 who had accessed public finance, 78% were negative. These are not the findings of a sector that has encountered a few difficult investors. They are near-consensus views from a sample five times larger than the threshold required for statistical confidence.

72% negative. In any other consumer context, that score would prompt an urgent review. In UK venture capital it prompts a voluntary code.

The private finance breakdown is instructive. A quarter found it complex and time-consuming in ways that pulled them away from running their businesses. One in ten experienced negative investor behaviour: ghosting, dismissiveness, power imbalances, overt sexism. 9% described fundamental misalignment between what investors want and the reality of their businesses.

“Hard, long, degrading.”

“Having to pitch your idea to a room full of men can feel daunting. I’d rather get my business off the ground without this type of funding if possible, as many investors I’ve spoken to so far seem to treat it like a game.”

“The current climate feels like people want to help out the known quantities, not the start-up that could be doing something really innovative and exciting.”

The known quantities problem is the one that matters most here. 86% of angel investors are male. 85% of investment committee seats are occupied by men. Female investors are twice as likely to back women-led businesses.

The research on homophily in investment is not ambiguous: investors back founders who remind them of founders they have backed before, which means founders who look, sound, and network like them.

Capital gets allocated based on pattern recognition, where the patterns were set by people who do not look like the founders in this report. Female investors are twice as likely to back women-led businesses. The composition of decision-making has barely shifted in six years because nobody required it to.

The structural consequence: female founders are opting out of the fundraising process entirely, and rationally so. They pitch cold, get asked about childcare before revenue, receive contradictory feedback, and update their probability estimate accordingly. Fewer women attempt to raise. Investors record a smaller pipeline. The pipeline problem is partly manufactured by the process claiming to solve it.

The report records 5% noting that access is shaped by networks and warm introductions. 39% said peer and founder networks were their most valuable support. 32% pointed to mentorship and coaching.

The Women and Equalities Committee has confirmed: warm introductions remain the most reliable path to venture capital in the UK. No network means no introduction. No introduction means no meeting. The arithmetic is simple and the barriers are structural.

Public finance: 60 hours, 96% rejection, 81% male assessors

The public finance findings are more damaging than the private data, because this is money explicitly allocated to support businesses exactly like these.

78% negative. Nearly a third described processes as overly complex and bureaucratic. 29% highlighted accessibility and inclusivity barriers. 22% cited rejection rates so high and feedback so generic that the application process offered nothing useful, not even information that would help next time.

“I’ve intentionally avoided this as the process seems horrific with such poor percentage of success.”

“It required huge amounts of persistence, being made to feel small, inconsequential and patronised.”

The median time to complete Innovate UK’s Women in Innovation grant application in 2024 was 60 hours.

The rejection rate was 96%. 17% of applicants paid for professional bid-writing support to navigate a system theoretically designed for exactly the kind of early-stage founder who cannot afford one.

The assessors, per an FOI request nobody should have needed to file, were 81% male.

In 2024, Innovate UK received 1,452 applications to its Women in Innovation programme. More than half scored 70% or higher on its own criteria.

It funded 25 of them and left £2 million unspent. When challenged, it admitted it had “prioritised wrongly.” In 2023, 67% of all Innovate UK funding went to male recipients.

The government’s own innovation agency, running a programme specifically for female founders, left half the money on the table after receiving overwhelming demand from high-quality applicants.

The Rise Report’s founders did not need the FOI to know something was wrong. They had the rejection letters and the 60 hours they spent before receiving them.

A system working as designed, allocating public money according to the assumptions of the people doing the allocating: 81% male, assessing businesses built predominantly by women, in sectors those assessors described as unfamiliar territory.

The FOI request that surfaced this took months to file and shouldn’t have been necessary. The answer, when it came, surprised nobody who had been paying attention.

Childcare: The capital allocation problem nobody calls a capital allocation problem

UK female founders pour roughly three times more of their income into childcare than their Canadian counterparts do.

The Centre for Progressive Policy puts the annual gross value added lost to the UK economy at up to £38 billion: about 1% of GDP vanishing every year because talented women are forced to spend what should be start-up capital on nursery fees instead of product, team, or runway.

Every extra pound sunk into UK childcare is a pound ripped from reinvestment, from hitting match-funding thresholds on public grants, from compounding toward the traction that makes a business venture-fundable.

Office space gets expensed. Travel gets expensed. Networking dinners get expensed. The childcare that enables a founder to attend those dinners does not.

Then the EIS seven-year eligibility window slams shut right on cue: for the exact founders who’ve spent those years bootstrapping around school runs, sick days, and elder care.

They hit investment-readiness in year five or six, just as the tax-relief clock expires. The rules weren’t written with malice toward women in mind. They were written by people for whom childcare has never been anything but background noise.

24% of these founders started businesses because they needed flexibility around caregiving.

Entrepreneurship wasn’t their dream escape from employment; for many, it was the only survival hack left when rigid workplaces treated parenting as a personal failing.

Yet the same system that pushed them into founding then punishes them for it: grant assessors probe family commitments before revenue models, pitch rooms ask about childcare plans instead of unit economics, eligibility criteria quietly disqualify anyone whose trajectory includes gaps or slower scaling due to actual human responsibilities.

The founders spell it out plainly: “Childcare grants. This is such a huge barrier to women working in general, let alone being able to give themselves the runway to build a business.”

Britain keeps choosing to subsidise the status quo, expensive nurseries, inflexible tax rules, no expensing of care costs, while the £38 billion hole in GDP quietly widens and gets filed under personal lifestyle choices.

1 in 7 say loneliness is their biggest challenge. This is a business problem.

27% of respondents admitted grappling with loneliness, isolation, self-doubt, and burnout.

Around 1 in 7 named loneliness and isolation as the single biggest challenge of entrepreneurship, consistent from tiny start-ups to larger scale-ups. Size doesn’t insulate you; the isolation scales with the business.

“The founder’s journey can be profoundly isolating, and one is carrying an immense burden, including the weight of personal financial stress and the livelihoods of colleagues.”

We file this under “wellbeing” and nod sympathetically. It’s also a commercial disadvantage baked into the system. 39% said peer and founder networks were their most valuable support.

32% pointed to mentorship and coaching. The Women and Equalities Committee has confirmed: warm introductions remain the most reliable path to venture capital in the UK.

No network means no introduction. No introduction means no meeting. The arithmetic is simple and the barriers are structural.

Female founders aren’t randomly lonely. They’re systematically excluded: more likely building outside legacy founder cliques, more likely in sectors without established peer groups, more likely the only woman in the accelerator room or pitch deck circle.

The loneliness isn’t a side effect. It’s the internal tax on external gatekeeping. You can’t get the warm intro because you lack the network.

You lack the network because you entered entrepreneurship sideways, pushed out of employment that offered no flexibility or belonging.

Employment failed you first, so the ecosystem that claims to “support founders” starts you 500 steps behind.

Founders who actually accessed real peer networks and mentors report that this, not another confidence workshop, was what accelerated them.

Easier to keep prescribing “resilience” and “self-care” than to fund scaled, accessible communities that would dilute the incumbents’ advantage and force the doors open.

So we get more reports documenting the isolation, more platitudes about mental health, and zero meaningful investment in the infrastructure that would end it.

The loneliness isn’t accidental. It’s profitable. And until someone pays to dismantle it, the system will keep manufacturing it, at enormous cost to founders, businesses, and the economy.

They know exactly what they need. They have said so repeatedly.

The report asked point-blank: what do you actually need?

45% said access to funding.

22% said networking and community.

20% said mentorship.

16% said childcare support.

16% said addressing systemic bias.

Straightforward. No mystery.

“Public and private matched funds or guarantees that de-risk investment into female founders.”

“It’s important to recognise the literal barriers that exist as well as the societal ones. These are not the fault of women and don’t always require us to be more confident.”

“We need a really big shake-up to make women-led businesses more visible, and for the advice and ecosystem to be more diverse.”

That middle quote should be engraved on every empowerment programme, every pitching bootcamp, every initiative that pretends the problem is female founders lacking grit or polish.

These women aren’t under-confident. They’re hyper-aware of a rigged process that wasn’t built for them, produces predictably poor outcomes, and then asks them to fix it with more self-belief.

Treating perceived confidence as the cause rather than the symptom is not just analytically wrong after six years, multiple reports, and 436,000 words of raw testimony: it’s an insult to the diagnosis.

Even the peer advice reveals the rot. 27% lead with resilience: just keep going, brace yourself, expect the unfairness.

When the dominant wisdom circulating among experienced female founders is “the system will grind you down so toughen up,” these women have already navigated the maze with broken tools and are trying to equip the next cohort not to die trying.

The founders aren’t asking for miracles. They’re listing evidence-based interventions that would move the needle: de-risking capital, real networks, actual mentors, childcare that doesn’t bankrupt them, and honest confrontation with bias.

They’ve said it repeatedly, patiently, in exhaustive detail. Yet the response remains the same: more workshops to “fix” women, more voluntary codes nobody enforces, more reports to document the failure.

Refusing to act on what they’ve spelled out, at this stage, is contempt for their time, their businesses, and the £310 billion sitting untouched because the people in charge prefer the comfort of the status quo.

Scotland: A case study in how little changes when you add political will

Scotland has a Chief Entrepreneur. It has the Pathways Report, the Pathways Forward initiative, a Scottish Government commitment to implementation, and the ScaleUp Institute’s Female Founders Scottish ScaleUp Index tracking progress annually. By the standards of institutional attention to female entrepreneurship, Scotland is doing more than most.

The 2026 Index found 139 visible scaling female-founded businesses generating £1.5 billion in revenues and employing 16,468 people. An 81% increase in the number of scaling female-founded businesses in a single year, almost twice the national rate. The foreword calls it real progress. It is, in the narrow sense that the number went up.

It is also 19% of all visible scaling businesses in Scotland. Total equity investment in Scottish female scaling firms has reached £116.5 million, an 80% increase on last year, concentrated in approximately 20 businesses.

That is one in seven of the 139. The other six are bootstrapping and using traditional working capital. The investment is growing. It is reaching a small fraction of the businesses that need it, in a country that has made female entrepreneurship an explicit policy priority and appointed a Chief Entrepreneur to drive it.

8 in 10 Scottish female-founded scaling businesses say there is little meaningful support available for businesses like theirs. Only 4 in 10 male-led businesses say the same. Scotland has more institutional infrastructure for female founders than almost anywhere else in the UK. 8 in 10 of those founders still feel unsupported.

That is not a communications problem. It is an accurate assessment of the gap between what the institutions say they are doing and what founders are actually receiving.

The finance picture in Scotland mirrors the national one with the addition of geographic isolation. 65% of Scottish female founders perceive most funding to be in London and the South East.

They are right. BGF and Par Equity lead in the number of growth equity investments into Scottish female scaling firms.

The investment committee composition that drives those decisions reflects the same demographics documented nationally: predominantly male, predominantly networked through channels female founders are less likely to access, predisposed toward sectors and business models that female founders are underrepresented in.

What the Scottish data adds, and what tends to get diplomatically omitted from reports produced by organisations embedded in the Scottish entrepreneurial ecosystem, is the women-against-women dimension. Scotland’s female founder investment landscape is not simply a story of male gatekeepers excluding women.

It is also a story of a small number of female-founded businesses capturing the majority of available investment while the broader cohort remains structurally excluded.

The £116.5 million is concentrated in roughly 20 firms. The remaining 119 scaling female-founded businesses are watching the same capital flow past them that their male counterparts have always watched flow past them, with the added experience of being told that female entrepreneurship is now a priority.

The angel investment data makes this concrete. Investing Women is among the funders listed. Female-led angel networks exist and are active. Yet the overall pattern of who gets funded and who does not reproduces the same concentrations visible in the national data.

Having more women in the room making investment decisions has not, in the Scottish evidence, reliably translated into more women receiving investment.

It has translated into a different set of women making decisions about which female founders to back, operating within the same structural constraints, risk appetites, and sectoral preferences that shape investment decisions everywhere else.

The barriers Scottish founders name are the same as those in the Rise Report, reordered by geography.

Talent and leadership development is the top barrier at 70%. Access to markets is second at 59%.

Finance is third at 37%, which looks lower than you might expect until you read the detail: 56% say it is difficult to raise from UK investors versus international counterparts, and the specific barriers they name are short-termism, lack of specialist funds, and inability to find a UK lead investor.

These are not different problems from the ones documented in the Rise Report. They are the same problems encountered by founders who are also 500 miles from most of the people who could solve them.

Scotland is, by the standards of this policy area, a best-case scenario. It has political commitment, dedicated infrastructure, improving data, and some genuine momentum.

It still has 8 in 10 female-founded scaling businesses feeling unsupported, investment concentrated in a fraction of eligible firms, and a support ecosystem that is visibly working better for some women than others in ways that the published data does not fully interrogate.

Faster progress toward an inadequate destination is still an inadequate destination. Scotland has just made the inadequacy more visible by trying harder than most.

The numbers behind everything

2% of UK venture capital goes to fully female-founded teams. Female-led businesses deliver 35% higher returns.

Closing the full gender gap in entrepreneurship could add £310 billion to the economy: roughly 13% of GDP.

The £635 million Invest in Women Taskforce pool is 0.2% of that prize.

The government’s £16 billion Industrial Strategy mentioned female entrepreneurship zero times.

Canada’s dedicated women’s entrepreneurship strategy is worth £3.7 billion: 37 times the UK’s commitment.

The UK trails Israel, Germany, Taiwan, Switzerland, Australia, Canada, New Zealand, and the United States on female entrepreneurial activity.

Not just behind: sliding backwards while peers pull ahead.

The Women and Equalities Committee laid out the fixes in October 2025. The government has not formally responded.

Voluntary failure is cost-free. Awareness campaigns cost nothing but time. Warm words from chairs and taskforces generate headlines without touching power structures.

Mandatory targets, penalties, ring-fencing, quotas: those cost the gatekeepers something: influence, comfort, the ability to keep allocating capital to “known quantities” without scrutiny.

Six years of reports, three major inquiries, 436,000 words from the people actually building the businesses, and silence from the top. A deliberate, repeated choice to leave billions in growth unrealised rather than disrupt the structures that benefit from the status quo.

What can be done: The founders have already told us: now it’s time to act

The 2,225 founders didn’t just diagnose the problems in 436,000 words: they prescribed the fixes. Point-blank, unprompted, they named what would move the needle:

• 45% demanded better access to funding: simpler, less degrading processes; matched funds or guarantees to de-risk investment into female-led ventures; removal of the seven-year EIS age limit that punishes bootstrapped, caregiving trajectories.

• 22% called for real networking and community: events and introductions that fit around childcare, not the other way around; peer groups built on lived experience rather than legacy cliques.

• 20% wanted targeted mentorship and coaching: from people who’ve navigated the same barriers, not generic “empowerment” platitudes.

• 16% highlighted childcare support as infrastructure, not a perk: grants, expensing eligibility, or subsidies to stop draining startup capital into nurseries.

• 16% insisted on confronting systemic bias head-on: mandatory gender-split reporting for VC portfolios, diverse assessors, and an end to “confidence” fixes that blame women for a rigged game.

These aren’t wishlist items. They’re evidence-based, low-hanging interventions the founders repeated across open responses.

The Women and Equalities Committee echoed them in October 2025 with 26 concrete recommendations: a dedicated Female Entrepreneurship Strategy overseen by a new ministerial office; mandatory FCA gender reporting with penalties; British Business Bank targets (2% to 10% equity for female founders by 2030, 30%+ ring-fencing); a Female Enterprise Investment Scheme with enhanced tax reliefs; 10% public procurement quota for female-led businesses; nationwide mentorship/sponsorship programmes; targeted accelerators in underrepresented sectors; and a role-model campaign to fix the “can’t name one” visibility gap.

The government responded in January 2026: they “do not rule out” future intervention if voluntary measures fail, welcomed the ambition, and pointed to the £635m Invest in Women pool and British Business Bank plans.

But no new strategy, no dedicated minister, no penalties, no firm timelines. No mention in the Spring Statement.

Voluntary codes continue; warm words persist.

The founders’ asks align with international benchmarks: Canada’s £3.7bn Women’s Entrepreneurship Strategy, US Office of Women’s Business Ownership: yet the UK clings to half-measures while trailing peers and sliding backwards.

The UK has warm words and a waiting brief. The testimony demands action. The recommendations exist. What remains is the choice: implement them, or commission Report #5 in 2031 to confirm, yet again, that nothing changed.

What the Rise Report is, and what it is not

The Rise Report is not a macro analysis of the funding gap. The WEC report does that work. What the Rise Report is, and what makes it genuinely valuable, is a record of what 2,225 women said when given the space to say it without a list of pre-approved options to choose from.

It is the texture behind the statistics. The founder who calls the process “hard, long, degrading.” The 1 in 7 for whom loneliness is the defining experience of building a business.

The 53% who define success in commercial terms and then encounter a system that has pre-decided they are running a lifestyle venture. The 10% who were made redundant and built something anyway.

The founders who spent 60 hours on a grant application, received a form rejection, and did it again the following year because the alternative was not doing it at all.

And it goes deeper: eight out of ten young people cannot name a single female entrepreneur.

The system is not merely failing current founders. By keeping successful women invisible, it is actively ensuring the next generation cannot even imagine themselves in that role: perpetuating the pipeline myth while starving aspiration at the source.

Britain has now produced enough reports to wallpaper a reasonably sized boardroom. The question is no longer whether anyone knows what the problem is. It is whether anyone in a position to fix it will choose to, or whether they will commission another report to confirm they haven’t.

The founders wrote 436,000 words. They were patient, specific, and generous with their time. The least the system can do is stop making them say it again in five years.

A bit later today, but here we are. The days are starting to get brighter, Spring is on the horizon and with it, some important conversations worth having.

£310bn. That’s what the UK Government’s Women and Equalities Committee estimated in October the lack of support for female founders is costing the UK economy. Adjusted for inflation, that’s around 13% of Britain’s GDP, a lifeline that could supercharge our sputtering economy.

On Friday, Female Founders Rise released its Rise Report on female entrepreneurship, and we’ll be dropping a deep dive with full analysis shortly. The highlights revealed that human connection has played an important role in the journeys of many female innovators, with 39% stating that peer support was crucial.

Yet the report raises familiar concerns: structural barriers in finance, funding, and support continue to impede the growth of female-led businesses.

From my reading of the Rise Report, not much has changed. Despite serious recommendations from the committee and despite the urgency of the economic case, progress remains slow. The question isn’t just why; it’s what we’re each willing to do about it.

If the October report sounded the alarm, the Rise Report shows what that alarm looks like on the ground.

Our report on the committee’s findings is linked below, and it’s worth your time.

The Essentials

Rates relief confirmed but demand weakness persists

The final settlement on Non-Domestic Rates relief brings meaningful, extended support for retail, hospitality, and leisure.

From April 2026, premises with a rateable value under £100,000 receive 15% relief, rising to 40% combined for licensed venues and pubs. Remote and island properties qualify for 100% relief.

The measures run through to March 2029, with an estimated £9m revenue impact in year one scaling to £17m by 2028-29. Businesses should contact their local council now to confirm eligibility.

Sentiment is improving, but unevenly

The Bank of Scotland Business Barometer shows confidence up 4 points to 41%, with economy optimism jumping 20 points. Yet demand for goods and services is falling for 13.5% of firms, and fewer than one in five plan price increases in March. The picture is one of cautious optimism rather than recovery.

Distress signals remain elevated

Q4 2025 saw 3,517 businesses enter critical distress, up 49.5% year-on-year, outpacing the UK average. Leisure, hotels, and bars are bearing the sharpest increases. Reliefs will slow the pressure; they won’t reverse it. Consumer-facing businesses should review cash flow now and seek advice early.

Growth signals worth watching

Not all the data points downward. More than half of mid-sized Scottish businesses plan to increase apprenticeship hiring this year, and 50% intend to introduce new technology: well above the UK average of 39%.

Scotland also leads the UK on sustainability ambition, with 73% of businesses planning to review their use of sustainable materials.

Meanwhile, a £50m investment in the Pentland Floating Offshore Wind Farm has been confirmed, with the Scottish National Investment Bank joining GB Energy and the National Wealth Fund.

For those thinking about scaling or investment strategy, there are nearly 2,000 Scottish firms in the £5m–£25m turnover band representing a significant pipeline for growth and M&A activity.

Watch Points

The pre-election sensitivity period runs March 26 to May 7: expect a six-week pause on funding decisions and approvals. The Agri-Tourism Investment Scheme closes March 13. The UK Spring Statement lands March 3.

A Note on Public Investment Discipline

Wales provides the case study. Scotland should ask the question.

The collapse of Calon Cardio-Technology, examined this week by Professor Dylan Jones-Evans, is a cautionary tale that reaches beyond Cardiff.

In Wales, the Development Bank’s attempt to distance itself from its predecessor, Finance Wales, sits uncomfortably given the institutional continuity at the leadership level: the current Chief Executive led Finance Wales through its transition.

The pattern is familiar: a company moves from repeated fundraising and claims about commercial potential to insolvency, leaving creditors owed around £5.4m and £3.5m of public money almost certainly unrecoverable.

The lessons land closer to home than many would like to acknowledge.

The Scottish National Investment Bank has seen Orbex collapse into administration, taking £29.3m with it, Trojan Energy go bust, leaving taxpayers £28m in the red, M Squared Laser fall into administration with a £34m loss, and satellite firm Krucial enter insolvency at a further £4.6m.

On top of those losses, the bank has carried £77m in earlier unrealised losses on failed projects.

The Scottish Government’s response has largely been to restate that risk is inherent in development banking, which is true, but insufficient.

Risk is not the problem. Risk without discipline is.

The real questions are whether warning signs were recognised early enough, whether public capital was tied to hard commercial milestones, and whether anyone moved decisively once the original investment case began to weaken.

The pattern of losses across 2025 makes clear that long-identified governance gaps and misaligned incentives were never adequately addressed and that the problems have intensified rather than stabilised.

The SNIB’s statutory five-year review is imminent. It should result in tighter milestone funding conditions, harder portfolio discipline, and a clearer framework for when to protect capital rather than defend the original narrative.

Celebrating deals at the announcement while quietly absorbing losses is not a credible position for any institution managing public money.

Professor Jones-Evans's analysis has been on Calon, which is linked at the start, and it is worth asking how much of it applies here.

Deals and Funding News

OrtoPed | Metacarpal — Distribution Agreement Montreal-based OrtoPed has signed an exclusive Canadian distribution deal with Edinburgh based Metacarpal’s GEM Hand, a multi-articulating body-powered prosthetic that replicates bionic grip functionality without batteries or electronics. OrtoPed will provide technical training and clinical support to Canadian prosthetists ordering the device.

Quantcore — £2.5M Seed Round University of Glasgow spin-out Quantcore has raised £2.5 million in a round co-led by PXN Ventures, Blackfinch Ventures and Scottish Enterprise, with Quantum Exponential and STAC also participating.

The company, the UK’s only manufacturer of niobium-based quantum components, will use the funding to scale its team from four to 12 and grow its superconducting processor and sensor manufacturing capability at Glasgow’s James Watt Nanofabrication Centre.

Kelvin Properties — £18.8M Development Finance Kelvin Properties has secured £18.8 million from Bank of Scotland to fund a 134-studio student accommodation scheme on Queen Margaret Drive in Glasgow’s West End, targeting completion in June 2027.

The development will be operated by True Student and is set to become the first purpose-built student accommodation to achieve gold accreditation under the NextGeneration Project sustainability framework, targeting a 70% carbon reduction.

Events and Opportunities:

For Founders

• Women on Top - International Women’s Day edition - Edinburgh, 5th March, Aberdeen, 11th March, Dundee, 12th March. Book Here:

• Female Founders Glasgow Meetup, 17th March, 6pm-8:30pm: First-ever Glasgow meetup for female founders at Barclays Eagle Labs, a relaxed evening of connection, support and community whether you’re just starting out or scaling up. Hosted in partnership with Barclays Eagle Labs, Dechomai, Glasgow Girls Club and AccelerateHER. Spaces are limited. Request to join here

• A series of events celebrating sustainability at Adam Smith Business School and the wider community 16 - 20 March.

• ClimbTour - Edinburgh, 22nd Apr: Launch tour event in Edinburgh, in partnership with Wilson Sonsini Private Dining Experience - Book here.

ClimbTour - Glasgow, 23rd Apr: Launch tour event in Glasgow, in partnership with Wilson Sonsini Private Dining Experience - Book here.

It’s been a week. The world feels like it’s hitting several crescendos at once, so if you need a distraction - I’ve got one.

The Burnout Files has officially launched. The first episode features Colin Frame, founder at Stellar Omada, and the response so far has been genuinely overwhelming. You can find it wherever you watch or listen to podcasts, including YouTube at the bottom of this article. I hope it resonates.

I’ve also quietly launched a second newsletter, separate for brand reasons, and I’ll attach a link for anyone who wants to be in both camps.

Closer to home, the Scottish Budget passed with the Lib Dems loudly declaring victory on a raft of concessions, conveniently timed ahead of May’s Holyrood election. More on that below.

The Essentials

Scottish Budget 2026-27: The latest

The Scottish Budget passed just in time for the May election. The enhanced 40% non-domestic rates relief for licensed hospitality and music venues is set to take effect from April 2026.

The Scottish Liberal Democrats secured around £300 million in additional funding and concessions in exchange for their support.

The headline wins: licensed hospitality venues, pubs, restaurants, hotels and music venues get 40% total relief (15% base RHL relief plus an additional 25%), capped at £110,000 per business per year, running 2026-29.

Self-catering accommodation gets transitional relief to cushion revaluation-driven bill increases.

Beyond business rates, the deal secured £20 million extra for the Real Living Wage in adult social care and childcare, up to £9.4 million for hospice pay parity with NHS Agenda for Change, £5.53 million to extend the Investing in Communities Fund for one more year, £4.3 million for a ScotRail fare freeze in 2026-27, a 10% increase in college payments, and additional funding for autism and ADHD services.

What does it actually mean for your business?

The 40% relief is a genuine win for licensed hospitality but it doesn’t apply universally, and with property revaluations pushing up rateable values, some businesses will still pay more in April than they did last year.

The National Living Wage rise to £12.71 adds further pressure on anyone with a large front-line workforce.

The businesses best placed to navigate 2026 are those who’ve already restructured their cost base. Those who haven’t are facing a difficult few months before any relief kicks in.

Investment is still flowing into Scotland’s tech and life sciences sectors, which tells its own story about where confidence actually sits right now.

Economic outlook: The Scottish Government’s February Economic Bulletin reports stable but subdued growth, with GDP growing modestly in late 2025 and business activity stabilising in January after a tough Q4. Scottish GDP is forecast to grow 1.3% in 2026, supported by lower inflation and looser monetary policy, though global trade uncertainty and supply chain risks pose headwinds.

Business confidence is sending mixed signals: KPMG’s Private Enterprise Barometer found 87% of Scottish private business owners confident about 2026 growth, while Fraser of Allander Institute data shows nearly 80% of firms reporting higher costs recently, with 90% expecting further rises in H1 2026. ICAS accountants are less optimistic, only 6% expressed confidence in the economy’s health post-Budget.

Insolvencies and Sector Pressures January 2026 saw 74 company insolvencies in Scotland, down 1% year-on-year, though retail, wholesale and hospitality continue to account for a disproportionate share of cases. UK-wide hospitality insolvencies hit 3,353 in 2025. Subdued consumer spending, thin margins and persistent cost pressures mean further challenges are expected despite the Budget’s targeted relief.

Labour and Wage Costs The National Living Wage rises to £12.71 per hour from April 2026, up 4.1% from £12.21 adding to labour cost burdens particularly in hospitality and retail. The voluntary Real Living Wage sits higher at £13.45, and some employers may face pressure to align.

Other Developments Council tax rises are proposed across many local authorities for 2026-27, with Glasgow, Edinburgh and Fife looking at increases of 5–8%, which could indirectly dampen consumer spending. IFS analysis highlights slowing funding growth ahead, with resource funding at around 1% real-terms annual growth to 2028-29. Investment continues flowing into AI, biotech, climate tech and subscription businesses, with some pension funds committing to social investment funds.

Deals and Funding News

Glasgow developer secures £18.8M for 134-studio West End student housing scheme — Kelvin Properties has secured £18.8 million from Bank of Scotland for a 134-studio student development on Queen Margaret Drive, targeting completion June 2027. The scheme will be the first purpose-built student accommodation to achieve gold accreditation under the NextGeneration sustainability framework. CCG is main contractor, with True Student operating on completion. Glasgow City Council has flagged a shortfall of over 6,000 student beds.

Transocean reports $4B revenue for 2025, cuts debt by $1.3B, announces Valaris merger — Transocean posted full-year 2025 revenues of $3.965 billion, up 13%, with adjusted EBITDA up 19% to $1.37 billion and free cash flow of $626 million. Total debt fell $1.258 billion to $5.686 billion. A merger with Valaris has been announced, with 2026 revenues forecast at $3.8–3.95 billion.

Jointly AI launches world’s first autonomous AI insurance broker platform — Edinburgh-based Jointly AI has launched what it claims is the world’s first fully autonomous AI insurance brokerage platform, using voice AI to call insurers, negotiate quotes and deliver recommendations within 35–45 minutes. Available now via subscription in early access.

Lario Therapeutics receives $2.4M from Michael J. Fox Foundation and Wellcome — Edinburgh-based Lario Therapeutics has received $2.4 million to expand its neuronal calcium channel drug discovery platform, targeting Parkinson’s disease and PTSD. IND-enabling studies are planned for 2026.

Innermedia merges with Glasgow’s Blue Sword to expand AI-driven marketing capabilities — Digital agency Innermedia has merged with Glasgow-based Blue Sword Ltd, combining performance-led digital marketing with 25 years of web development and AI innovation to serve clients across the UK.

Scottish water tech firm Cascade secures £350K to scale greywater recycling system — Dundee-based Cascade Water Products has secured up to £350,000 to commercialise its micro-greywater recycling system, which reduces domestic water consumption by up to 45% by reusing shower and bath water for toilet flushing.

UK government reportedly blocks The Exploration Company’s acquisition of Orbex — The Exploration Company has suggested the UK government blocked its acquisition of launch startup Orbex, which subsequently filed for insolvency. Skyrora has expressed interest in select Orbex assets including Sutherland Spaceport, with plans to invest up to £10 million.

Carbogenics closes $3M round to scale carbon removal biochar technology — Edinburgh-based Carbogenics has closed a $3 million round to scale its CreChar biochar technology, with funding from Dangerous Ventures, Green Angel Ventures, Scottish Enterprise and Old College Capital, alongside Innovate UK grants.

Japanese chemical firm Zeon invests in Glasgow’s Chemify to speed up material research by 90% — Zeon Corporation has made a strategic investment in Glasgow-based Chemify, whose automated AI laboratory reduces concept-to-compound research time by over 90%.

Higgs LLP completes first acquisition since August Equity backing, buys Scottish firm Vialex — West Midlands law firm Higgs LLP has acquired Scottish legal group Vialex, establishing a new Edinburgh base. Higgs reported turnover of £22.8 million in accounts to November 2024, with operating profit of £6.7 million.

Blood test with 99.3% accuracy helps GPs triage brain cancer patients amid scan delays — Glasgow-based Dxcover has launched a UKCA-approved blood test for brain cancer early detection, delivering results within 24 hours. Evidence suggests a one-month improvement in diagnosis time could reduce mortality by 18–28%.

Events and Opportunities:

For Founders

• Egg Business Club’s Women on Top - Glasgow, 25th Feb, 10am-12:30pm: Morning of connection, conversation and inspiration at Maison by Glaschu, Princes Square. Featuring The Braid Sisters, Amanda and Martine, wellbeing coaches and authors of Notes From Your Sisters, sharing insights on resilience, mindset, and personal growth. Open to members and non-members. No dress code. Book here:

• Building a Winning Team Workshop - Edinburgh, 26th Feb (Startup Grind): Practical session on team-building for founders

• Founder Friday Co-working - Edinburgh, 27th Feb, 9am: Networking and coworking with fellow founders

• Bridging Financial Services Skills Gaps - Edinburgh, 24th Feb: Fintech-focused event with Heriot-Watt University and Scottish Financial Enterprise

• ProductTank Community Flash Talks - Edinburgh, 24th Feb, 5:30pm: Product folks share honest stories about what didn’t go to plan

• Women on Top - International Women’s Day edition - Edinburgh, 5th March, Aberdeen, 11th March, Dundee, 12th March. Book Here:

• Female Founders Glasgow Meetup, 17th March, 6pm-8:30pm: First-ever Glasgow meetup for female founders at Barclays Eagle Labs, a relaxed evening of connection, support and community whether you’re just starting out or scaling up.

• Hosted in partnership with Barclays Eagle Labs, Dechomai, Glasgow Girls Club and AccelerateHER. Spaces are limited. Request to join here

• ClimbTour - Edinburgh, 22nd Apr: Launch tour event in Edinburgh, in partnership with Wilson Sonsini Private Dining Experience - Book here.

• ClimbTour - Glasgow, 23rd Apr: Launch tour event in Glasgow, in partnership with Wilson Sonsini Private Dining Experience - Book here.

  Listen to it on your favourite location here: https://the-burnout-files.captivate.fm

• watch here on YouTube:

Germany is one of Scotland’s most important trading partners. Scotland has world-class AI research, space capability, and energy technology. Germany is Europe’s largest economy and a gateway to serious scale.

Our commercial links are thin. Our investment flows are limited. Our companies default to looking west, not east.

The Scotland-Germany collaboration event, organised with the British Chamber of Commerce in Germany, Glasgow Chamber of Commerce, Germany Trade and Invest, and the German Consulate in Edinburgh, on February 6 in Glasgow was supposed to address that gap. Instead, it revealed why the gap exists: we keep mistaking agreement for progress.

What followed was Scotland’s familiar pattern: thoughtful discussion, genuine insights, broad agreement and then everyone leaves.

This happens at every event about our innovation ecosystem. We convene brilliantly. We execute inconsistently. And we rarely confront that gap honestly.

Opening with substance: Scotland’s and Germany’s commitment

The opening remarks from Minister Richard Lochhead set the tone. Germany is one of Europe’s largest economies, one of Scotland’s most important trading partners, and a country with which we share long standing cultural, academic and economic ties.

That is not in dispute.

When asked how Germany fits into Scotland’s broader international growth strategy, particularly around artificial intelligence and advanced technologies, the answer focused on familiar strengths. Clean energy collaboration. Space. Engineering. Deep technology.

All of that is true. But it also revealed something else.

We are very good at describing opportunities. We are less good at describing delivery.

There was acknowledgment that government support structures exist, that trade missions happen, that coordination is improving. There was also an admission that younger companies still struggle to navigate those structures, and that support is often fragmented or poorly communicated.

Christiane Hullmann, Consul General for Scotland, followed the remarks by emphasising the depth and durability of Scotland-Germany ties. These are not new relationships, she noted, but longstanding connections rooted in shared cultural and academic values.

What made her remarks valuable was the grounding in reality. Germany sees Scotland as a strategic partner across multiple domains: clean energy transition, space technology, advanced engineering, and deep technology development. These are not aspirational talking points. They reflect active bilateral work already underway, built on decades of collaboration.

The Consul General’s presence was not ceremonial. It signalled serious institutional commitment from the German government to strengthening these ties. That matters, because it means infrastructure exists on the German side to support deeper engagement. The question, as the day would reveal, is whether Scotland has matching infrastructure to convert that institutional support into commercial outcomes.

If you spend any time working in Scotland’s start-up and innovation ecosystem, a pattern becomes impossible to ignore.

Berlin is not Germany, and Germany is not one market

One of the most practically useful parts of the discussion came early, when the conversation moved to Berlin and Germany’s decentralised economy.

Stephanie Richter, who built and scaled her company, Adspert GmbH, in Berlin, was refreshingly honest. Berlin is international. You can operate entirely in English. It attracts talent from across the world. It has energy, density and visibility. But it is also largely a software city. If you are building deeper technology, engineering driven products or industrial innovation, Berlin may not be the right place.

That matters.

Because too often Scotland talks about Germany as if it were a single market, or worse, as if Berlin were a proxy for the whole country. Germany is a federation of sixteen states, each with different strengths, industries, funding instruments and ecosystems.

Rob Scheid from Germany Trade and Invest reinforced this point clearly. There is no single right answer to where a company should go. It depends on priorities. It depends on sector. It depends on ambition. And that complexity is not a barrier, it is a feature.

Germany’s decentralised model means opportunity is spread. It also means you have to do your homework.

Mobility and connectivity matter. Being present matters. Knowing which region does what matters. This is not a market you wing your way into.

Culture fit is not enough

Several speakers touched on cultural compatibility between Scotland and Germany, and they were not wrong.

Both tend towards humility. Both are more reserved than their American counterparts. One speaker noted that Scots, like Germans, often talk themselves down rather than up.

But cultural fit does not equal commercial success.

Adam Hill, founder of Stierlink Ventures GmbH, articulated this well when he spoke about the five Ps that matter in Germany. Preparation. Presence. Process. Patience. Proof.

German companies prepare deeply. They expect clarity on objectives. They value process and evidence. They reward consistency over time. Relationships are built by showing up repeatedly and meaningfully.

This is where many Scottish companies stumble. Not because they lack capability, but because they underestimate what serious engagement requires.

Turning up once is not presence. Sending a deck is not preparation. Talking about ambition is not proof.

Trust is the real currency, and it got harder

One theme came up again and again, sometimes explicitly and sometimes between the lines. Trust.

Winning the first German customer is hard. Winning the second and third becomes easier, because references matter. Logos matter. Reputation matters.

Adam Hill put it bluntly. Germany is often the hardest place to win your first customer, but one of the easiest to grow once trust is established.

Brexit made this harder. Several speakers acknowledged that regulatory friction, legal uncertainty and loss of automatic trust have slowed collaboration. In areas like quantum, defence, climate and deep tech, trust is not abstract. It is contractual, legal and operational.

German buyers want to know who they are contracting with, under which jurisdiction, and how issues will be resolved when things go wrong. Local presence is not optional in many cases; it is reassurance.

This is where Scotland often over romanticises international expansion. We talk about markets. German companies talk about risk.

Capital is not the only bottleneck, capability is

There was a useful reframing around investment that deserves more attention.

Yes, capital matters. But several speakers emphasised that partnership, industrialisation expertise and access to manufacturing capability are often more valuable than money alone.

Jenny Patten, Head of Business Development at Bosch UK, described how it invests around eight percent of its turnover back into research and development, but more importantly, how it partners with start-ups to help them industrialise products and move up the maturity curve.

The example of working with a Scottish company to help take technology from an early stage into scalable manufacturing was not just a nice story. It highlighted exactly the type of partnership Scotland should be seeking more deliberately.

We talk constantly about funding gaps. We talk far less about capability gaps.

Scotland’s strengths are real, but we promote the wrong things

The second panel focused on what Scotland offers.

And to be clear, there is a lot.

Deep technical capability in space, energy, climate and data. Strong universities. Public funding mechanisms that take early risk. A workforce that is adaptable because, frankly, it has always had to be.

Angela Mathis, chief executive and co-founder of ThinkTank Math, and president of the Scottish Energy Forum, made a compelling case that Scotland has been forced to internationalise earlier than other parts of the UK because it lacks the same density of domestic customers. That necessity has created openness but lacks mindset.

Meanwhile, QuickBlock chief executive Andrew Vincent highlighted something important that often gets overlooked. Scottish companies can tap both UK wide and Scotland specific support structures. That dual access is genuinely attractive to international partners.

But here is the problem.

We often default to talking about lifestyle, place and quality of life as if those alone convert into scale.

They do not. They attract talent. They support retention. They help with recruitment. But they are not strategies for building globally competitive companies.

The most honest moment of the day

Late in the discussion, Paul Wilson said something that should have landed harder than it did.

If you ask one hundred people in Scotland what their first international market should be, most will say the United States. Not because it is always the best option, but because it is the default advice.

That default has become lazy.

Germany, and Europe more broadly, can be a far better first expansion step for many Scottish companies. Same time zone. Cultural alignment. Large sophisticated buyers.

Strong industrial base. Serious capital.

But it takes more work. More planning. More patience.

And then came the line that should have framed the entire event. If we want this to change, we need to take action. Not more agreements. Not more panels. Action.

Scotland loves events more than outcomes

Here is the uncomfortable truth.

Scotland is excellent at convening. Scotland is inconsistent at execution.

We fill rooms. We host thoughtful discussions. We generate momentum. We publish optimistic reports.

Then we leave and default to old patterns.

This is not because people don’t care or are complacent. It is because the ecosystem rewards activity over delivery. Visibility over accountability. Consensus over decision making. Quantity over quality.

The result is a culture where saying the right thing feels like progress, even when nothing structurally changes.

The Scotland problem: two extremes and the uncomfortable middle

On one side, there are the chronic pessimists. Everything is broken. Nothing works. It is all red tape, risk aversion and small thinking.

On the other side, there are the relentless optimists. Scotland is world class. The ecosystem is thriving. We are punching above our weight. Everything is moving in the right direction.

Both camps are loud. Both camps are rewarded with attention. And both camps are deeply unhelpful.

Because the truth lives in the middle. And the people who live there tend to get talked over.

That middle position says Scotland genuinely has world class capability in certain domains.

It also says we have structural weaknesses that we refuse to confront honestly. It says celebration without execution is just comfort. It says critique without responsibility is just noise.

The event was full of goodwill, intelligence and experience. But it also revealed just how uncomfortable many still are sitting in that middle space where praise and pressure coexist.

What action actually looks like

If Scotland Germany collaboration is to become more than a theme, it needs to shift from aspiration to infrastructure and to action.

That means clarity on routes to market.
That means defined pathways for partnerships, customers and capital.
That means fewer delegations and programmes, less waste and more structured bilateral work with ownership and timelines.
That means selecting and preparing companies properly before sending them into complex markets.
That means being honest about readiness, not just ambition.

Less, but meaningful, is more.

And crucially, it means protecting, taking care and listening the people who sit in the middle. The ones who believe Scotland is strong but unfinished, who celebrate success without denying friction, who want to build, not posture.

But what does that look like in practice?

The panelists provided the ingredients; Bosch's partnership model with Captana, the Digital Hub network, calls for bilateral action. But ingredients aren't recipes. Here are some concrete examples of what structured action could look like:

1. Sector-specific matching programmes with defined outcomes

Not general networking events, but structured pilot partnerships between Scottish companies and specific German industrial partners or regional hubs. Bosch already does this with Scottish companies like Captana Technologies. The model exists. Scale it. Run quarterly cohorts pairing Scottish space companies with Munich’s aerospace cluster, or Scottish AI firms with Stuttgart’s automotive ecosystem. Make it bilateral. Measure it. Report outcomes publicly. The good and the not too good.

2. A Scotland-Germany market readiness assessment tool

Before Scottish companies engage with Germany, they need honest feedback on whether they are ready. Build a diagnostic that assesses preparation, presence capability, process maturity, and proof of concept strength. Not a tick-box exercise, but a frank conversation about gaps. Pair it with targeted support to close those gaps. This stops companies wasting time and credibility by entering markets underprepared.

3. Strengthen and focus commercial support in German regions

Scotland and the UK has offices in Germany through SDI and UK government trade support. On paper, they cover regions and sectors. In practice, Scottish companies still struggle to navigate German ecosystems, find the right industrial partners, or understand which regional hub matches their technology. Germany Trade and Invest embeds people in Scotland who actively connect German companies to opportunities. Scotland needs equivalent intensity: not just presence, but proactive support that opens doors to Bavaria's aerospace cluster, North Rhine-Westphalia's industrial base, or the Digital Hub network. Measure success by partnerships formed and revenue generated, not reports written, number of meetings or events attended.

4. Joint Scottish-German funding instruments for bilateral R&D

Bilateral innovation often stalls because funding mechanisms are national. Create co-investment structures where Scottish and German agencies jointly fund collaborative projects in climate tech, quantum, space, or energy. This de-risks cross-border partnerships and forces institutional coordination. Start small. Three pilot projects. Learn. Iterate.

5. An annual Scotland-Germany commercialisation scorecard

Track what matters. How many Scottish companies entered German markets? How many German companies invested in or partnered with Scottish firms? What revenue did those partnerships generate? How many jobs were created? Publish it. Make the data public. Celebrate successes. Acknowledge failures. Use it to inform what works and what does not. No spin. Just facts.

These are not revolutionary ideas, and can be applied in different cases, not only in the Scotland-Germany opportunity. They are practical, fundable, and measurable.

My takeaway

I left the event with two simultaneous feelings.

Optimism, because the Scotland Germany opportunity is real, underused and well matched.

The intent in the room was genuine. The insights shared were valuable.

Frustration, because Scotland keeps circling the same conclusions without committing to the hard work of follow through.

We need fewer events and more delivery. Quality over Quantity

If this event becomes the start of concrete, owned, resourced pathways between Scotland and Germany, it will matter.

If it becomes another well meaning moment that dissolves once the coffee is finished, it will simply confirm the pattern.

And Scotland deserves better than that.

Caro Melendez is Founding Partner of Foras Ventures. She has spent a decade working across Scotland and UK’s innovation ecosystem, identifying and supporting high-growth start-ups, building scalable international programmes and designing cross border market access initiatives. Experienced operating across the armed forces, private sector, venture ecosystems and governments, with a strong focus on internationalisation, strategic partnerships and ecosystem integration and built a 15,000+ vetted global network of founders, investors, operators and start-up ecosystem leaders across the UK, EU, US and beyond. She believes Scotland and the UK convenes brilliantly but executes inconsistently, and she's working to close that gap.

It’s important to remember the important things in life and take time to enjoy what we have around us.

Today, Walter Carlton will run the Innocent Half Marathon in Edinburgh raising money for Scottish Action for Mental Health (SAMH) in memory of Alison Gibbens, who tragically passed away after she went missing on January 26. She is the wife of Accountech founder, Stephen Gibbens, who requested donations be made to help the charity, which provides mental health social care support, addictions and employment services, across over 70 communities in Scotland.

So far Stephen has raised £18,686.54 with Walter raising £1,756.25, bringing the total to £20,442.79. For those wanting to donate: https://www.justgiving.com/page/walter-carlton-3?utm_source=CL&utm_medium=DT. Our thoughts are with Stephen, his family, and all affected during this difficult time.

On a different note, the first few episodes of The Burnout Files will be released soon. Snippets of my conversations with Colin Frame of Stellar Omada, Danny Campbell of Hoko, Tony Crolla of Vittoria and Mark-Paul Buckingham of Reactec are now ready to go, with the release imminent.

This week I spoke to Sanjeev Sanghera of Doner Shack and Alice Thompson-Boyd, co-founder of Social Bites and now a enneagram facilitator and purpose coach. It’s shaping up to be an exciting series with lots of nuggets to learn from for everyone on the journey.

Meanwhile, I attended a Scottish Asian Business Chambers event with the First Minister John Swinney. He failed to impress - though maybe that’s because he was taken aback by a public challenge when he was meant to be announcing something else entirely, which you can read here: Eighteen years of further conversation: Why Scotland’s entrepreneurs keep getting the same non-answer.

The Essentials

Scottish Budget 2026-27: What You Need to Know

The Scottish Budget is now being debated in Parliament, with a final vote expected in late February. Here’s what matters for businesses:

Business Rates (The Tax on Commercial Property):

The rates themselves have been reduced - basic rate down to 48.1p, intermediate to 53.5p, and higher to 54.8p. There’s also new relief for shops, restaurants, and hotels: properties valued up to £100,000 can get 15% off their bills (with a maximum £110,000 saving per business). This relief package is worth around £138 million over the next three years (2026-29). Remote and island businesses in places like Cape Wrath, Knoydart, and Scoraig keep their 100% relief.

The Problem:

Industry groups like UKHospitality Scotland and the Scottish Licensed Trade Association say this “underwhelming” 15% relief replaces the previous 40% hospitality discount. Meanwhile, property valuations have risen significantly in the 2026 revaluation. So despite the rate reductions, many businesses will still see their bills increase by thousands of pounds. They’re warning of job losses and closures ahead.

The Broader Challenges:

Labour costs remain the biggest barrier for businesses. Scotland’s unemployment sits at 3.7% (September-November 2025), below the UK average of 5.1%, but hiring costs and underemployment remain high.

Retail and hospitality are particularly hard hit - critical business distress is up 16.7% year-on-year in Q4 2025 (according to Begbies Traynor), with liquidations above pre-COVID levels. More are expected in 2026 as businesses face higher rates, rising wages (National Living Wage goes to £12.71 from April), and elevated energy costs. Between 72% and 86% of outlets expect declining sales or shrinking profits.

Investment:

Despite the pressures, investment continues flowing into Scottish AI infrastructure, biotech, climate technology, and subscription businesses - though investors remain cautious about late-cycle economic risks.

Deals and Funding News

UK Forces Chinese sale of British chipmaker

The UK government has ordered a Chinese private equity consortium to sell its controlling stake in Glasgow-based Future Technology Devices International (FTDI) by 7 February on national security grounds. FTDI designs and manufactures semiconductor devices used across multiple industries. The forced divestment is one of Britain’s most direct interventions in foreign tech ownership, reflecting growing Western concern over Chinese investment in strategic technology sectors.

Vodafone commits to retail staff despite store closures

Vodafone chief executive Margherita Della Valle has promised no forced redundancies of retail staff following the £16.5 billion acquisition of Three, even as duplicate stores close. The pledge comes as Vodafone lost 73,000 UK mobile customers in quarter four and missed German revenue targets (0.7% growth vs 1% expected). Total group revenue rose 6.5% to €10.5 billion. Shares fell 5.1% but remain up 60% over twelve months.

Smart Data Foundry wins £35,000 to fix Scotland’s festival accommodation crisis

Edinburgh’s Smart Data Foundry secured £35,000 from CivTech to build a festival planning platform integrating transport, accommodation and workforce data. Research shows over half of potential festival-goers struggle to find accommodation within a 90-minute commute due to limited late-night transport.

The company is one of twelve in CivTech’s accelerator with potential access to £7.7 million in public sector contracts. Tourism brought £4 billion into Scotland’s economy in 2024.

Turmeric start-up launches with $40m to solve absorption problem

Connecticut-based Turmeric Innovations launched in Georgia with $40 million to tackle turmeric’s bioavailability problem - standard supplements have less than 1% absorption. The company’s three product lines (beverages, lozenges, beadlets) use proprietary technology to increase absorption. The global curcumin market was $99 million in 2024, projected to reach $200 million by 2030.

Former Volvo and Dyson chief executive to chair Scotland’s £15m tech fund

STAC appointed Glasgow-born Jim Rowan (former CEO of Volvo Cars and Dyson) as chair as it launches a £15 million investment fund for Scottish startups in robotics, AI, quantum computing, photonics and manufacturing.

Rowan led Volvo to record profits in 2023-24 and was named Newsweek’s chief executive of the Year. Since 2021, STAC has supported 120 start-ups, facilitated £50 million in investment and created 400 jobs.

AI Platform tackles loneliness in senior living

Cogensus partnered with Insight Senior Living, Integrated Senior Foundation and Integrated Senior AI to deploy AI companionship tools across senior communities. The platform aims to combat loneliness-related cognitive decline while tracking outcomes through a research component. Early-access launches this month, with commercial rollout in Q2 2026.

Events and Opportunities:

For Founders

• Female Founder Coworking - Glasgow, 11th Feb, 9:30am: Supportive workspace for women entrepreneurs to focus and connect

• Founders Club - UWS Paisley Campus, 12th Feb: Founder-focused talk and networking with Paul McColgan

• Founders Meet-up - Glasgow, 12th Feb, 6pm: Creative and tech founders fireside chats and networking

• Founders Meet-up - Edinburgh, 17th Feb, 6pm: Featuring Robert Gelb and Mohamed Zamzam. Tactical chats and speed networking with founders, cofounders, investors.

• Digital Health and Care Conference: Feb 10-11 at Dynamic Earth, Edinburgh

• Building a Winning Team Workshop - Edinburgh, 26th Feb (Startup Grind): Practical session on team-building for founders

• Founder Friday Co-working - Edinburgh, 27th Feb, 9am: Networking and coworking with fellow founders

• Blockchain Scotland Meetup - Edinburgh, 12th Feb, 5pm: Talks and networking with web3 community, speakers from Xcavate and Ethereum Foundation (food and drinks included)

• Traveltech Meet Up - Edinburgh, 19th Feb, 5pm: Informal networking for travel tech founders

• Bridging Financial Services Skills Gaps - Edinburgh, 24th Feb: Fintech-focused event with Heriot-Watt University and Scottish Financial Enterprise

• ProductTank Community Flash Talks - Edinburgh, 24th Feb, 5:30pm: Product folks share honest stories about what didn’t go to plan

• Storytelling: Why It’s More Important Than Ever - Edinburgh, 17th Feb, 6:15pm: Using narrative to bring culture and strategy to life

• Employee Ownership Workshop - Online & Edinburgh, 19th Feb (Scottish Enterprise): Free/paid sessions on succession via employee ownership

Have a story tip or want to be featured? Reply to this email or contact me on LinkedIn.

“Minority ethnic businesses.” The phrase appeared everywhere: funding applications, government reports, strategy documents. It framed every conversation, shaped every policy, determined who got heard and who got ignored.

It also made success invisible. Hard to celebrate achievements when the language assumes you’re starting from deficit. Hard to attract investment when the framing is about problems, not potential.

On Monday night with the First Minister in the room, Ashraf was going to challenge him directly at the RBS Accelerator in Glasgow.

The evening began with the usual formalities. Speeches about Scotland’s entrepreneurial spirit. Celebrations of diversity. Commitments to inclusion.

Ashraf’s turn came. He talked about generational thinking, about preserving what their fathers built rather than squandering it on lavish lifestyles. About legacy over short-term gain. About building businesses that would outlast them.

Then he pivoted.

The language barrier, he explained, wasn’t about translation. It was about framing. About the difference between “minority ethnic” and “ethnically diverse.” One phrase centers marginalisation. The other centers contribution. One asks for help. The other offers value.

Scotland’s programs were built on the first framework. They needed to shift to the second.

He laid out two specific proposals: First, standardise “ethnically diverse” across all government and public bodies, working with the newly appointed chair of the Anti-Racism Observatory for Scotland. Second, let the Chamber lead dedicated engagement with Scotland’s economic development agencies, Scottish Enterprise, Skills Development Scotland, the lot ,to help with innovation.

Two concrete asks. Both achievable. Both within the First Minister’s power to greenlight.

Then came the challenge. Direct. Public. Impossible to dodge without everyone noticing.

Would the First Minister commit to working with the Scottish Asian Business Chamber on this?

Simple question. Public setting. The very community affected sitting right there.

Swinney stood: suited, prepared, ready to respond. Except he wasn’t ready.

First, he needed to explain why the Chamber was “fundamental.” Why he took that view. How that laid the foundation for what he was about to say. Then, despite being an experienced public speaker who knew how to project in a room, he checked whether everyone could hear him at the back.

“This is a welcome opportunity to engage in conversation,” he began.

Not “yes.” Not “here’s how we’ll do it.” An opportunity to engage in conversation.

What followed was a masterclass in running down the clock. The government’s economic development agenda. Universities as custodians of innovation. TechScaler. Scottish Edge. Investment summits. The Deputy First Minister’s recent trip to the UAE. Scotland’s track record on foreign direct investment.

What the achievements actually look like

To be fair to Swinney, the achievements he listed weren’t fabricated. Scotland genuinely has attracted significant investment. The programs he mentioned do exist and have had impact. The question is whether that impact justifies the claims or the cost.

Take TechScaler. Launched in 2022 with £42 million in public funding over five years, it has built genuine ecosystem value: thousands of members, mentorship programs, global trips for Scottish startups. Member companies have collectively raised £118 million. These are real outcomes.

Scottish Edge operates on a different model. Annual prize pots around £1.5 million, total disbursement of £30 million since 2013, a fraction of TechScaler’s budget. Yet the numbers are stark: 712 businesses supported, 4,400 jobs created, £763 million in aggregated company turnover. Independent evaluations show £7-8 in net economic value returned for every £1 of public funding invested.

Both programs work. The question isn’t whether TechScaler provides value, clearly it does. The question is whether £42 million in public funding produces better outcomes than the targeted, selective approach that costs a fraction and delivers measurable multiples.

It’s a question Swinney didn’t address, perhaps because the answer is uncomfortable.

The October investment summit provides another example. Over 100 global investors attended. £10 billion in commitments were announced, largely tied to green energy projects like Scottish Power’s grid rewiring pledge. By any measure, this was an impressive convening, the kind of event that demonstrates Scotland’s ability to attract serious attention.

Announced commitments, however, aren’t the same as delivered investment. They’re pledges subject to regulatory approval, market conditions, execution timelines, all factors that can delay or reshape outcomes over years.

Four months after the summit, no public reports detail how much of that £10 billion has actually materialised. The coverage remains enthusiastically positive on momentum and intent. The concrete outcomes, jobs created, capital actually invested, projects broken ground, aren’t yet available for independent verification.

Perhaps they will be. Perhaps in six months or a year, those numbers will vindicate the optimism.

But standing in front of the Scottish Asian Business Chamber reciting summit announcements as evidence of delivered results is, at minimum, premature. At maximum, it’s conflating headlines with outcomes.

And then there are the start-ups themselves. Scotland’s tech ecosystem has genuinely grown. That’s real progress, worthy of acknowledgment. What Swinney didn’t mention is what happens when those companies need serious growth capital.

Chemify, the Glasgow-based chemtech company, raised $50 million in Series B funding in 2025. Impressive. It also opened a Silicon Valley hub. Why? Because that’s where the deeper capital pools and greater risk appetite live. Not in Edinburgh. Not in Glasgow.

This isn’t unique to Scotland; it’s a UK-wide challenge. But it’s also the challenge Swinney’s recitation of achievements carefully avoided acknowledging. Scottish startups increasingly incorporate in Delaware to attract American VCs. The companies that succeed often do so by leaving, or at least by building their growth strategy around access to American capital markets.

The pattern is clear: Scotland attracts early-stage activity but loses late-stage companies to ecosystems with more patient capital and greater tolerance for risk. That’s not a failure of individual programs. It’s a structural problem that summit announcements and membership numbers don’t address.

None of this means Scotland isn’t making progress. Swinney was right to note that “other than London and the South East, our level of business start-ups and tech start-ups are outpacing many parts of Europe.” Scotland’s tech ecosystem has genuinely grown, capturing 12% of UK equity deals, up from 9%.

But here’s what that qualified claim reveals: even when comparing favorably, Scotland has to exclude London and the South East. And what happens when Scottish startups need serious growth capital? They go to those very places he’s excluding from the comparison.

The deal share growth is documented. The ecosystem development is measurable. But when your most cost-effective program operates on a fraction of your flagship initiative’s budget, when your investment summit pledges haven’t produced published outcomes four months later, when your successful startups raise growth rounds in Silicon Valley, the claim to be “the most attractive investment destination in Europe” starts to require significant qualification.

The kind of qualification Swinney didn’t provide when spending ten minutes reciting achievements instead of answering whether he’d commit to working with the Chamber on two simple proposals.

Perhaps the proposals weren’t ambitious enough. Perhaps changing language from “minority ethnic” to “ethnically diverse” seemed too small when measured against £10 billion investment summits and £42 million ecosystem programs.

Or perhaps, and this is where Ashraf’s challenge about generational thinking cuts deepest, committing to specific, measurable changes requires the kind of accountability that outlasts election cycles and survives scrutiny. Easier to talk about ecosystems and summits and investment destinations than to say yes to proposals that can be evaluated for delivery.

The entrepreneurs in that room didn’t need another speech about Scotland’s potential. They’d built businesses without waiting for government permission. What they asked for was simple: commitment to concrete changes within the government’s direct control.

What they got was an invitation to further conversation. Again.

The question hung in the air, would he commit?, while achievements and initiatives piled up, each one substituting for the answer that never quite came.

When he finally circled back to the language question, the phrasing was careful: “I want to signal tonight the willingness to engage very constructively on the questions about language and to consider what is the best way to express all of these questions.”

Willingness to engage. To consider. To discuss the best way.

Not: “Yes, we’ll standardise ethnically diverse across government.” Not: “Yes, the Chamber can lead engagement with our development agencies.”

The enthusiasm was unmistakable. The appreciation for the community’s contributions, genuine. The invitation to be part of Scotland’s economic journey, heartfelt.

The commitment to the two specific proposals Ashraf had laid out? Conditional on further conversation. On consideration. On engagement about the best approach.

It was an answer that somehow managed to say yes and no simultaneously, a political manoeuvre so practiced it almost looked accidental.

Related Reading:

• The anti-incubator: how Round One is fixing Scotland’s pre-seed broken link

• SNIB’s high-stakes gamble: How Scotland’s £2 billion bank lost its first big bet

• Scotland’s Start-up Paradox: Why government support hurts ecosystems

• The UK’s £310bn Black Hole: How we’re failing female founders and the bold fixes to plug it

• The pie that never grew: How Scotland’s universities are killing billion-pound spin-outs

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The irony wasn’t lost on anyone in the room. Many were sons or grandchildren of farmers and shopkeepers who’d built businesses to put food on the table for their families. They knew the difference between building something that lasts and waiting for the next round of consultations.

Ashraf had talked about the future: ministers, entrepreneurs, leaders who could influence policy and shape narratives. But only, he’d said, if Scotland shifted to generational thinking.

Generational thinking requires commitment beyond the next election cycle. It requires saying yes to things that might not poll well immediately. It requires, in other words, exactly what hadn’t just happened.

Mindset, Ashraf often says, is Scotland’s real barrier. Not capital. Not talent. The unwillingness to take risks, to commit fast, to move forward without another round of consideration.

He’d just watched that mindset in action.

The question Ashraf had asked, the one Swinney had spent ten minutes not answering, seemed to have evaporated the moment he sat down. After the speech, the networking began. Nobody discussed what Swinney had said. Or rather, what he hadn’t said.

Some attendees pulled him aside about business rates and hospitality taxes. The policies making it harder to run restaurants and bars while funding an expanding welfare state. Practical concerns that had nothing to do with language or representation.

Others queued for selfies.

I tried to catch him before he left. A simple follow-up: Had we reached a point where large public investments like TechScaler were failing to hit targets compared to Scottish Edge, which delivered stronger returns on every pound spent? And did he think public money was displacing the private sector and social enterprises he'd championed when launching his manifesto at a social enterprise?

He was already slipping away toward the exit. The response? A quick disagreement brushed aside, followed by the rehearsed script on repeat: TechScaler this, Scottish Edge that, programmes galore. My point on funding displacement dissolved into the same list we’d heard all evening, no engagement, just escape.

The pattern held. Different setting, different question, same outcome.

Two concrete proposals had been laid on the table that night. Both achievable. Both within the government’s power to implement. Both designed by people who’d built businesses without waiting for government permission.

What they got instead: willingness to engage. Consideration. Further conversation.

The same answer Scotland’s entrepreneurs have been hearing for eighteen years.

Ashraf had asked whether Scotland could shift to generational thinking, to building things that outlast election cycles, to making commitments that might not poll well immediately, to backing people who take risks rather than those who wait for consensus.

The answer, delivered over ten minutes of achievements and initiatives and investment summits, was perfectly clear.

Just not the answer anyone wanted to hear.

Yet the gap with global competitors is widening, not closing.

That’s the uncomfortable reality Mark Zwinderman sees after 25 years watching Scotland’s ecosystem evolve. He’s witnessed the recent acceleration: a 2023 independent review pushed UK-wide equity from 21.5% to 16.1% in a single year. The 243 active Scottish spin-outs now ranking third regionally. Edinburgh, Strathclyde, and Glasgow breaking into the UK top 20.

“I think it’s moving in the right direction,” he says carefully.

But here’s what the progress masks: MIT and Stanford have limited non-participating academics to 3-5% equity for decades. While Scotland celebrates dropping from 20% to 12%, California writes £25,000 cheques for scrappy experiments and Scottish founders still attend their fifth business plan workshop to access reimbursement grants.

While UK equity averages improve, professors still negotiate for 10-30% as non-participants and PhD students still negotiate with supervisors who control their careers.

The system trains founders to chase grants instead of customers, creates zombie companies that survive on public funding but never scale, abandons founders after 12 months of 10-year journeys, and optimises for equity extraction despite lower percentages because the power dynamics remain broken regardless of whether universities take 12% or 20%.

The stakes: Scottish universities produce research worth tens of billions annually, yet commercialise perhaps 5-10% of that potential. The gap between Scotland’s 1,520 scale-ups under £5m and just 85 above £50m represents 138,000 potential jobs and £22bn in lost annual revenue.

Progress exists. The 2024-2025 acceleration proves Scotland can move fast when pushed. The question is whether jogging matters when your competitors have been sprinting for a decade.

“At the moment, equity is seen as this really valuable thing. And a lot of the advice around spin outs and startups is around equity as your most valuable asset. So don’t give up too much equity,” Mark explains. “The point that I make is that actually, equity is what you need to grow the business. It’s the fuel for growth.”

This isn’t theory. It’s the difference between MIT’s systematic spinout success and Scotland’s systematic spinout struggle. Between Stanford’s billion-pound exits and Scotland’s early-stage acquisitions. Between ecosystems that treat equity as fuel and ecosystems that treat it as treasure.

TL;DR: Key Findings

The acceleration that’s still not fast enough: UK university equity stakes fell to 16.1% in 2024 (Scotland ~12%), down from 21.5% in 2023. MIT and Stanford models typically limit non-participating academics to low single digits (3-5%). Progress accelerated, but global competitors made these changes a decade ago.

The equity delusion: Lower average stakes help, but don’t fix the fundamental problem. Professors still negotiate for 10-30% as non-participants, cap tables remain cluttered, and equity is still treated as compensation rather than fuel. Stanford and Cambridge prove the alternative works.

The real problem nobody’s fixing: Even at 12% university stakes, the negotiation dynamics remain broken. PhD students still negotiate with supervisors who control their careers. Non-participating faculty still claim substantial equity. The power imbalance persists regardless of average percentages.

The timeline mismatch: Support programs last 12-18 months. Deep tech journeys last 5-10 years. Silicon Valley, Cambridge, and leading European hubs figured out long-term founder support. Scotland abandons founders precisely when they need help most.

The grant trap: Reimbursement-based grants require 100-120% upfront capital before companies can claim funds back, excluding the scrappy early-stage companies they’re meant to help. Professional grant writers now capture significant portions of available funding. Worse: the system creates zombie companies that survive on grants but never grow, never scale, never build real businesses.

The £25,000 solution nobody’s implementing: Direct cheques for six-month experiments over bureaucratic programs. Simple. Proven elsewhere. Mark Zwinderman and Andrew Williams (ScotlandIS chair) both advocate for this approach; one that aligns with how scrappy start-ups actually work. Not happening in Scotland.

The recent momentum: Scotland now has 243 active spinouts (11.8% of UK total), ranking third regionally after London and South East. Edinburgh, Strathclyde, and Glasgow rank in UK top 20 for spinout activity. New initiatives like the Spinout Pipeline Project (£800,000 funding) and Enterprise Hubs expansion show institutional movement.

The opportunity cost: 138,000 potential jobs and £22bn in annual revenue that will be created in ecosystems that stopped debating equity frameworks and started building companies.

The £100,000 or £10,000,000 Question

Here’s a question that determines whether billions in research reaches the market:

Would you rather have 20% of £100,000 or 5% of £10,000,000?

If you answered 20% of £100,000, you think exactly like the people killing university spinouts.

The mathematics is obvious when written down. But sit in a university spin-out negotiation, add power dynamics, egos, decades of academic hierarchy, and suddenly 20% of nothing becomes more attractive than 5% of something extraordinary.

“A growth mindset, if I can use that cliche, is this pie needs to become a hundred thousand times bigger. So whether or not the size of your slice isn’t actually that important; it’s how you use the pie to grow the business,” Mark explains.

Three years to spin out: How Scotland hot here

“I set up my own spin-out a very long time ago, 25 years ago, when there were no policies, systems, processes and knowledge really on how to do it. So it took three years to get the spin-out process completed.”

“I think it’s moving in the right direction,” Mark says carefully. Programs like Converge Challenge in Scotland have emerged. Universities have policies now. Equity stakes have come down from historical highs of 30-40% to around 12% in Scotland today, with the sharpest drop happening in 2024, from 21.5% to 16.1% UK-wide.

But here’s what happened while Scotland moved from 30% to 12%: MIT maintained its 3-5% guideline for non-participating academics for decades.

Stanford spun out Google, Instagram, and dozens of billion-dollar companies. Singapore restructured its entire university commercialisation approach. Cambridge became Europe’s leading deep tech hub.

“I think over the past 10 years, there’s been an improvement in the support to young academics, so postdocs, people who are at the PhD stage.” Yet the scale-up gap, 1,520 companies under £5m shrinking to just 85 above £50m, suggests Scotland is improving at precisely the things that don’t matter while global competitors solve the actual problems.

The negotiation room: Where power dynamics trump economics

Picture the room where equity gets decided.

Around the table: A professor who’s devoted 20 years to developing the technology. Two PhD students who did the actual lab work for the past three years. A commercial champion brought in to help with the spinout. And hovering invisibly over everything, a university technology transfer officer who’s already claimed 20%.

“The university’s approach to this is a lot along the lines of this is the kind of equity we’re taking, 20%. Now go and negotiate amongst the team what the rest of the business should look like.”

This is where brilliant science goes to die.

The professor, having spent two decades on this research, believes they deserve the lion’s share. It’s their life’s work. Their intellectual property. The PhD students are in an impossible position.

“In the university hierarchy [they] sit below professors or PIs and they don’t have a lot of power or control over their life and career in general. And they’re trying to negotiate an equity stake without creating a conflicting relationship with their supervisors.”

“It’s a power dynamic thing,” Mark says simply.

The commercial champion sits there thinking about something entirely different: Series A funding rounds, hiring a world-class CTO, the management team they’ll need to recruit, the 5-10 year journey ahead to build an actual business.

“And the commercial person sits in that mix going, hang on a second, we need equity to grow this business. And if you guys want to take 60, 70, 80% of it between yourselves, we’re not going to be able to grow this business.”

What happens next shapes everything

The deals that emerge from these negotiations reflect power, not value creation potential. The people most likely to actually build the business, young, energetic postdocs willing to go full-time, end up with insufficient equity to justify the risk. The professor who will remain in academia retains a large stake that mainly complicates the cap table.

And investors? They look at the structure and walk away. Too much equity tied up in non-participants. Not enough room for future management. Cap table already a mess before the company has revenue.

“A lot of potential spin-outs don’t happen. Because people look at the process and they go, this is too complicated, too messy, too political. I’m just going to stay in academia. Or I’m going to go work for an existing company rather than try and start my own spin-out.”

The Cultural barrier nobody acknowledges

“Culturally, a PhD or a postdoc is not going to be able to negotiate with a professor on an equal footing. It’s just not how the university system works.”

This is the admission that changes everything. Not “it’s difficult.” Not “it needs improvement.” It’s structurally impossible within how universities operate.

“Because these cultural barriers can’t be overcome in the near future. They are ingrained in how universities operate and how business operate.”

Mark isn’t being pessimistic. He’s being realistic. Power dynamics between professors and PhD students won’t change quickly. University incentive structures won’t shift overnight. But acknowledging these barriers means designing systems that work around them rather than pretending they don’t exist.

The MIT standard Scotland is slowly adopting

The solution exists. MIT and Stanford figured it out decades ago, limiting non-participating academics to low single digits (typically 3-5%) through practice and conflict-of-interest guidelines.

“Setting a maximum amount of equity to non-participating academic founders of three percent. The evidence is in, it’s done in America, it works for MIT. If you’re not going to join the business you can’t have more equity than that.”

Scotland responded. An independent review pushed founder-friendly terms. By 2024, UK university equity fell to 16.1% (Scotland around 12%), down sharply from 21.5% in 2023. Edinburgh, Strathclyde, and Glasgow now rank in the UK top 20 for spin-out activity with 243 active companies.

Progress accelerated. But here’s what the averages hide: professors still negotiate for 10-30% as non-participants. Cap tables remain cluttered before companies have revenue. The power dynamics that create these structures persist regardless of whether the university takes 12% or 20%.

Meanwhile, US universities, having made similar changes a decade ago, continue spinning out category leaders while Scottish equivalents struggle to attract world-class management because equity structures remain problematic despite lower institutional stakes.

Could Scottish universities adopt full MIT-style frameworks tomorrow? Of course. Does it require new legislation? No. Additional funding? No. Just a decision to standardize the emerging practice into clear, published guidelines that protect equity for growth.

The acceleration of 2024-2025 proves change is possible. The question is whether it’s fast enough when global competitors made these moves years ago and Scottish spinouts still face the negotiation dynamics that 12% university stakes don’t solve.

The universities could fix this tomorrow. They won’t.

“I think the universities could be a lot more hands-on in how they structure that conversation. And say, look, this is the equity structure that we think works for spinning out a business. Rather than saying, sort it out amongst yourselves.”

“And I think there is an opportunity there to improve that,” Mark says diplomatically.

The process problem compounds the equity problem. Universities bring in commercial champions only after equity is decided, team is formed, critical decisions made. By then, they’re cleaning up messes rather than preventing them.

Commercial champions should be involved from the point a technology is identified as having commercial potential, not just when the spin-out process begins.

“The high growth spin-out program, (HGSP) is actually a really, really excellent program. But it would have a higher rate of success if the universities would step up and say, this is what our spin-out structure is going to look like.”

Why don’t they? Because acknowledging the power dynamics means admitting the current “sort it out amongst yourselves” approach is fundamentally broken. Because standardising frameworks means professors lose negotiating leverage. Because fixing this requires universities to choose between protecting academic hierarchy and building successful companies.

They’ve chosen hierarchy.

The five-to-ten year journey nobody supports past month 12

“A lot of the university spin outs in a way are moonshot businesses, because they are deep tech, they have science, they have technology that requires several years of development, and then it needs to get into the market. So you’re usually looking at a five to 10 year timeline for those companies to become proper commercially successful businesses established in the market.”

“I think there’s a lot of support available, but I think the challenge is that a lot of it is quite short-term. So you’ll have programs that will support you for six months, 12 months maybe.”

“And I think what’s missing is that long-term support. So once you’ve gone through the initial programs, once you’ve got your seed funding, once you’ve got your first customers, what happens then?”

Month 18: when founders realise they’re alone

“The challenges that founders face don’t stop after 12 months or 18 months. They continue for years.”

“The program itself is quite time-limited. And once you’ve gone through the program, that support tends to drop off. And I think if there was a way to extend that support, even if it’s just a lighter touch, it would make a big difference.”

“I think what would be really valuable is having mentors or advisors who can work with founders over a longer period of time. Not just for six months or a year, but for three years, five years even.”

“And I think the value of that is that the coach or the mentor isn’t looking for anything from you. They’re not looking for equity, they’re not looking for a job, they’re not on your board with their own legal obligations. They’re just there as an independent sounding board.”

“Someone you can talk to once a month, once every couple of months, and say, this is what I’m dealing with, what do you think? And I think that kind of relationship is incredibly valuable for founders. Because being a founder can be quite lonely.”

“You’re making big decisions all the time. You’re dealing with a lot of uncertainty. And having someone who’s been through it before, who can help you think through those challenges, is really valuable.”

Why free money requires 120% upfront cash

Ask most people what a grant is, and they’ll say: “Free money. The government gives you cash to do something.”

That’s not how it works. At least not in Scotland.

“A grant is an amazing thing. And when people hear it, they assume, here’s a cheque, go do something amazing. But if you’re working with Scottish Enterprise and other bodies that are set up with public money, that’s not how it works.”

Instead, grants operate on a reimbursement basis.

“They are set up to help businesses spend money that they don’t have to shell out. So in the long run, it is a grant. But in the short term, you actually need cash flow or revenue or an injection of capital over and above the amount of the grant that you have received to be able to deliver on the project to claim back the money from the government.”

“You can need as much as 100% or 120% of a grant, depending on its matching, its cash flow, the duration. And therein you’re claiming three months in arrears. So you’ve got to cover the three months of the project, plus however long it takes for the checks to be paid, plus however long it took to spin up. And that’s a huge amount of money up front to cover being awarded some money.”

“If the government is saying this is an area that matters to us going forward, that’s probably not really out there, change the world, we don’t know what’s coming next type of investment. So it doesn’t necessarily align with start-ups.”

Creating zombie companies that never die and never live

“There is a lot of criticism of the grant funding ecosystem, not because it’s a bad idea per se, but because there are literally professional grant obtainers, applicants, businesses that hop between them.”

Mark has reviewed pitch decks where companies listed grants obtained as achievements. Add up those numbers; impressive amounts. But the company wasn’t at a stage you’d expect if equivalent funding had come through equity or institutional investment.

Why? “Because it takes so much time to go and chase grant money when you’d be better speaking to customers or maybe reaching further afield for the cash to support your growth and your ambition of product development.”

The system shapes behavior in predictable ways. “Businesses are going to contort themselves into fitting into those boxes to achieve the grant fund that’s going to take them to the next level. And they can get distracted from what they were originally trying to do.”

Here’s the mechanism that creates zombies: Scotland’s support ecosystem teaches companies to perform, not build.

A company that can pitch well survives. A company that can write business plans survives. A company that can navigate Scottish Enterprise bureaucracy survives. Whether they have customers becomes secondary.

The system dedicates enormous resources to teaching performative skills, pitching, business plans, workshop attendance, while ignoring the decade-long work of actually building companies: team development, product iteration, customer acquisition, market navigation.

“But actually developing a team and actually experiencing what it means when people say people management is difficult. It is. It’s very difficult.”

The workshop circuit reinforces this. “It’s hard to get people to come into entrepreneurship workshop in Scotland because they’ve already been to five. And in order to get their next grant, they have to go and do another business plan workshop.”

Founders aren’t learning. They’re performing. They’re checking boxes. They’ve mastered the theatre of entrepreneurship while the substance, finding customers, building products, managing teams, navigating markets, gets abandoned because there’s always another grant to apply for, another pitch competition to enter, another business plan workshop to attend.

And then comes the devastating observation:

“Literally, they’re not growing, they’re not scaling, they just survive on grants and they rely on grants.”

These companies look like start-ups. They have pitch decks. They attend events. They have business plans. They’ve been through accelerators. They can articulate their value proposition in 90 seconds.

They just don’t have customers. Or revenue. Or a path to market. Or any of the things that matter.

But they’re excellent at getting grants.

The zombie problem: Why Scotland won’t pull the plug

This is where Scotland’s support ecosystem becomes actively harmful. Companies that should die, that have no path to market, no customer traction, no viable business model, keep shambling forward because the next grant is always available.

But these zombies aren’t random failures. They’re the logical output of a system that rewards pitching over building, business plans over customers, workshop attendance over market traction.

These zombie companies consume resources that could fund actual prospects. They occupy founder time that could be spent building real businesses. They inflate success statistics (Look, 243 active spin-outs!) while disguising systematic failure.

And they’re often the best at what Scotland’s system actually teaches: performing entrepreneurship. They have immaculate pitch decks. They’ve attended every workshop. They know exactly which buzzwords unlock which grants. They can articulate their value proposition flawlessly.

What they can’t do is build a business.

But here’s why the zombies persist: pulling the plug means admitting the support system failed.

If Scottish Enterprise or a university admits a spin-out should close, they’re acknowledging their selection process was flawed, their support was inadequate, their entire framework doesn’t work. So instead, they offer another grant. Another workshop. Another support programme.

The company staggers forward. The founders go through the motions, knowing deep down they’re building nothing. But there’s a salary. There’s status. There’s the fantasy that maybe the next pivot, the next grant, the next programme will change everything.

It won’t.

And because nobody will say “this isn’t working, close it down and try something else,” founders waste years of their lives on businesses that were dead before they started.

“The opportunity cost isn’t just the money, it’s the careers, the alternative ventures, the actual innovations that never happen because talented people are trapped in zombie companies sustained by grants.

Professional grant writers know this. That’s why they’re professional grant writers. They’ve mastered the art of keeping zombies animated just long enough to qualify for the next round of funding.

“They know the system rewards companies that look like they’re progressing, new business plan, updated pitch deck, refreshed market analysis, regardless of whether they’re actually building anything real.

Mark is diplomatic about this. But the implication is clear: Scotland’s grant system doesn’t just fail to create success, it actively prevents failure, which is far worse.

Because failure at least teaches you something and frees you to try again. Zombie companies teach nothing and trap everyone involved.

The £25,000 solution: direct cheques for scrappy start-ups

After working in Scotland for years, running programs, seeing what works and what doesn’t, Mark has a simple proposal that challenges the entire support infrastructure, one that echoes Andrew Williams, chair of ScotlandIS, who recently argued for exactly this approach to revitalise Scotland’s start-up ecosystem.

“Rather than government support in packages, trips, well-wishing, whatever it is, they would succeed more if there was just literally a £25,000 cheque awarding businesses for attempting to do something risky because they can materially do something with that and deliver on an idea or a challenge and that could be taken to the next stage.”

Not a reimbursement grant. Not a program with milestones and reporting requirements. Just: here’s £25,000. Go try something risky. Come back in six months and tell us what happened.

“Six-monthly projects with smaller amounts of cash that’s literally just enough to get folk to hustle, figure out how to do something and show an outcome in that time period would be a very interesting scrappy approach and I think that would align better with how early stage business needs to think to succeed.”

Workshop Fatigue: training performers, not builders

The proposal comes from observing a peculiar Scottish phenomenon: workshop fatigue.

“It’s hard to get people to come into entrepreneurship workshop in Scotland because they’ve already been to five. And in order to get their next grant, they have to go and do another business plan workshop.”

This isn’t just tedious, it’s diagnostic. The ecosystem has optimised for teaching the theatre of entrepreneurship rather than the craft of building companies.

Mark has adapted to this reality. “I’ve always worked very hard to make my workshops very different, knowing that the people in the room have probably already seen 14 business plan workshops, five finance workshops, six pitching workshops.”

Fourteen business plan workshops. Think about that. A founder who’s been through fourteen business plan workshops should have a remarkable business by now. Instead, they’re trapped in a cycle where the next grant requires the next workshop, which enables the next grant, which requires the next workshop.

The pitching workshops are particularly telling.

“I’m not meaning to say that pitch training isn’t useful or important, but I can take somebody who’s terrible at pitching in four hours. And at the end of that four hours, you’re good at pitching. So that’s brilliant. And it’s part of the whole thing.”

A four-hour skill. That’s what pitching is. Yet Scotland has built an entire infrastructure around teaching, testing, and rewarding this four-hour skill as if it were the essence of entrepreneurship.

“But actually developing a team and actually experiencing what it means when people say people management is difficult. It is. It’s very difficult.”

Team building: years. Product development: years. Market navigation: years. Customer acquisition: years. These are the skills that matter. These are the skills Scotland’s workshop circuit ignores because they can’t be taught in an afternoon session that qualifies you for the next grant round.

The result? Companies that are world-class at looking like start-ups and mediocre at being startups.

The English Comparison: when the cavalry doesn’t exist

Mark now lives in England, close to Oxford. The contrast with Scotland is instructive.

“There is no Scottish Enterprise here. So a lot of the support is either unpaid or on purely commercial terms, and it makes people a lot more entrepreneurial.”

The psychological dependency this creates in Scotland is subtle but pervasive:

“When you have a meeting with somebody and you go, oh, we should try X to train more commercial champions. The conversation often steers towards, I wonder if Scottish enterprise would pay for that, or I wonder if Scottish enterprise would have a grant for that, or if the government would pay for that.”

“It’s like we should try to get universities to do a different way of spinning out businesses. Which university would be willing to pay for that? Or how do we structure a commercial model?”

“This whole, again, this comes back to Scottish enterprise is the cavalry. There’s a bit of an attitude of maybe the government slash SE will fund this. And I think that needs to be a bit more... how can we do this ourselves how do we pay for this ourselves how do we invest in ourselves.”

The dependency becomes a crutch. Companies that would either find commercial funding or die quickly instead limp along on grants. Founders who would either build real traction or fail fast instead spend years navigating bureaucracy.

The event circuit: where founders go to feel productive while avoiding real work

“I think sometimes there’s too much focus on events and networking,” Mark says carefully. “And don’t get me wrong, those things are important. Your network is important. But I think there’s a tendency for founders to spend a lot of time going to events, going to pitch competitions, going to networking sessions. And while that can be valuable, it can also become a distraction from actually building the business.”

“A lot of people like to be seen to be going to events and be very busy. If you’re not, then the question is, well, why are you not at this event? Because we never see you at these events. Are you actually working on your business?”

“Which is of course a hilarious question because yes, I’m working on my business. That’s why I’m not at the event.”

Even when attending events makes sense, founders often attend the wrong ones.

“I mentored somebody years ago who was working in earth observation, data analysis, and he was going to a lot of space tech events. And I was like, well, are your customers the space tech companies? And it was like, no. And we realised that his customers are probably insurance companies and finance companies.”

“And he, bless him, pretty quickly picked up on this and then spent his time going to events for the finance industry. Because finance people who are helped by certain data analysis don’t go to space tech events. Why would they? They’re finance people.”

“I think why are you going to this event is always the question you should ask. And this comes back to what I was saying earlier about the difficulty of having focus.”

“So you have to find a bit of a balance. And I think, especially in Scotland, it’s very important that there is a stage for you as a founder in your business to be at some of these events so that people get to know you. But you also have to just at some point say to yourself, am I going to get value out of seeing the same people again? Or do I need to sit at my desk and actually get some work done?”

The ecosystem question: monoculture or jungle?

Near the end of our conversation, I ask the question every policymaker claims to be obsessed with: “What needs to change to make the ecosystem better?”

Mark’s answer surprises me.

“I think, you know, that question of how do we make the ecosystem better? I like to rephrase that always into how do we make the ecosystem healthier?”

Healthier. Not bigger. Not better funded. Healthier.

“And because the word ecosystem comes from nature, what is a healthy ecosystem? Is it a mono plantation of trees or is it a jungle full of different things? And a healthy ecosystem is an incredibly varied mix of things.”

The instinct of policymakers: find “the solution” and scale it. Find the program that works and fund it massively. Create a center of excellence. Build a flagship initiative.

“There isn’t a silver bullet. So I would say don’t fund one big thing and expect that to be the silver bullet. That is a monoculture approach to innovation and by definition that can’t be innovation. That’s crazy.”

Monoculture. The word conjures images of vast identical crops, vulnerable to disease, requiring intensive management, extracting nutrients until the soil is depleted.

“I have my own views and ideas on what I think is going to work. And it wouldn’t take me more than five minutes to find somebody in my LinkedIn contacts who will say the opposite of what I’m saying.”

“That’s a brilliant part of the conversation. We’re wanting to spark that. That is what we need. Debate, because debate leads to innovation and trying and approaching different things.”

What Foundations Actually Look Like

“And at the moment, we are very good at painting beautiful pictures of skyscrapers, but we’re not very good at making sure those foundations are ready to support a skyscraper. And that’s where the work now needs to be.”

The equity framework: “Setting a maximum amount of equity to non-participating academic founders of 3%. The evidence is in, it’s done in America, it works for MIT. If you’re not going to join the business you can’t have more equity than that.”

The process framework: “The universities can create frameworks, rather than saying to the entire team, sort it all out and figure it out amongst yourselves. They need to be more hands-on involved and say, here’s a framework on how this is going to work going forward, so that the spin outs move out faster.”

What actually needs to change

Mark isn’t just complaining. He has specific, achievable recommendations:

Immediate (next quarter):

Standardise equity frameworks. MIT’s 3-5% guideline for non-participating academics isn’t a suggestion; it’s a proven model backed by decades of practice. Scottish universities could adopt it tomorrow.

Create standard term sheets. Stop making PhD students negotiate complex legal agreements. Work with experienced start-up lawyers once, then use those terms for every spin-out.

Accelerate approval processes. Six to eighteen months with standardized frameworks? Should be three to six months maximum.

Medium-term (1-3 years):

Build long-term founder support. £50-100,000 annually supports 20-30 founders with experienced, independent coaching over three to five years. Not expensive. Massively impactful.

Match funding to reality. Deep tech takes five to ten years. Stop funding with twelve-month programs. Create multi-year structures with staged gates.

Pull the plug on zombie companies and make it safe to fail. Create explicit sunset provisions: if a company hasn’t achieved defined customer traction milestones within 18-24 months, funding stops.

Not as punishment, but as liberation. Make “pivoting to a new venture” an acceptable outcome. Track founder success across multiple attempts, not just first ventures. Stop treating closure as failure and start treating it as valuable learning.

The goal isn’t to keep companies alive; it’s to free talented founders to find what actually works. Scottish Enterprise should celebrate founders who close zombie companies and launch better ones, not quietly sustain the undead because admitting failure threatens institutional metrics.

Replace reimbursement grants with direct funding. The £25,000 cheque model. Six-month experiments. Scrappy, focused, aligned with how startups actually work. Require customer evidence, not business plans, for second tranches.

Systemic (requires cultural shift):

Change what universities celebrate. Spinning out a successful company should count toward tenure as much as a major research grant.

Build genuine patient capital. UK and European VC isn’t set up for deep tech. This requires pension funds, sovereign wealth funds, corporate venture arms with strategic patience. Government intervention necessary.

Update regulatory pathways. Deep tech often hits regulated sectors. Accelerated approval pathways, early regulatory guidance, regulatory sandboxes could dramatically reduce barriers.

What definitely won’t work:

• More generic accelerator programs teaching lean startup to deep tech founders

• More pitch competitions rewarding presentation skills over substance

• More networking events unless strategically focused on connecting founders with actual customers

• Bigger university equity stakes (that’s the opposite of what’s needed)

• One big flagship initiative

The choice Scotland faces

Mark’s skyscraper metaphor captures the entire problem: “We are very good at painting beautiful pictures of skyscrapers, but we’re not very good at making sure those foundations are ready to support a skyscraper.”

Scotland has the blueprints. MIT did it. Stanford did it. Cambridge did it. The evidence exists. The frameworks work. The path is clear.

What’s missing isn’t knowledge; it’s execution.

The 2024-2025 acceleration proves Scotland can move fast. Universities dropped equity stakes from 21.5% to 16.1% in a single year. But this is precisely the trap: celebrating progress while stopping halfway. Accepting 16.1% average stakes while professors still claim 30%.

Launching new 12-month programmes while pretending they match 10-year realities. Sustaining zombie companies on grants rather than admitting failure and freeing founders to try again.

The changes needed aren’t mysterious:

Immediate: Adopt full MIT-style guidelines (3-5% caps for non-participating faculty, not just lower university averages). Publish standardised frameworks; don’t leave equity to negotiation. Reduce approval timelines to 3-6 months.

Medium-term: Build 3-5 year founder support matching deep tech reality (not enhanced 12-month programmes). Restructure funding for actual timelines. Kill zombie companies. Address power imbalances that 12% university stakes don’t solve.

Systemic: Shift university culture to celebrate commercialization like research. Build genuine patient capital. Update regulatory pathways.

Scotland can finish what it started in 2024-2025. Or it can celebrate incremental progress while watching California, Boston, Cambridge, and Singapore commercialise research that started in Edinburgh labs because they built the foundations a decade ago while Scotland was still painting pictures of skyscrapers.

The 138,000 jobs and £22bn won’t wait for Scotland to catch up to where MIT was in 2015.

Related Reading:

• The anti-incubator: how Round One is fixing Scotland’s pre-seed broken link

• SNIB’s high-stakes gamble: How Scotland’s £2 billion bank lost its first big bet

• Scotland’s Start-up Paradox: Why government support hurts ecosystems

• The UK’s £310bn Black Hole: How we’re failing female founders and the bold fixes to plug it

What my near-death experience in the Sahara reveals about why most start-ups fail

The clutch started slipping around noon.

By 2 PM, my KTM 890 Adventure was grinding metal on metal somewhere deep in the sand between Morocco and Western Sahara. No mobile signal. Temperature climbing past 40°C. Water for maybe six hours if I rationed it.

Two bikers had died near this exact stretch the previous year.

I sat on a dune and did the math. The hire company was in Casablanca, eight hours away if I could even reach them. The nearest village was maybe 15 kilometres back, but I’d already burned through most of my water getting this far. Walking in motorcycle boots through soft sand in that heat would be suicide.

This was not the adventure I’d planned. This was the gap between challenging myself and catastrophically poor judgment, and I’d just crossed it.

Then I saw dust on the horizon.

But what happened next still strikes me as one of the most instructive experiences of my life.

The silver lining you only get if you stay

Some Arabs in a beaten Toyota pickup stopped without me even flagging them down.

It was Ramadan. They hadn't eaten or drunk anything since sunrise. Yet within twenty minutes, I was sitting in their compound while they insisted I eat, enormous quantities of food, multiple courses, the kind of hospitality that makes you question everything you thought you knew about human nature under scarcity.

They helped me contact, the hire company. The owner drove through the night from Casablanca. By 8 AM the next morning, he handed me the keys to a KTM 890 Rally, a significantly better bike for sand than the one that had broken down.

I'd started the previous day stranded and genuinely frightened. I ended it with new friends, a full stomach, and an upgraded motorcycle.

Every cloud has a silver lining.

But here's what most people miss: you only get the silver lining if you stay present long enough for it to arrive.

If I'd panicked when the clutch burned out, tried to force the bike further, made increasingly desperate decisions, collapsed into pure catastrophe mode, I'd never have been in position to receive help. I'd have been ten kilometers deeper into the desert, out of water, invisible to passing traffic.

The transformation from disaster to gift required me to accept the disaster first. To stop fighting it. To sit on that dune and stay present with the reality that I was genuinely stuck.

This pattern, absolute disaster transforming into unexpected opportunity, isn't optimism. It's not positive thinking. It's an observable phenomenon that most people never experience because they're too busy catastrophising to stay present for the transformation.

And it's the exact pattern I've watched play out in reverse with over 1,000 start-up founders.

Disaster they choose

Let me tell you what a startup founder’s version of that burned-out clutch looks like.

A founder has an idea. Maybe it’s genuinely good. Maybe there’s real value buried in there. But instead of finding out whether anyone will actually pay for it, they do something else.

They perfect. They polish. They add features nobody asked for. They redesign the logo. They build elaborate systems for customers who don’t exist yet. They spend six months on a business plan before making a single sale.

They polish the turd.

I've watched over 1,000 founders do this. Not as a passive observer – as someone actively trying to help them stop. I showed them the frameworks. I explained the principles. I practically begged some of them to just sell something before building anything else.

They couldn't stop.

The pull toward polishing is almost gravitational. It feels like progress. It feels productive. It's safe in a way that selling isn't, because selling means someone might say no. Someone might reject not just your product, but you.

So founders retreat into the comfortable work of perfecting something that nobody has validated, and they call it "building the business."

I didn't choose to burn out my clutch. They choose to hide from revenue.

When my bike broke down, I had no choice but to stop and face reality.

The desert doesn't care about your feelings. The temperature doesn't negotiate. You either accept what is and work with it, or you die.

But start-up founders can hide indefinitely. They can polish for months, even years, because nothing immediately catastrophic happens.

The "temperature" rises slowly. The water drains gradually. By the time they realise they're stranded, they're already dead, they just haven't stopped moving yet.

The enemy isn't incompetent founders. Many are brilliant.

The enemy isn't bad ideas. Many have real potential.

The enemy is broken thinking, the set of assumptions, habits, and fears that cause talented people to destroy their own chances of success while the ecosystem that's supposed to help them actively makes it worse.

And the start-up ecosystem, far from fighting this enemy, actively reinforces it.

Got a hot take on the start-up ecosystem? We love ideas that challenge the status quo.

If you think the current model of accelerators is broken, or you have a contrarian view on how start-ups should actually scale, contact John on LinkedIn or email John.glover@theburnoutfiles.com

Start-up industrial complex Is lying to you

Here’s something nobody wants to admit: the startup advice industry is optimised for the survival of the advice industry, not the survival of startups.

Think about it.

Accelerators need a steady supply of founders to maintain their business model. They need enough applications to be selective (credibility through rejection).

They need enough participants to justify their existence (volume equals legitimacy). They need enough “success stories” to market the next cohort (survivorship bias as strategy).

What they don’t need is for most founders to actually succeed.

In fact, high success rates would be problematic. If 80% of founders succeeded, the accelerator’s “value add” becomes questionable, maybe the founders would have succeeded anyway. The narrative requires struggle, requires failure, requires the accelerator to be the hero of impossible odds.

So they teach methodologies that produce 90%+ failure rates and call it “the nature of startups.”

Let me be specific about what’s broken:

Broken Thing #1: The six-month business plan

I know about this personally because it nearly killed my juice bar business before it started.

After running a motorcycle import business for three years, a business I’d started by buying a broken Yamaha for $200 in Los Angeles, fixing it, and selling it for £1,500 in Edinburgh; I wanted to start something new.

I’d seen juice bars everywhere in LA and knew they’d work in the UK.

So I signed up for a government-sponsored programme called Instant Muscle. My mentor, Bill, had successfully electrified the UK’s east coast railway line. Nice guy. Knew his stuff.

The programme told me I needed to spend six months writing a business plan before I could start trading.

What I should have done: open a pop-up juice bar in the Edinburgh Meadows that weekend. Spend £200 on a blender and fruit. See if anyone would actually pay. Get revenue, then write the plan.

What I actually did: followed the advice, wrote the plan, and watched the moment pass.

That programme had never heard of validating demand before building. Neither had I. The Lean Startup movement didn’t exist yet.

But here’s what makes me angry: that same advice is still being taught today, fifteen years after Eric Ries proved it was backwards.

Broken Thing #2: The pitch deck obsession

Traditional fundraising has founders spending 12+ months pitching investors. Hundreds of emails. Dozens of meetings. Countless rejections.

The business stagnates because they’re spending 20+ hours per week trying to raise instead of building.

If they eventually raise £150,000, they might do it by selling 15-20% of a company that’s still worth almost nothing because they spent a year pitching instead of growing.

Meanwhile, investors are making decisions based on ten-minute presentations optimised for persuasion rather than accuracy. They’re trying to assess “founder quality” based on confidence, storytelling ability, and pattern-matching to previous winners.

It’s astrology dressed up as analysis.

Traditional angel investing achieves a 10x return only 9% of the time, according to OECD research. Venture capital isn’t much better—the British Business Bank found that only 10% of VC investments achieve a 3x return.

These aren’t the odds of a functioning system. These are the odds of institutional guessing.

Broken Thing #3: The ‘safe space’ delusion

Most accelerators create environments where every idea is valid, every founder is “doing great,” and hard truths are softened until they’re meaningless.

This feels supportive. It’s actually cruel.

When you protect founders from discomfort, you protect them from the information they need to succeed. You let them drift into comfortable delusion while calling it “building.”

We partnered with Ash Maurya (creator of the Lean Canvas) in 2022, running nine events across Scotland.

We offered 1,000 entrepreneurs access to his LEANSTACK platform and his complete Foundations playbook.

Then we launched an accelerator and asked applicants to complete a Lean Canvas as part of their application, a task that takes perhaps two hours.

We rejected 1,058 applications because founders hadn’t bothered to do it.

Think about that. Access to one of the world’s leading startup methodologists. Free access to his platform. A clear, simple task that takes two hours.

And 1,058 founders couldn’t be bothered.

This isn’t a founder problem. This is a system problem. The ecosystem has trained founders to believe that attendance equals progress. That participation equals value. That showing up to workshops matters more than doing the uncomfortable work of actually selling something.

The system is broken. And I’m tired of pretending it isn’t.

What I built instead: The Startup Race as the clarity engine

When I realised that workshops, frameworks, and one-on-one mentoring weren’t working, I had to ask myself: what would actually force founders to face reality the way the Sahara forced me?

Not harsh feedback. Not tough love. Not even good advice.

Public, competitive measurement of the only thing that matters: revenue.

Here’s how it works:

52 founders. One year. Every single one generating at least £5,000 in annual revenue when they start—proof they’ve already sold something, not just built it.

Every week, they report their revenue. Not projections. Not “pipeline.” Actual money from actual customers, verified through Xero or QuickBooks.

Every week, a league table updates publicly.

Position 1: highest revenue growth.
Position 52: lowest revenue growth.

The top 10 constitute the Premier League, visible to all observers, including investors who are watching to decide where to place their capital.

At the end of 50 weeks, the founder in position 1 receives £100,000 in investment for 10% equity.

Now imagine you’re in position 3. Next week you slip to position 7.

How hard are you going to work to get back? What experiments will you finally run? What uncomfortable customer conversations will you stop avoiding? How much time will you waste redesigning your logo?

This is competition as clarity.

The league table doesn’t judge your worth as a person. It doesn’t measure your intelligence or your value as a human being.

It measures one thing: revenue growth. The most honest signal available about whether you’re building something people want.

Why this will make people angry (and why that’s okay)

I know what the criticism will be:

“Competition is toxic. Founders need support, not pressure.”

“This creates unhealthy stress.”

“Not everyone learns the same way. Some people need gentler approaches.”

“You’re just replicating capitalist violence and calling it innovation.”

Let me address these directly.

On competition being toxic:

Competition reveals who actually wants to succeed versus who wants to feel like they’re succeeding. The Startup Race doesn’t create pressure, it makes existing pressure visible.

Founders are already competing. For customers. For market share. For investor attention. For survival.

The question isn’t whether competition exists. It’s whether we’re honest about it.

I’d rather have founders compete on revenue in a structured race where everyone learns than compete blindly in a market where 90% fail without understanding why.

On stress:

I want to be clear about something: I take founder wellbeing seriously. The goal of the Startup Race isn’t to create stress, it’s to create clarity.

There’s a crucial difference between:

Acute stress from knowing where you stand (productive, informative, time-limited) and chronic stress from not knowing if you’re making progress (corrosive, paralysing, indefinite).

The first type, the discomfort of seeing your position drop, of typing zeros into a spreadsheet, of watching the gap between where you are and where you want to be, is sharp but useful. It tells you something. It motivates action. It ends when you close the gap.

The second type, the gnawing uncertainty of “is this working?”, the months of building without validation, the slow realisation that you’ve wasted years on something nobody wants, is what actually destroys people.

I’ve watched the second type break talented founders who never recovered. The drift I experienced after my juice bar plan failed nearly destroyed me. Not because it was acutely painful because it was chronically uncertain.

The Startup Race trades chronic uncertainty for acute clarity. That’s not cruelty. That’s kindness.

But here’s what’s non-negotiable: if at any point a founder’s mental health is genuinely at risk, they should step back. No race, no business, no achievement is worth sacrificing your wellbeing.

The difference is this: productive discomfort pushes you toward growth. Destructive stress pushes you toward collapse. One makes you stronger. The other breaks you.

We’re building the former, and we’re vigilant about preventing the latter.

On people learning differently:

This is true. Some people do learn better in gentle, supportive environments.

Those people should absolutely have access to those environments.

But let’s stop pretending that gentle support produces the same results as competitive clarity. It doesn’t. The data is clear.

The winner of our £10,000 Startup Race, Priyanshu Nath, achieved 44x growth in six months. From £100 ARR to £4,400.

Find me a “gentle, supportive” accelerator that’s produced those results. I’ll wait.

On replicating capitalist violence:

This is the criticism that frustrates me most, because it comes from people who’ve confused comfort with compassion.

Here’s what’s actually harmful: letting talented people waste years of their lives on approaches that don’t work while telling them they’re “doing great.”

Here’s what’s actually harmful: the start-up industrial complex that needs a steady supply of failure to justify its existence.

Here’s what’s actually harmful: investors making decisions based on ten-minute pitches and pattern-matching, producing 90%+ failure rates, while acting like this is “just how startups work.”

The Startup Race is the opposite of harm. It’s honesty in a system built on polite lies.

The methodology: three weapons against broken thinking

Everything I teach exists to counter specific forms of broken thinking. This isn’t theory—it’s an arsenal forged by watching talented people destroy their own businesses while I tried to help them stop.

Weapon 1: The minimum revenue product

The Lean Startup gave us the Minimum Viable Product—the smallest thing you can build to test an idea.

But “product” keeps the focus on building, and building is where founders hide.

The Minimum Revenue Product is the smallest thing you can sell.

When you’re building an MVP, you ask: “What’s the minimum I need to create before I can test this?”

When you’re creating an MRP, you ask: “What’s the smallest thing I can sell to validate that someone will pay?”

These questions lead to radically different actions.

MVP thinking: “I need to build a prototype, then test it with users, then iterate based on feedback, then...”

MRP thinking: “I can sell one hour of consulting on this problem today. If someone pays, I’ll know there’s demand.”

Priyanshu didn’t perfect her journals before launching. She sold pre-orders on Kickstarter with prototypes. She used revenue to validate demand, then built.

This is what Ash Maurya calls “Demo-Sell-Build.” It sounds backwards because broken thinking has trained us to believe building comes first.

Building first is how you end up polishing a turd.

Weapon 2: The product pyramid

Broken thinking says: pick a price and stick with it.

This is almost always wrong.

Consider weight loss, the same transformation available at radically different price points:

• £0: Cut out beer and cake (ultimate DIY)

• £15/week: Join Weight Watchers

• £50/month: Join a gym

• £100/week: Hire a personal trainer

• £1,000+: Liposuction (ultimate done-for-you)

What changes isn’t the outcome. It’s how much work the customer does versus how much is done for them.

Now apply this to a start-up:

• 100 customers at £15/month = £1,500/month

• 10% upsell to £50/month = £500/month

• 10% of those to £400/month = £400/month

• Total: £2,400/month from just 100 entry-level customers

Quadruple your base to 400 customers and you’re at £115,200 annually, a potential £1,000,000 valuation.

The pyramid counters broken thinking because you’re not trying to convince strangers to spend £400/month. You’re offering upgrades to people who already know, like, and trust you.

Here’s where it gets interesting: the expensive version doesn’t have to be objectively better.

Steve Blank tells a story about deliberately throttling technology so he could sell a “faster” version each year. The product didn’t change, the perception of the product changed.

Tesla does this with Ludicrous Mode. The hardware is identical in every car. The software limitation is artificial. Pay more, and Tesla flips a switch.

You’re not buying a faster car. You’re buying the feeling of a faster car, which turns out to be the same thing.

This makes some people uncomfortable. “Isn’t that manipulation?”

No. It’s alignment between what customers want to pay and what they’re ready to receive.

The customer who needs hand-holding should pay for hand-holding. The customer who wants to figure it out themselves should have that option.

The pyramid serves everyone by letting them choose their own level of commitment.

Weapon 3: The learning gap

We built a brutally simple chart into the Traction App.

Time on the horizontal axis. Revenue on the vertical. You draw a line from where you are to where you want to be. Each week, you plot actual revenue.

The gap between the two lines, between intention and reality, is the Learning Gap.

Most startup programmes try to eliminate discomfort. They create “safe spaces” where every idea is valid and every founder is “doing great.”

The Learning Gap makes reality visible, persistent, and impossible to ignore.

Every week, you see the distance between what you said you’d do and what you actually did.

Founders also manually enter their metrics every day. Not synced automatically. Typed by hand. Including zeros.

If you acquired no customers today, you type “0.” If you generated no revenue, you type “0.”

This seems inefficient. It’s deliberately inefficient.

The act of typing zero forces conscious acknowledgment.

You can’t passively notice a “0” and scroll past. You have to actively participate in recording reality.

The gap creates discomfort. That’s by design. The discomfort is information.

I used this on myself while building the Traction App. I had to raise my revenue goal three times because I kept beating it. The discomfort of seeing the gap between where I was and where I’d committed to be was unbearable, so I closed the gap.

This is what the system refuses to teach: clarity about where you stand is better than comfortable uncertainty about whether you’re making progress.

Revenue is your new pitch deck

Here’s the fundamental reframe:

Traditional pitch decks are narratives about what might happen.
Revenue is evidence of what is happening.

One requires investors to guess. The other lets them observe.
One is theatre. The other is truth.

Consider the math:

A founder enters the race at £5,000 ARR, the minimum qualification threshold. At a 10x revenue multiple, their company is worth approximately £50,000.

Over 52 weeks, using the methodology I’ve described, they grow to £100,000 ARR. Their company is now worth approximately £1,000,000.

That’s 20x growth in valuation.

Not by raising money. Not by pitching investors. Not by any of the activities that broken thinking says founders should prioritize.

Just by building. Just by selling. Just by doing the one thing that actually creates value.

To receive the £100,000 investment prize, they sell 10% of their company.

Compare this to the traditional path: spending 12+ months pitching, getting rejected, watching the business stagnate. If they ever raise at all, they might get £150,000 by selling 15-20% of a company that’s still worth almost nothing.

The Startup Race makes building the pitch.

Revenue growth increases valuation. Investors watch 52 weeks of verified performance instead of a ten-minute presentation optimised for persuasion.

Everyone’s incentives align.

The founder is incentivised to grow revenue (the only thing that improves their position).

The investor is incentivized to watch for genuine execution (the only thing that predicts future success).

The ecosystem is incentivized to teach what actually works (because results are public and verifiable).

This is what the start-up industrial complex should have built decades ago.

Instead, they built a system optimised for their own survival, not yours.

Why everyone actually wins (even if you come last)

Here’s what broken thinking gets completely wrong about competition: it assumes someone has to lose.

Let’s be specific about what every participant gets:

The founder who wins receives £100,000 in investment for 10% equity. But more importantly, they’ve built a business generating £100,000+ in annual revenue, validated their model under competitive pressure, and developed habits that will serve them forever.

The founder who comes last leaves with something more valuable than most MBA programmes provide: absolute clarity about what it takes to grow a business.

They’ve seen their Learning Gap week after week. They know exactly where they drifted, where they polished instead of selling, where they struggled to maintain focus.

This is lived experience of their own patterns, challenges, and possibilities. The kind of knowledge you can only get by trying and learning from the gap between intention and execution.

And here’s the crucial thing: the founder who comes last this year can come first next year.

But only if they recognise that every cloud has a silver lining.
Only if they stay present long enough for the transformation to happen.

Mariely Olmedo came second in our race. She’s a designer from Chihuahua, Mexico, selling handbags made from cactus leather. She didn’t win the top prize, but the competition gave her coverage in fashion magazines and proof of her ability to perform under pressure.

The silver lining was visibility she couldn’t have achieved alone.

The investors get something unprecedented: 52 weeks of observable founder behavior under competitive pressure.

They see who handles setbacks. They see who learns from the gap between intention and reality. They see who finds the silver lining when things go wrong.

Traditional angel investing achieves a 10x return only 9% of the time. When you can watch founders execute for an entire year, revenue verified, not projected, those odds should improve dramatically.

You’re not guessing which founder will execute. You’re watching them execute, then investing in the proven winner.

The start-up ecosystem learns what actually works. Most accelerators still teach methodologies that produce 90%+ failure rates while acting like this is “just the nature of startups.”

Every founder who applies these principles and achieves 44x growth is evidence that better approaches exist.

The economy wins when more startups succeed. More tax revenue. More employment. More problems solved. More human potential realized instead of wasted on approaches that don’t work.

The thirteen-year-old in the field

I grew up on RAF airfields in West Germany during the Cold War, watching Harrier jump jet pilots train. My father was in the Signals Regiment.

When we moved to Scotland, I played rugby and lived on a farm. My father’s stories of Scottish inventors, James Watt, Alexander Graham Bell, John Logie Baird, Alexander Fleming, captured my imagination.

I vividly remember walking through a field at thirteen, thinking: I’d like to establish a foundation for Scottish inventors when I grow up.

I left school at fifteen. Failed to join the Signals Regiment. Assembled gyroscopes for Ariane rockets at Ferranti’s before deciding factory work during dark Scottish winters was destroying my soul.

Became unemployed. Found Outward Bound, climbing Munros, canoeing down the Tay. Became an instructor.

Then came America. Camp Wonposet in Connecticut, July 1989. Within a week of my arrival, a hurricane destroyed it.

A sensible person would have flown home.

Instead, I traveled to Nassau by seaplane, made friends with other Brits, and drove a pickup truck to Los Angeles. Got a job as a bouncer at the Whisky a Go Go on Sunset Strip.

Saved enough to buy a non-running Yamaha XS1100 for $200. Gambled that a replacement CDI unit would fix it, drawing on electrical knowledge from Ferranti’s, the job I’d thought was worthless.

The gamble paid off. The bike ran. I rode it as a courier for three months. Exported it to Edinburgh. Sold it for £1,500. Built an import business on that foundation.

Then came the juice bar business plan. The decade of drift. The domain name. The burned-out clutch in the Sahara.

It took thirty years, seven start-ups, a hurricane, and watching over 1,000 founders polish their turds before I understood what that thirteen-year-old really wanted.

Not a foundation that hands out grants.

A mechanism that helps founders discover what they’re capable of by making reality impossible to ignore.

That transforms disaster into opportunity. That makes the gap between intention and reality productive rather than demoralising.
That fights broken thinking with every weapon available.

The Startup Race is that mechanism.

And if the startup industrial complex doesn’t like it, if accelerators feel threatened by a model that produces 44x growth instead of 90% failure rates, if investors are uncomfortable with being asked to watch execution instead of guess from pitch decks, that’s okay.

The system needs to evolve. It’s been comfortable long enough.

Will you stay present long enough?

Here’s what I know from burning out a clutch in the Sahara:

The disaster itself doesn’t determine the outcome. How you respond to it does.

I could have panicked. Made desperate decisions. Tried to force my way forward on broken equipment.

Instead, I sat on that dune and stayed present with the reality that I was stuck.

And because I stayed present, I was there when help arrived. I was there when strangers offered extraordinary generosity. I was there when the hire company handed me a better bike.

The silver lining only appears if you stay present long enough for it to arrive.

Most founders never learn this because they step away too early—not because they stop trying, but because they stop facing reality.

They drift into comfortable delusion. They polish instead of sell. They hide from the Learning Gap instead of learning from it.

The Startup Race exists to make staying present with reality unavoidable.

You can’t hide when your revenue is public every week.

You can’t drift when fifty other founders are showing you what’s possible.

you can’t polish turds when the only thing being measured is whether customers will pay.

Sometimes the clutch burns out.
Sometimes you’re stranded in the desert. Sometimes you spend ten years drifting away from your goals.
Sometimes you come last in the race.

And sometimes, if you stay present long enough, by 8 AM the next morning you have a better vehicle than the one that broke down.

The question is: will you stay present long enough?

Or will you keep polishing?

The £100,000 Startup Race begins April 2026.

If you’re already generating £5,000+ ARR, you’re ready to compete.

If you’re not there yet, the Preparation Programme will teach you the methodology that produced 44x growth.

Either way: stop polishing. Start selling.

Revenue is your new pitch deck.

To find out more visit: thestartuprace.com

James Shoemark is co-founder of The Startup Race. He developed its methodology over seven startups, five years as an Outward Bound instructor, and a decade working with at-risk youth in Scotland.

He once bought a broken motorcycle for $200 and sold it for £1,500. He believes the startup industrial complex is optimise d for its own survival rather than founder success, and he’s building an alternative.