Innovation powering region's technology potential

The South West's investment landscape presents a tale of two halves: near-term economic pressure, and emerging opportunities that could transform the region’s tech ecosystem.

According to the latest quarterly investment report from Exeter-based Tech South West, regional investment fell sharply in Q1 2025 – down nearly 40% year-on-year to £136 million. This mirrors a national decline, with UK-wide investment dropping 35% to £3.77 billion. However, the impact in the South West is being felt unevenly.

Bristol dominated with £93.6 million raised, while Exeter and wider Devon attracted £22.9 million, and Somerset brought in £11.8 million. Other counties saw far less: Dorset received £725,000, Cornwall £600,000, and Wiltshire just £380,000.

Ben Cooper, Head of Funding and Finance at Tech South West, attributes the decline to macroeconomic uncertainty, particularly affecting pre-seed ventures. Angel investors are holding back, while venture capital firms remain active mainly at Series A level and above.

Despite these challenges, one area continues to shine: deep tech. While only 20% of South West companies on shipshape.vc are deep tech, they represent 44% of the platform’s equity value. These companies aim to raise £94 million this year – more than half of the region’s projected total.

Breakthroughs include autonomous underwater vehicles, toxic chemical removal technologies, green energy sailing vessels, and recycled EV battery cells — signalling global potential in net zero and energy security.

There are success stories too. Cornwall’s Inyanga Marine secured over £500,000 for tidal energy consulting, while Altilium Clean Technology in Plymouth raised £4 million for EV battery recycling. Bristol’s Bunch and Somerset’s Origen raised £1.47 million and £10.5 million respectively.

New investment vehicles are reshaping the landscape. Foresight’s £100 million South West Fund and QantX’s university spin-out support are attracting institutional interest. Meanwhile, angel networks are forming in Cornwall, North Devon, and Cheltenham, reflecting growing local appetite.

With strong universities, innovation hubs, and a growing investor base, the region is well-placed to lead in advanced tech, renewables, and defence. The challenge now is to ensure this momentum spreads beyond Bristol — unlocking opportunity across the entire South West.

A longer version of this story appears in Exeter Tomorrow magazine.