UK Business Demography – January 2025 Update
As of January 2025, the UK is home to 5.46m active and dormant companies, representing a slight drop of 0.20% from the 5.47m recorded at the end of October 2024.
21 February 2025 • 5 minute read
Overview
As of January 2025, the UK is home to 5.46m active and dormant companies, representing a slight drop of 0.20% from the 5.47m recorded at the end of October 2024. This period has been marked by a general decrease in new business formations, with a median drop of 8.98% across the UK. Despite this slowdown in incorporations, investment trends offer optimism —with an overall increase in equity funding across the past three months. The West Midlands emerged as a standout, with a total of £283m secured in equity funding. However, it’s important to note that a significant £210m deal by Aston Martin in November contributed to 74.2% of the total raised in the region during this period. This grant is part of the funding awarded to Aston Martin for the development of a luxury battery electric vehicle platform.
Grant funding presented a mixed picture. Whilst a wide number of regions saw declines in funding levels, the North East bucked the trend with an increase in grant funding, receiving £106m between January 2024 and January 2025—nearly quadrupling the previous period’s figures. This surge was primarily driven by a £85.6m grant awarded to the Offshore Renewable Energy (ORE) Catapult in May 2024. This grant was published by Innovate UK in December 2024.
Spinout activity remained heavily prominent in London and the South East, which continued to dominate the landscape with 290 and 266 active spinouts, respectively.
Regional highlights
As of January 2025, London accounts for 28.4% of all active and dormant companies in the UK. The region leads in population figures and number of incorporated businesses due to its significantly large company base. Despite securing the highest total in equity funding at £2.57b, London did not lead in grant funding over the past year. This spot was taken by companies in the South East, which secured £307m in grants between January 2024 and January 2025. Although London was awarded more grants overall (806 compared to 444 in the South East), firms in the South East received a greater number of high-value grants. This is a nod towards a slightly higher quality of firms and industries being explored, that are aligned to national interests. Examples include a £196m grant awarded to Urenco, which offers chemical enrichment services for the nuclear industry. This grant marked the highest value award during the period between January 2024 and January 2025.
Beyond London and the South East, the North West stood out when considering equity funding, raising £372m between November 2024 and January 2025—a 223% increase from the £115m raised in the previous period. This substantial growth was propelled by two major deals: PlaceFirst’s £145m round in January 2025, and a £122m transaction by NScale in December 2024, together accounting for 71.8% of the region’s total for the period. Additionally, the North-West saw a 26.2% increase in active spinouts, rising from 107 in October 2024, to 135 in January 2025. Despite this growth in funding volume, the number of deals is slightly lower, suggesting a shift towards fewer, but larger, high-value transactions, as opposed to a greater frequency of smaller deals.
While grant funding generally declined across regions, there were exceptions. Yorkshire and the Humber, the East Midlands, the North-East, and Northern Ireland all reported increases in grant funding over the past 12 months.
North East
North East experienced the smallest reduction in company formations across the UK, with a 6.39% drop in new company incorporations.
In terms of grant funding, the North East significantly diverged from national trends by recording a substantial 239% increase in grant awards. During the period between January 2024 to January 2025, companies in this region secured a total of £106m, a significant surge from the £31.2m observed in the previous year. A major contributor to this increase was an £85.6m grant from Innovate UK to the Offshore Renewable Energy (ORE) Catapult in May 2024. This grant was published by Innovate UK in December 2024.
The North East's entrepreneurial ecosystem is robust, anchored by innovation hubs like Newcastle Helix. This district in the heart of Newcastle is home to several knowledge-based, research-led enterprises, including Nunabio, a company developing custom DNA strands for use in genetic research. Additionally, Barclays Eagle Labs in Grainger Town is closely located to this innovation quarter. In partnership with Floe, it provides coworking and incubation spaces to support various businesses in Newcastle.
Wales
Wales was the top region in terms of population growth between November 2024 and January 2025, observing an increase of 1.52% to 195,000 active and dormant companies. During this period, Welsh businesses also experienced a remarkable surge in equity funding, securing £57.8m, reflecting growth of 345%. A significant driver of this activity was a £31.4m deal by Urban Centric, a company providing real estate services for renters.
Welsh companies obtained £40.7m in grant funding between January 2024 to January 2025. A notable contribution to this total was a £23.7m grant awarded to Hyhaul Mobility in February 2024, accounting for 58.2% of the region's grant funding for that period. The Cardiff-based firm was founded in 2021, and specialises in hydrogen-powered freight transportation systems.
The region's business ecosystem is supported by entities such as Tramshed Tech. Located in Grangetown, this facility offers workspaces, business support programs, and specialised training tailored to tech startups and scaleups. It also hosts the local Eagle Labs team and serves as a networking and support hub for graduates of the Tramshed’s Startup Academy incubator program, further stimulating entrepreneurial activity in Wales.
Key metrics
The metrics used in this analysis provide an understanding of the strength and potential within the UK’s business environment, illustrating the landscape in which these companies operate. By analysing the fluctuations in company populations and trends in new business formations, we can assess the appeal and supportive capabilities of each region, plus their capacity to foster and sustain business growth.
Companies that manage to attract equity investment or secure innovation grants are clearly poised for growth and development, underscoring their ambitions to not only expand but also innovate within their sectors.
Moreover, the presence of spinouts in each region highlights active intellectual property creation, which is essential for driving innovation and competitiveness. This not only fuels economic development within these regions but also strengthens the broader UK economy by enhancing its innovative capacity and global competitiveness.
Methodology
The analysis for the UK Business Demography– January Update derives from Beauhurst’s comprehensive database of UK company data. The data sourced covers the three months up to the end of January 2025. It also includes grant data for the 12 months from January 2024 to January 2025, with growth rates calculated using the grant data sourced from October 2023 to October 2024. The grant data is based on data published by Innovate UK. The population data for spinouts in the UK is accurate up to January 2025.
UK Business Demography map
Company population:
The analysis for the UK Business Demography– January Update derives from Beauhurst’s comprehensive database of UK company data. The data sourced covers the three months up to the end of January 2025. It also includes grant data for the 12 months from January 2024 to January 2025, with growth rates calculated using the grant data sourced from October 2023 to October 2024. The population data for spinout in the UK is accurate up to January 2025.
Scotland |
|||
| Company population now: | 302,818 |  |
0.23% |
| Incorporations in past 3 months | 8,730 |  |
-9.52% |
| Investment in past 3 months: | £104m | |
-9.57% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £51.4m | |
-45.4% |
| Spinouts: | 186 | ||
Northern Ireland |
|||
| Company population now: | 94,340 | |
-0.40% |
| Incorporations in past 3 months | 2,712 | |
-30.5% |
| Investment in past 3 months: | £36.4m |  |
21.3% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £20.5m | |
-14.9% |
| Spinouts: | 56 | ||
North West (England) |
|||
| Company population now: | 533,888 | |
-0.02% |
| Incorporations in past 3 months | 18,428 | |
-7.53% |
| Investment in past 3 months: | £372m | |
223% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £63.4m | |
-3.21% |
| Spinouts: | 135 | ||
Wales |
|||
| Company population now: | 194,919 | |
1.52% |
| Incorporations in past 3 months | 5,283 | |
-14.0% |
| Investment in past 3 months: | £57.8m | |
345% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £40.7m | |
-5.91% |
| Spinouts: | 71 | ||
West Midlands (England) |
|||
| Company population now: | 435,715 | |
0.10% |
| Incorporations in past 3 months | 14,746 | |
-8.24% |
| Investment in past 3 months: | £283m | |
904% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £63.3m | |
-35.3% |
| Spinouts: | 65 | ||
South West (England) |
|||
| Company population now: | 357,684 | |
-0.36% |
| Incorporations in past 3 months | 8,658 | |
-13.0% |
| Investment in past 3 months: | £49.6m | |
-42.0% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £90.4m | |
-14.7% |
| Spinouts: | 142 | ||
North East (England) |
|||
| Company population now: | 122,463 | |
0.35% |
| Incorporations in past 3 months | 4,323 | |
-6.39% |
| Investment in past 3 months: | £11.7m | |
-44.3% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £106m | |
239% |
| Spinouts: | 55 | ||
Yorkshire and the Humber (England) |
|||
| Company population now: | 331,071 | |
0.11% |
| Incorporations in past 3 months | 10,915 | |
-10.5% |
| Investment in past 3 months: | £18.2m | |
-72.3% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £135m | |
2.18% |
| Spinouts: | 96 | ||
East Midlands (England) |
|||
| Company population now: | 301,987 | |
-0.30% |
| Incorporations in past 3 months | 9,322 | |
-7.31% |
| Investment in past 3 months: | £16.4m | |
-23.0% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £16.8m | |
0.74% |
| Spinouts: | 64 | ||
East of England |
|||
| Company population now: | 504,166 | |
0.19% |
| Incorporations in past 3 months | 14,913 | |
-10.1% |
| Investment in past 3 months: | £283m | |
-20.1% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £59.2m | |
-36.7% |
| Spinouts: | 195 | ||
London (England) |
|||
| Company population now: | 1,546,849 | |
-0.88% |
| Incorporations in past 3 months | 63,760 | |
-8.45% |
| Investment in past 3 months: | £2.57b | |
142% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £224m | |
-5.18% |
| Spinouts: | 290 | ||
South East (England) |
|||
| Company population now: | 730,163 | |
-0.05% |
| Incorporations in past 3 months | 19,155 | |
-8.38% |
| Investment in past 3 months: | £538m | |
126% |
| Grants in past 12 months (Jan 2024 - Jan 2025): | £307m | |
-1.97% |
| Spinouts: | 266 | ||
Download the demography map here:
UK Business Demography map (203kb pdf)
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