The Midlands continues to establish itself as a thriving hub for technology innovation, with 2024 underscoring the tech sector's critical role in driving regional economic growth. Aaron Baker, Investor at BGF, one of the UK and Ireland’s leading growth capital investors, highlights the sector's impact not only as an independent powerhouse but also as a driver of productivity across other industries.

BGF has supported over 100 tech-enabled businesses, including Midlands-based companies Skewb and Metric Search, helping them achieve their scale-up ambitions. Birmingham Tech Week (BTW) founder Yiannis Maos projects that the West Midlands tech sector could reach a £100 billion market capitalisation by 2030, spurred by international investment and homegrown business growth. Additionally, Barclays Eagle Labs reports a significant rise in tech company incorporations in the East Midlands, home to 48 University of Nottingham spinouts.

Following an election year and a pivotal Budget announcement, improving economic conditions—such as declining inflation and anticipated interest rate cuts—are setting the stage for sustained growth. Targeted government funding in advanced manufacturing, clean energy, and biotechnology, combined with a modern industrial strategy, is expected to attract private investment, drive mergers and acquisitions, and boost fundraising activities in key sectors.

The Midlands has seen traditional industries adapt to the digital era, spawning tech start-ups and scale-ups that are reimagining older business models. With its central location, strong infrastructure, world-class universities, and a growing network of innovative companies, the region offers fertile ground for scaling businesses.

Aaron Baker noted the impressive progress in building a collaborative tech ecosystem, describing it as a place with “fantastic energy and support.” However, he emphasised the importance of amplifying the Midlands' tech potential nationally and internationally, particularly by supporting early-stage businesses to achieve global success.

Flexible funding has historically been a challenge for Midlands SMEs. BGF, which has invested over £4 billion in 600 companies since 2011, addresses this gap with a minority-only investment model that empowers entrepreneurs while providing expertise, advice, and networks.

Looking ahead, Baker sees 2025 as a year of opportunity for well-capitalised businesses to leverage improving economic conditions. Companies with a long-term vision are expected to drive growth through innovation, talent development, and expansion into new markets.

As the Midlands tech sector continues to scale new heights, it is poised to play an even greater role in shaping the UK’s economic future.