40 A Smarter City
London’ s innovation economy
London and the South East continue to cement their position at the heart of the UK ' s innovation economy, according to new research from NatWest
The report, From Innovation to Impact, found the regions are home to 9,682 innovative businesses, 4,686 recipients of public innovation grants and 1,041 university spinouts, making them the UK ' s largest and most concentrated innovation ecosystem. Together, they account for almost 40 per cent of the innovative businesses captured within the analysis.
From Innovation to Impact: London and the South East
Follow-on investment
Businesses across London and the South East are already translating innovation into commercial success. Grant-backed firms have secured more than £ 40.5 billion in followon investment, while 1,392 businesses have raised additional equity funding and 483 businesses have successfully exited. London also boasts the highest follow-on investment rate of any major UK region.
Technologies
While the regions already lead the country on many measures of innovation success, NatWest identified 1,685 innovative businesses that are continuing to develop new products and technologies but have yet to reach commercial scale. Supporting more of these firms to grow could help unlock further investment, jobs and economic growth.
" Spend any time with founders across London and the South East and you quickly get a sense of the energy, ambition and creativity that’ s driving this region forward.
Ambition
Catherine van Weenen of NatWest commented: " Spend any time with founders across London and the South East and you quickly get a sense of the energy, ambition and creativity that ' s driving this region forward.
There are thousands of businesses developing new technologies, creating jobs and finding new ways to solve problems.
" Our research shows just how important the region has become to the UK ' s innovation economy. Nearly 10,000 innovative businesses are based here and together they ' ve attracted more than £ 40 billion in investment. That ' s an incredible platform for future growth.”
In numbers
High growth
The findings build on the latest NatWest and Beauhurst Startup Index, which showed almost 180,000 new businesses were launched across London and the South East during the first half of 2026, including 136,000 in London alone, reinforcing the regions ' status as the UK ' s leading home for entrepreneurs and highgrowth businesses.
www. natwestgroup. com
NatWest research showed London and the South East are home to:
• 1,791 innovative businesses
• 9,682 innovative businesses
• 4,686 public innovation grant recipients
• 1,041 university spinouts.