The 2026 tech ecosystem report ‘Region on the rise: South Yorkshire's pathway to scale’, released on January 29th by TECH SY in partnership with Dealroom at the South Yorkshire Tech Summit 2026 in Barnsley.

The data shows the region strengthening its position as one of the UK’s fastest‑growing innovation economies, driven by record investment rounds, a surge in university spinouts, and deepening specialisation in frontier technologies.

Record investment and rapid ecosystem expansion

The report reveals that:

• South Yorkshire’s startups are now worth £3.1B, with 100+ VC‑backed companies operating across the region.

• Since 2020, the ecosystem has grown almost 4×, and over the past decade more than 15×.

• 2025 was a record year at £52M for early‑stage VC investment, with rounds up to £11M — almost double 2024 levels.

• The region also recorded its strongest-ever year for Series A funding, marking a step‑change in the maturity of its startup pipeline.

• Pre‑exit companies (not yet public or acquired) are now valued at over £1B, demonstrating growing scale‑up potential.

• Deep tech continues to be South Yorkshire’s strongest specialisation: attracting £121M since 2022, making it the top‑funded sector.

Transportation, Climate Tech, Energy and Fintech have also emerged as fast‑growing segments, each exceeding £70M in VC funding. These align with UK industrial strategy key growth sectors and local growth plans.

The report notes that physical tech and deep tech make up a greater share of South Yorkshire’s funding compared with the UK overall, reflecting the region’s strengths in advanced materials, engineering, and manufacturing‑led innovation.

Universities accelerating commercialisation

The University of Sheffield produced a record 10 spinouts in 2025, placing it 8th in Europe for deep‑tech and life‑science entrepreneurship. Regional spinout activity mirrors a wider national shift, with innovation increasingly distributed across the UK and the North, not concentrated solely in the Golden Triangle.

Sheffield Hallam University, Barnsley College, Doncaster UTC and the new South Yorkshire Institute of Technology have been investing in education for the next generation of tech talent.

National and international benchmarking

South Yorkshire’s tech ecosystem is now tracking at a similar enterprise value to where Helsinki and Pittsburgh were a decade ago. Both cities later became globally recognised hubs in gaming, robotics, AI and advanced engineering — highlighting South Yorkshire’s potential to scale in comparable sectors.

Across the wider North of England, startups have generated over £7.1 in enterprise value for every £1 of VC invested, outperforming both the UK average and London.

Emerging defence and dual‑use hub

South Yorkshire’s defence and dual‑use technology sector is expanding, anchored by strengths in advanced manufacturing, materials, cyber and nuclear supply chains.

The region has been designated a priority growth area under the UK’s Defence Industrial Strategy, receiving a share of the £250m Defence Growth Deal to unlock new industrial, research and skills opportunities.