- 402,000 new companies incorporated across the UK in H1 2026
- Active company base grows to 5.66 million businesses
- Startup activity continues across every UK region, with Scotland recording the strongest growth
- Application software startups increase 40% year-on-year, highlighting the strength of the UK technology sector
The UK's active business population has reached a record 5.66 million companies, demonstrating the strength and adaptability of British entrepreneurship despite a moderation in new company incorporations, according to the latest New Startup Index.
A total of 402,000 new businesses were registered with Companies House in the first half of 2026, a 5.7% decrease compared with H1 2025. However, entrepreneurial activity remained widespread across every region of the UK, with the continued growth in the active company base providing evidence of the resilience of the UK business landscape.
Technology businesses were a standout performer during the first half of the year. Application software became the UK's most active startup category with 28,100 new businesses incorporated. The wider digital and technology sector also recorded strong growth, reflecting continued innovation and investment in areas such as AI and emerging technologies.
Regional entrepreneurship also remained vibrant. Scotland recorded the strongest growth in startup activity, with incorporations rising 3.73% compared with H2 2025. The East Midlands followed with growth of 3.30%, while London remained the UK's leading hub for new business creation, accounting for more than 136,000 new companies.
While incorporation volumes have adjusted compared with previous years, the data suggests regulatory reforms may be contributing to a higher-quality company register by reducing low-intent and fraudulent registrations.
Darren Pirie, Head of Accelerator and Strategic Partnerships at NatWest, said:
“The latest data shows UK entrepreneurship remains in good health. While startup formation has moderated, more businesses are operating across the UK than ever before and founders continue to identify opportunities for growth, particularly in high-potential sectors such as technology and software. The strength of entrepreneurial activity across every region of the country underlines the important role new businesses play in supporting innovation, investment and local economic growth.”
Sebastian Burnside, Chief Economist for NatWest Group, said:
“Britain’s startup economy is adjusting, not retreating. While incorporations eased in the first half of 2026, the active company base has continued to grow, showing the underlying resilience of UK entrepreneurs against a turbulent backdrop. The shift towards software and digital businesses is especially striking and speaks to the economy’s changing centre of gravity as technology transforms what we do and how we do it. This underlines the importance of backing the founders who are driving those opportunities wherever they are, connecting them to the right support, and helping turn ambition into long-term growth.”
Founder view: Pounce Padel
Pounce Padel designs and manufactures high-performance padel rackets tailored specifically for women, with a mission to help more women move, play and enjoy the sport.
The business was launched seven months ago by founder, Georgie Rennie, who won the Royal Bank of Scotland Accelerator Pitch competition in April 2026. She scooped the top prize of £15,000 after impressing a panel of industry experts at the opening of the bank’s new Accelerator hub in Edinburgh. The business will use the prize money to expand into children’s equipment, aiming to encourage more young girls to take up padel and build skills early.
Georgie Rennie, Pounce Padel Founder, said:
“I'm only seven months into launching Pounce Padel, so the pace of the last year still surprises me some days. But the biggest surprise as a startup has been the support I've received. People I've never met have reached out on LinkedIn and Instagram wanting to back the business, following the journey and cheering me on.”
“I'm proud to have been able to set up my business in Scotland. Scotland has a real entrepreneurial energy. What stands out about Scotland’s startup community is its collaborative spirit. Founders are prepared to think big, but they are also generous with their experience and connections. With continued access to finance, expert coaching and networks, hopefully myself and other Scotland based entrepreneurs can continue to build businesses that are successful both within and beyond the domestic market.”
Notes to editors
The New Startup Index is produced by NatWest in partnership with Beauhurst and analyses Companies House incorporation data across the UK. Data for this edition covers the period January to June 2026 and was accurate as of 17 July 2026.
Read the full report here
