Founders outside London just got a Budget built for them. Here’s how to make the most of it

A new founders’ relief and a bigger British Business Bank change the maths for building a company in the regions, writes Dave Foreman, CEO of PXN Group.

If you’re building a company in Leeds, Newcastle, Glasgow or Edinburgh, this week’s Budget had more in it for you than most. A new founders’ relief will tax up to £10m of lifetime gains at 10% from April 2027. The British Business Bank gets an extra £5bn of capacity, including £1.4bn for equity funds backing high-growth businesses and £450m for a new venture debt product. And English mayors are gaining real financial powers to back the places where founders live and hire, including a share of business rates and a £1.5bn borrowing facility. Scotland and the other devolved nations receive equivalent funding through the Barnett formula.

For founders, that changes three things: what you keep, who you can hire and where you can raise.

First, the reward for building here: Founders take an enormous personal risk to build a company, and this Budget recognises it. A 10% rate on up to £10m of lifetime gains sends a clear message: the UK wants its most successful founders to stay, and to back the next generation once they exit. We’ve seen what that cycle can do. In the past 12 months alone, six companies we have backed have been sold, in deals worth more than £400m. Every exit is a chance to put capital and hard-won experience back into the ecosystem.

Second, the ability to hire and keep great people: EMI2 will double the value of tax-advantaged share options an employee can hold to £120,000. For a scaling company competing with London salaries, a meaningful stake in the business is often what wins the hire, and now the ceiling is higher.

Third, the route to growth capital: For most founders outside London, the hardest raise isn’t the first one. It’s the one after. Northern universities account for a third of UK research income, yet the region attracts around 11% of venture funding. That is the gap to close, and this Budget starts to close it. A bigger British Business Bank, a new venture debt option and the government’s commitment to work with pension providers to accelerate capital into scaling businesses all widen that route. A new scale-up programme for women founders, alongside the British Business Bank’s growing pipeline of commitments to women-led funds, will widen the pipeline too. A new regional Scale UK Connect pilot will also help 200 high-growth firms across the UK with tailored support and investor connections.

What founders should do now

Start by planning ahead. The founders’ relief and EMI2 both come into effect from April 2027, so it’s worth talking to your advisers early about what they mean for your own shareholding and for the options you offer your team. When it comes to your next round, look beyond London. Specialist investors in the regions know your market, your talent pool and your sector, and they’re about to have more public capital working alongside them.

It’s also worth getting to know your mayor, if you’re in England. Good Growth Funds (£285m in 2027-28, including incubator capital) and new local powers will shape where investment, infrastructure and talent programmes go, and founders who engage early can help set those priorities rather than finding out about them afterwards. If you’re in Scotland, the same applies to your local and devolved government. And if you’re lucky enough to sell, treat it as a beginning rather than an ending. The strongest ecosystems are built by founders who put their next pound back in close to home, as angels, mentors and repeat builders.

The Budget has given founders outside London a stronger hand. The companies that play it well are the ones we’ll be talking about in ten years’ time.