Young companies with big potential are in line to get support worth millions

Young companies in Scotland with big potential are in line to get support worth millions of pounds to help them grow in the wake of the Coronavirus pandemic.

The Scottish Government said the funding involves grants of up to £50,000 for 41 high-growth-potential start-ups and up to £130,000 for 16 spin-out projects.

Economy Secretary Fiona Hyslop added: "Start-up and spin-out companies, many of which are in the technology, digital and low-carbon sectors, are the future of our economy. "They are driven by the spirit of entrepreneurship and innovation.

"Crucially, they are the kind of enterprises that create high-quality jobs, and which attract investment into Scotland - both of which will be vital to successfully rebuilding the economy after the damage caused by COVID-19.

"By supporting start-up companies and spin-out projects through this funding, we can not only help them survive, but give them the potential to prosper. This is a key part of our long-term mission to create new jobs, good jobs and green jobs."

Edinburgh University's Exergy3 spin-out is one of the first to be awarded funding. It aims to provide power storage using a thermal energy storage system.

The pandemic meant that work on Exergy3's small-scale prototype ground to a halt. But, with support from the Scottish Government, the team is now able to take the technology a step closer to commercial use.

Adam Robinson, a lecturer in mechanical engineering at the university, said: "This funding will springboard us to the next stages of our project where Exergy3 can be central to Scotland's low-carbon transition.

"We can now complete and test our small-scale prototype, build a consortium to demonstrate our technology on a working power plant, as well as demonstrate the commercial case for our technology.

"Energy3 has global export and investment potential, and could provide high-quality sustainable jobs of the future." Steve Dunlop, CEO of Scottish Enterprise, added: "The Coronavirus pandemic has had far-reaching impacts on all aspects of our business base, including our high-growth, early-stage businesses and university spin-outs.

"It's vital we continue to support these ventures, so that those with the very best growth potential can flourish into significant businesses of the future."

The grants are the first part of the £38million of funding for early-stage, high-growth potential companies announced in July and managed by Scottish Enterprise.