Scottish City Becomes the New Hub for 'TravelTech' Investment

The use of artificial intelligence throughout the travel technology sector is revolutionising every element of discovering, booking and experiencing travel.

Edinburgh has become a focal point for investments in travel technology companies.

A recent study indicates that the UK’s "traveltech" industry is experiencing unprecedented investment, with Edinburgh playing a significant role as an important centre for innovation, largely due to advancements in artificial intelligence (AI).

The detailed report compiled by Dealroom, an analytics firm, which was requested by the Traveltech Innovation Hub at Edinburgh Futures Institute—part of the University of Edinburgh—reveals that the UK now ranks as the third leading destination for travel technology investments worldwide, following closely after the US and Canada.

Research indicates that UK travel technology firms have secured approximately $1.6 billion (£1.2bn) through almost 300 transactions since 2020, with 2024 setting a new high point as investments reached over $518 million, primarily spurred by innovations powered by artificial intelligence.

One of the featured deals included £315 million raised by London’s Lighthouse during its Series C fundraising round in November 2024. This firm leverages artificial intelligence to enhance hotel pricing and distribution tactics. Another notable mention goes to Unravel, which recently garnered $7 million in Series A financing just last month. Their AI-driven video platform converts motivational content into trip opportunities that can be booked directly.

Beyond London, Scotland stands out as a significant UK traveltech centre, boasting over 100 travel tech startups. Among these enterprises, Obvlo secured $2 million to create AI-driven tools aimed at generating and sustaining personalized local content on a large scale for various travel and hospitality firms like Virgin Hotels. Additionally, Barcelona’s TravelPerk declared plans to open a new branch in Edinburgh.

Nevertheless, the report — which is the first to thoroughly analyse the UK’s traveltech sector — also underscores various challenges within the industry. It points out that from 2022 through 2025, merely 6% of traveltech venture capital funds in Europe were allocated to startups led by women founders.

Joshua Ryan-Saha, who leads the Traveltech Innovation Hub at the Edinburgh Futures Institute, stated: "These findings highlight the UK's role as a global frontrunner in travel technology innovation. Thanks to its exceptional AI specialists and robust culture of innovation, Edinburgh is uniquely positioned to spearhead advancements in this field."

The integration of artificial intelligence throughout the travel technology sector is revolutionising every facet of discovering, booking and enjoying travels. This is generating substantial prospects for forward-thinking businesses, especially those utilising Edinburgh’s expertise in AI research and development.

Callum McPherson, CEO and founder of Obvlo, stated: "Scotland provides the ideal blend of skilled workforce, top-tier educational institutions, and strong initial funding to foster a superior technology hub."

By concentrating on traveltech, we can utilise our robust tourism sector along with the existence of prominent industry players as a springboard for international success. Obvlo is thrilled to partner with the Edinburgh Futures Institute in propelling the advancement of travel technology not just in Scotland but further afield.

The UK travel technology industry appears robust across various sectors, notably within hospitality-focused Software-as-a-Service (SaaS). In 2024 alone, over $480 million has been channelled into innovations aimed at boosting operational efficiency, enhancing customer experiences, and maximising revenues.