The UK’s traveltech sector has reached record investment levels, with Edinburgh emerging as one of the country’s key innovation hubs thanks to advances in artificial intelligence, according to analysis from Dealroom.
A new TravelTech Report, commissioned by the Traveltech Innovation Hub at Edinburgh Futures Institute, has found that the UK has become the third-largest traveltech investment destination in the world, behind only the USA and Canada, with UK traveltech firms having raised $1.6 billion (£1.1bn) since 2020 across nearly 300 deals.
According to the data, last year saw record investment in UK traveltech reaching $518 million (£387.6m), driven largely by AI-powered innovation, with major deals including the $370 million (£276m) secured by London-based Lighthouse in Series C funding in November 2024.
Also celebrating serious investment is Unravel, which just last month secured $7 million (£5.2m) in Series A funding for its AI-powered video platform that transforms inspirational content into bookable travel experiences.
London is developing into a traveltech powerhouse, with eight out of the top 11 leading firms identified in the report having their base in the English capital.
Outside of London, Scotland is emerging as a UK travel tech hub, with more than 100 travel tech startups, with Edinburgh-based Obvlo recently raising $2 million (£1.5m) to develop AI solutions for personalised local content for travel and hotel brands such as Virgin Hotels.
Meanwhile, Barcelona-based travel management company TravelPerk has announced the opening of a new office in Edinburgh, with the city also being home to the likes of TravelNest, Citizen Ticket, and of course, Scotland’s traveltech unicorn, Skyscanner.
“Edinburgh, with its world-class AI expertise and dedicated innovation ecosystem, is particularly well-placed to drive this sector forward,” said Joshua Ryan-Saha, Director of the Traveltech Innovation Hub at the Edinburgh Futures Institute.
“The application of artificial intelligence across the traveltech landscape is transforming every aspect of how we discover, book and experience travel. This is creating significant opportunities for innovative companies, particularly those leveraging Edinburgh’s excellence in AI research and development.”
Even beyond AI, the report found that the UK traveltech sector shows strength in multiple sub-sectors, with particularly strong investment in SaaS (Software as a Service) for hospitality.
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Over $480 million (£359m) was invested last year in solutions that enhance operational efficiency, improve guest experience, and optimise revenue, while more than $60 million (£44.8m) was invested in solutions addressing payments, expense management, and financial services for travellers.
The UK’s travel and tourism sector generally demonstrated remarkable resilience, with its contribution to GDP climbing to 10% in 2023 to reach more than $252.4 billion (£188.4bn), surpassing the pre-pandemic peak of 2019.
“The travel sector has proved itself to be resilient post-pandemic, but it’s notable that the number was significantly boosted by AI-focused companies,” said Eglantine Dupuy, a research associate at Dealroom.
“We are seeing many startups using artificial intelligence to supercharge innovation across the sector — from personalised content and booking platforms to revenue optimisation tools.”
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