British Patient Capital has invested £30 million in Northern Gritstone Limited, an investment company focused on university spinouts and R&D-intensive businesses in the North of England.
The investment by the British Business Bank subsidiary follows on from the £215m raised by Northern Gritstone last year, and sits alongside an investor base including M&G and Greater Manchester Pension Fund. Other institutional investors are expected to follow later this year.
With a focus on spinouts from partners at the Universities of Leeds, Manchester and Sheffield, and other local science and technology start-ups, Northern Gritstone is supporting the commercialisation of the world-class research and innovation originating from these institutions. It aims to boost the venture ecosystems around these communities, drawing in further external capital to drive their growth. While Northern Gritstone will typically invest at pre-seed and seed stage, as a long-term investor, it has the capability to invest throughout the lifecycle, and into more established businesses at the later stage.
It intends to become one of the largest investors into academic spin-outs and IP-rich businesses in the UK, dedicated to financing companies in some of the fastest growing sectors such as advanced materials, energy, health technology and cognitive computation.
Catherine Lewis La Torre, CEO of British Patient Capital, said: “The UK’s universities are recognised as a hub for break-through research and development. Scaling these businesses across the whole of the UK is critical, as is energising the venture capital ecosystem in the North of England. Northern Gritstone’s mission aligns with British Patient Capital’s aim to provide the patient capital required to enable the world-class businesses of the future to thrive and become players on the global stage. We are excited to work with them on driving this vision forward.”
Investments by British Patient Capital were found to be a driving force for innovation behind Scale-Up Britain by a recent independent evaluation of BPC. Eleven per cent of BPC-backed companies are academic spinouts compared to 2% of all equity-backed companies, turning cutting-edge research into real-world products.
Duncan Johnson, Chief Executive at Northern Gritstone, said: “This significant investment from British Patient Capital marks a tremendous achievement for Northern Gritstone as we continue to attract many of the investment world’s most significant players which share our ethos, values and vision as Northern Gritstone shareholders.
“British Patient Capital’s investment is not only a testament to the power of Northern Gritstone’s mission to support science-led spin-outs in the North of England and an endorsement of our ‘profit with purpose’ investment philosophy, but will also strengthen our ability to deliver against these ambitions.
“Having already begun making investments in some of the region’s most exciting and innovative businesses, we look forward to growing our portfolio in the year ahead as we continue to work towards our ultimate goal of developing a northern hub of innovation in technology and science.”
britishpatientcapital.co.uk & northern-gritstone.com