Innovation investment fund tops £100m to provide UK economic boost

Posted on 24 Aug 2023 by The Manufacturer

Investment in the UK Innovation & Science Seed Fund (UKI2S), a driving force in supporting early-stage innovation and high-impact businesses, now totals £102m.

This follows further investment into its patient capital fund by UK Research and Innovation (UKRI) and the Ministry of Defence.

Continued investment in the fund reflects its excellent track record of nurturing ground-breaking businesses and fostering sustainable growth across the UK, having attracted over £700m from the private sector since 2002 – a return of £25 for every £1 invested.

Science Minister George Freeman said: “Innovation is about the seed of an idea being brought to life and I am proud that public investment is continuing to kickstart vital scientific discoveries, including new cancer treatments and technology to identify antimicrobial resistance, that can transform our society’s health and prosperity.

“This funding, reaching over £100m with today’s investment, has so far supported more than a thousand high-quality jobs across the UK and secured more than £700m of further private investment – in turn levelling up our country and boosting our economy.”

UKRI commercialisation lead and Innovate UK CEO Indro Mukerjee said: “After attracting £700m of private investment since 2002, UKI2S demonstrates the value of early, patient investment in technology that is driving sustainable growth. In that time, it has nurtured some of the most innovative businesses in the UK in their early years. UKRI is backing UKI2S to unleash the potential from the UK’s excellent research base.”

Director of the Defence Innovation Directorate at the MOD John Ridge said: “There is a clear need for UK companies to research, develop, commercialise and manufacture sensitive and nationally important defence and security technologies. The Defence and Security fund aims to delivers dual use innovations that ensure the security of our citizens and businesses and give the defence and security services the tools they need to stay safe.”

Andrew Muir, Investment Director at Future Planet Capital Group and Fund Principal for UKI2S, said: “The continuous support and investments from our public sector partners solidify the Fund’s position in the early-stage ecosystem for ground-breaking ideas. We are thrilled to continue enabling the growth of innovative ventures that will shape the future of industries and benefit the UK economy.”

Companies supported by UKI2S have continued to grow by garnering additional funding from other public and private sector investors, enabling them to create impact and solve real-world challenges:

  • Tokamak Energy – Pushing the boundaries of fusion energy, Tokamak Energy are on track to deliver grid-ready fusion power by the 2030s. This ambitious endeavour holds the promise of delivering clean and abundant energy for the future
  • Solasta Bio – Using technology developed at the University of Glasgow, Solasta Bio is a UK AgriTech company specialising in the next generation of green insecticides. Co-founded by UKI2S, it has raised over £4m to scale up the development of its unique nature-inspired pesticides, the first of their kind to be developed worldwide
  • iFAST Diagnostics – This ground-breaking company uses rapid diagnostic technology spun out from the University of Southampton to identify antibiotic resistance ten times faster than current gold standard. Earlier this year, iFAST secured £2m funding to drive their ambition to improve outcomes and combat antimicrobial resistance, potentially saving thousands of lives
  • Crescendo Biologics – This Babraham Institute spin-out, initially financed by UKI2S, focuses on novel T-cell enhancing therapeutics that use the immune system to treat and manage cancer. In July, it announced a significant investment of $32m to expand its clinical trials in oncology
  • Luffy AI – A spinout from the UK Atomic Energy Authority is delivering the next generation in adaptive intelligence for robotics and industrial control. The company was recently highlighted by Gartner in their “Top 10 Tech Trends for 2023” as one of the leaders in Adaptive AI.

Since its inception in 2002, UKI2S has had a remarkable impact on the UK economy:

  • To date, UKI2S has invested £30m in over 90 companies, providing crucial support to emerging innovators
  • Investments have attracted an impressive return of more than £700m in private sector investments, showcasing its ability to catalyse additional funding
  • Approximately 47% of private investors are based overseas, reflecting significant foreign investment flowing into the UK
  • For every £1 invested by UKI2S public partners, a return of £25 is achieved in private sector investment, underscoring the fund’s effectiveness in driving growth
  • UKI2S-supported companies have created over 1,100 high-quality jobs, with an average salary exceeding £50,000, boosting the nation’s employment landscape
  • In a commitment to the Government’s Levelling Up agenda, 50% of total investments have been made outside London and the Greater Southeast, promoting economic growth in other UK regions
  • An independent assessment of the economic and wider benefits of UKI2S in 2020 revealed that an impressive 75% of companies would not have started up without the support of the fund.

By investing in innovation from academia and public sector research – often as the first investor – UKI2S helps maximise the commercial value of research and innovation, bringing revolutionary ideas and technologies to market and driving economic gains from publicly funded research.

Investment decisions by the fund are guided by the potential societal impact of technologies and the possibility of financial returns, focusing on key areas such as engineering biology, defence and security, fusion energy and UK public sector knowledge assets, including intellectual property, innovation and data.

Coupled with their latest injection of funding, UKI2S also welcomes the Medical Research Council (MRC) as a new public fund partner. MRC joins UKI2S as a representative of UKRI.

MRC’s expertise in funding medical research, from fundamental lab-based science through to clinical trials, to improve human health will add an important dimension to the activities of UKI2S.

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