Key Cambridge VC Unveils $126M Fund to Support Later Stage Startups
The UK and Europe have long been criticized for their lack of substantial growth funding for later-stage startups, particularly when compared to the thriving ecosystem in the US. Recent data from the European Investment Fund reveals that the US boasts at least seven times more large-scale venture capital (VC) funds than Europe. In this context, the launch of a new growth fund in the UK is a noteworthy development.
Introducing the Cambridge Innovation Capital Opportunity Fund
Cambridge Innovation Capital (CIC), which focuses on investments within the Cambridge ecosystem surrounding the prestigious University of Cambridge, has unveiled a significant new initiative: a £100 million ($126 million) Opportunity Fund. This fund is primarily aimed at providing growth capital to later-stage startups in the deep tech and life sciences sectors.
Key Features of the Opportunity Fund
- The fund is supported by Aviva Investors and British Patient Capital.
- It plans to invest up to £20 million ($25.2 million) per investment into growth-stage companies.
- Current investments include Pragmatic Semiconductor, a leading chip manufacturer, and Riverlane, a quantum computing firm.
With CIC managing $757 million across over 40 companies, its strategic partnership with the University of Cambridge enhances its position in the market.
Addressing the Funding Gap for Startups
The establishment of the CIC Opportunity Fund aims to tackle the persistent funding gap for later-stage startups in the UK, which often leads to a migration of these companies to countries like the US. This initiative aligns with the UK government’s recent announcement of an “AI Action Plan”, designed to bolster the economy through artificial intelligence and to cultivate a European equivalent of Silicon Valley.
Government Support and Future Prospects
As part of the “Golden Triangle” initiative, which links London, Oxford, and Cambridge, the UK government has committed £14 billion in funding to enhance connections between five leading universities and foster tech ecosystem growth.
Andrew Williamson, Managing Partner at CIC, noted that while the organization traditionally focused on early-stage investments, many companies are now transitioning to proven technologies and require capital for later-stage funding rounds. He emphasized that this fund was created to facilitate direct investments, a necessity identified by the British Business Bank to address the scale-up capital gap.
Successful Exits and Future Investments
The CIC has a strong track record of successful exits, including:
- The sale of Gyroscope Therapeutics to Novartis for $1.5 billion.
- The acquisition of PetMedix by Zoetis for $285 million.
- The sale of Inivata to NeoGenomics for $390 million.
- The exit from Audio Analytic, a sound recognition technology firm.
Cambridge is renowned for producing industry leaders such as ARM Holdings, Abcam, Darktrace, and Bicycle Therapeutics, and the new Opportunity Fund is poised to support the next generation of innovative companies.
For more insights into the evolving startup landscape in the UK, visit our Startup Ecosystem page.
