The British Business Bank contributed £19 million to a £225m Series C round which valued PhysicsX at £1.8 billion.
The UK company is developing and deploying its AI-native engineering platform to accelerate hardware innovation and drive engineering and manufacturing productivity in industrial organisations.
The firm is headquartered in the United Kingdom, with offices in London and New York, and an expanding presence in San Francisco’s Bay Area and Singapore.
The round was led by Temasek, with participation from new investors M&G Investments and Intrepid Growth Partners, alongside existing investors including Applied Materials, Atomico, General Catalyst, July Fund, NGP, NVIDIA, Radius and Siemens.
It also included the fourth investment made the British Business Bank’s British Growth Partnership Fund I since its £200m first close.
The BBB said M&G Investments’ contribution demonstrated how the British Growth Partnership’s co-investment model can bring additional pension fund capital into UK venture. Pension funds can increase exposure to fast-growing UK companies while businesses can tap into large pools of domestic institutional capital, it said.
The sectors that build the world’s most critical hardware — aerospace & defense, energy, semiconductors, automotive, materials manufacturing, data centres — are under more pressure than ever to ship better products on tighter timelines. However the simulation workflows at the heart of hardware development are slow, expensive and difficult to scale.
PhysicsX says its software stack is built to remove this bottleneck. Its AI models predict physical behaviour in seconds rather than hours or days, enabling engineering teams to evaluate orders of magnitude more design variants and carry physics insight across the full product lifecycle.
The financing comes amid rapid growth. PhysicsX has doubled year-over-year recognised revenue, tripled booked revenue, while more than doubling its customer count over the past year. The team has grown to more than 300 people, doubling in size in the last 12 months.
This round will accelerate the company’s global growth, the expansion of its platform capabilities, and frontier research, including the development of larger, more powerful pre-trained physics AI models, known as Large Physics Models.
Charlotte Lawrence, managing director and head of direct equity at the British Business Bank, said: “PhysicsX is redefining how complex products are designed and built. Their platform combines world-class engineering heritage with frontier AI capability to create a company that we believe can be a global leader.
“As their technology is adopted by the world’s top industrial companies, we are thrilled to back their continued expansion whilst also allowing UK pension owners to share in the success of a true global innovator.”
Ian Connatty, managing partner of the British Growth Partnership and deputy CIO of the British Business Bank, added: “The British Growth Partnership was created to connect pension funds with the UK’s fastest growing companies.
“This transaction shows that model in action, and that we have built a platform for domestic pension fund capital to flow into the UK’s technology leaders.”
In addition to PhysicsX, British Growth Partnership Fund I has invested in Wayve, Elliptic and Draig Therapeutics.