Six universities in the SETsquared Partnership are teaming up with regional investment firm QantX to launch a new £300 million spinout-focused investment vehicle.
The new investment vehicle aims to significantly boost the creation and growth of science and technology companies in the South and West ready to address global challenges.
The initiative was announced by Sir Richard Olver, chair of QantX, at Bristol City Hall on 11th October at the Regional Investment and Health & Life Sciences Summit, which Science Minister Lord Patrick Vallance and MP Darren Jones also attended.
The vehicle aims to drive a much-needed step change in early-stage patient capital, expertise and support available to university spinouts and startup companies in the region that are working in areas of true global impact – such as sustainability, clean energy and transformative healthcare.
Combined, the SETsquared Partnership of six universities – Bath, Bristol, Cardiff, Exeter, Southampton and Surrey – has a research portfolio of over £600m and has produced over 230 spinout companies through collaboration across vibrant regional innovation ecosystems.
However they say the potential impact of R&D to power regional growth and productivity is being held back due to significant imbalances in equity funding across the UK. Startups in the region raise, on average, five times less at early stages than in the Golden Triangle.
The new vehicle aims to open up significant co-investment opportunities, de-risk early-stage deep tech propositions for the VC and angel investment community and increase the overall amount of capital available.
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“The UK is ranked fourth globally for tech, digital, and science-based innovation, the sectors that drive a thriving modern economy. Yet historically, it has failed to turn its world-leading research into commercial success,” said Richard Haycock, co-founder & CEO at QantX.
“When it does, the benefit is often lost overseas. To accelerate economic growth and create high-skilled jobs, the UK needs to channel risk capital and business expertise into these high-growth, innovative sectors.
“This new investment company will address these challenges and ensure that vital innovations come to market more quickly, where they can create the most social, environmental, and economic impact.”
Marty Reid, executive director, SETsquared, said: “The potential scale and quality of science and technology companies emerging from across the SETsquared University clusters is a match for any ecosystem.
“Creating this new investment vehicle could be a vital step forward in addressing funding gaps we see today, and through a deep connection with our support ecosystem, could inspire a new generation of talent who will get technologies out of the lab and shape the industries of tomorrow.
“We are delighted to formalise our collaboration with QantX, who bring a wealth of complementary experience from global industry and finance and a shared ambition to build a truly world-leading regional ecosystem and an economy with innovation at its heart.
“Collaboration is key to what we are building, and we would be delighted to engage with the broader investor community and any stakeholders interested in playing a part as we move forward.”