A new investment fund has been created to help Cambridge University start-ups commercialise their innovations and take them from lab to market.
Cambridge Innovation Capital (CIC) plans to invest £50 million in promising university spin-outs and other early stage technology companies over the next three years.
Those behind CIC say the fund has been set up with the help of Cambridge University to provide long-term finance that will help Cambridge spin-out companies across the so-called 'valley of death', the crucial moment when a company requires significant investment to grow.
“Many good companies have to spend too much time fundraising, leaving them with less time to focus on running their business,” said Edward Benthall, CIC’s non-executive chairman. “CIC will work with angel and other long-term investors to bring innovative technologies to market and help build world-class businesses.”
The lead investors in the fund are Invesco Perpetual and Lansdowne Partners, with further capital provided by the Cambridge University Endowment Fund, ARM Holdings and IP Group.
“The university benefits society through the pursuit, dissemination, and application of knowledge. Today we are furthering that mission by partnering with experienced investors, innovators and managers to help the early stage technology companies of today become the great businesses of tomorrow,” said Cambridge University vice-chancellor, Sir Leszek Borysiewicz.
“With the launch of CIC, the university and our co-investors are taking an important step in supporting the continued economic growth of the region and the country,” added Borysiewicz.
Cambridge University will also support CIC through its commercialisation arm, Cambridge Enterprise.
Cambridge vs Tech City
While the area around London’s Old Street Roundabout is proving to be very popular with tech start-ups, some argue that Cambridge is the real centre for UK technology due to the number of large tech companies it has spawned, including Autonomy and ARM Holdings.
Mike Lynch, the founder of Autonomy, recently set up his own technology fund in the form of Invoke Capital. Last month the company announced that it was making its first investment in a Cambridge-based cyber security start-up called Darktrace, in a testimony that further supports the Cambridge technology scene.
Cambridge software start-up RealVNC is tipped to become the UK’s next billion dollar technology company and won the prestigious Royal Academy of Engineering MacRobert Award earlier this year.
RealVNC’s software allows computer, smartphone, and other device users to remotely take control of another device from anywhere in the world. This means IT workers can solve problems on people’s computers or smartphones without having to leave their own desk, for example.
“Tech City is a new kid on the block, with nothing significant to show yet, and with no emphasis on core technology,” RealVNC founder and CEO Andy Carter told Techworld.
“RealVNC is part of the Cambridge Cluster. This has been going for 60 years or more, has 1,500 high-tech companies, 12 billion dollar turnover companies, and 50,000 high-tech jobs. It is the most significant technology cluster in Europe. There are plenty of companies who are going for the big-time and who are not interested in acquisition."