Compared to the US, the UK and Europe have long struggled with a lack of substantial growth funding for later-stage startups. According to data from the European Investment Fund, there are at least seven times more large-scale VC funds in the US than in Europe. In response, Cambridge Innovation Capital (CIC) has honed in on the Cambridge ecosystem and launched a new “Opportunity Fund” worth £100 million (equivalent to $126 million).
Why Is This Move Important?
● Purpose and Prospects:
CIC primarily invests in companies around Cambridge and its renowned university. Now, the aim is to expand their portfolio by adding growth-stage deep tech and life sciences companies.
● Backers:
The fund is supported by Aviva Investors and British Patient Capital, which further strengthens its credibility.
● Investment Examples:
Pragmatic Semiconductor: A leading company in chip design and manufacturing that has raised $389.3 million so far.
Riverlane: A company specializing in quantum computing error correction that has secured $120.7 million.
● Investment Terms:
The new fund will allocate up to £20 million (or $25.2 million) per investment round for later-stage financing of deep tech and life sciences companies. This strategic move is designed to prevent local startups from moving abroad, primarily to the US.
The Role of the UK Government:
This funding gap has prompted the UK government to take action as well. Under the recently announced “Artificial Intelligence Action Plan,” the government is considering measures to boost AI and technological innovation, as well as strengthen the tech ecosystems around the famed Oxford and Cambridge universities. Additionally, plans are underway to enhance the financing and transportation networks within the “Golden Triangle” area—which includes London, Oxford, and Cambridge—through a £14 billion funding package.
This new fund is expected to be a key foundation for supporting local innovative projects and boosting global competitiveness. Not only will this development expand growth opportunities in Cambridge, but it could also trigger revolutionary changes in both technology and the economy across Europe in the future.
