A new £300 million spin-out focused investment vehicle aims to catalyse the creation and growth of science and technology companies addressing global challenges.
The SETsquared Partnership universities – Cardiff, Bath, Bristol, Exeter, Southampton and Surrey – and leading regional investment firm QantX have announced plans for the investment vehicle, saying it would drive a ‘much needed step change in early-stage patient capital, expertise, and support’.
It will be available to university spin-outs and start-up 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 has a research portfolio of over £600 million and has produced over 230 spin-out companies through collaboration across regional innovation ecosystems. Despite this success, 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, says the Partnership. Startups in the region raise, on average, five times less at early stages than in the ‘Golden Triangle’ – London, Oxford and Cambridge.
SETsquared added that, as demonstrated by successful models elsewhere in the UK and internationally, this new vehicle will 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.
QantX is on a mission to bring modern economic success to the region by increasing the number of spin-outs, protecting intellectual property, and creating long-term impact. They have a track record of backing the most ambitious science and technology founders – including award-winning teams at Senisca, Ensilitech, iFAST Diagnostics, and Neuronostics – and developing connections across university innovation ecosystems.
SETsquared was recently ranked by the Financial Times and Sifted as one of the top three start-up hubs in Europe. The partnership brings the pipeline and track record from working with over 400 ventures per year in critical technologies such as AI, engineering, biology, semiconductors and quantum, with members securing over £5 billion in investment and creating over 15,000 jobs since 2002.
Richard Haycock, Co-Founder & CEO, QantX, said:
“While the UK ranks fourth globally in cutting-edge research and innovation, we’ve often struggled to commercialise these breakthroughs. Our partnership with the SETsquared universities aims to change this in the South and South West. We’re witnessing a surge in university spin-outs led by brilliant founder entrepreneurs.
“By connecting these visionaries with risk capital and expertise in transformative fields like life sciences, sustainability, and deep tech, we’re cultivating a thriving innovation ecosystem. This collaboration will accelerate economic growth, create high-skilled jobs, and deliver returns for our investors. We’re not just funding companies; we’re empowering local entrepreneurs to transform our region into a powerhouse of innovation, ensuring the fruits of our world-leading research flourish right here at home.”
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”.
Science Minister, Lord Patrick Vallance said:
“The UK is home to brilliant innovators, and this investment vehicle that brilliant innovators, and this investment vehicle that brings together six universities with a private sector investment firm, QantX, will help turn great ideas into thriving companies that create high-skilled jobs and exciting new products.”
