Aviva joins backers of university spinouts vehicle Northern Gritstone

Aviva, the FTSE-100 insurance group and asset manager, is joining the list of backers ploughing millions of pounds into some of Britain’s most promising university spinout companies.

Sky News has learnt that Northern Gritstone, which is chaired by the former Treasury minister Lord O’Neill, will announce this week that it has landed £50m in new funding from a syndicate of pension funds and other investors.

Sources said £35m of the capital was being provided by Northern LGPS, the collective asset pool of the Greater Manchester, Merseyside and West Yorkshire pension funds, with an additional £15m from Aviva and Fulcrum Asset Management.

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The funding injection will take Northern Gritstone’s total permanent capital base to just over £360m, according to a statement provided by the company in response to an enquiry from Sky News.

Since its launch in 2022, Northern Gritstone has invested in dozens of early-stage companies spun out of universities in Leeds, Sheffield and Manchester.

As part of the £50m fundraising, Paddy Dowdall, assistant director of the Greater Manchester Pension Fund, is joining the Northern Gritstone board as a non-executive director.

The vehicle is focused on companies operating in fields such as deeptech and life sciences, including semiconductor design and manufacturing; novel materials; secure computing; AI; healthtech; and gene therapies.

“We are very grateful for this further support from investors in our journey to develop world winning businesses in the North of England originating from our university ecosystem and contributing to the future of higher value added activity and the North’s productivity,” Lord O’Neill said in the statement.

Duncan Johnson, Northern Gritstone’s chief executive said the fundraising provided evidence of “our ability to create the world-leading businesses of tomorrow based on world-class innovation that exists in the north of England”.

Its latest raise comes as a number of university spinout ventures in other areas of the UK are struggling to raise sufficient funding to get off the ground.

Ben Luckett, managing director, venture and strategic capital at Aviva Investors said: “University spinouts will help power innovation, drive tangible real-world impact, and support the UK to get ready for the future.”