British Business Bank makes cornerstone investment into Northern Gritstone’s £20m rolling close
Northern Gritstone, the groundbreaking life sciences and deeptech venture capital firm, has announced its rolling close of £20m of additional ordinary share commitments. The investment comes from existing Northern Gritstone shareholders, including the British Business Bank as cornerstone investor, increasing their respective commitments to the Company. The British Business Bank often makes cornerstone investments, mobilising further institutional capital by providing a signal of confidence in the fund.
This close builds on the firm’s April 2025 close of £362m permanent capital, taking it to £382m Over the course of 2026, Northern Gritstone is seeking to raise additional capital and the close marks the start of that programme. £10m of the new funding commitment comes from the British Business Bank, bringing its total investment in Northern Gritstone to date to £40m. Further investors include Andrew Law, CEO of hedge fund Caxton Associates.
Active since May 2022, Northern Gritstone is seizing the North of England’s innovation opportunity, investing in and scaling at speed deeptech and life sciences startups that solve global problems, with the potential to scale worldwide. The company has already made 51 investments in some of the most exciting areas of development and future job creation in deeptech and life sciences, including semiconductor design and manufacturing; novel materials; secure computing; AI; healthtech; and gene therapies.
Many of its portfolio companies are spinouts from the Northern Arc universities of Leeds, Liverpool, Manchester, and Sheffield, which combined generate close to £800 million in research funding annually, 92% of which is world-leading or internationally excellent. The Northern Arc universities represent one of four globally competitive centres alongside Oxford, Cambridge and London, which together form the UK’s Technology Diamond.
The British Business Bank is the largest investor in UK venture and venture growth capital funds. This commitment highlights the Bank’s continued support for the Northern Growth Corridor and the UK’s thriving spinout ecosystem. Between 2022-2024 almost a quarter (24%) of university spinout deals were supported by the Bank, demonstrating its significant role in supporting the commercialisation of cutting-edge scientific research.
Northern Gritstone chair, Lord Jim O’Neill, said:“We are very grateful for this further support from the British Business Bank and Andrew Law to continue developing global businesses in the North of England originating from our ‘Northern Arc’ university ecosystem. In this way, investors are contributing to future higher value-added activity and the North’s productivity”
Northern Gritstone chief executive, Duncan Johnson, said:“This strong start to Northern Gritstone’s rolling close in today’s challenging fundraising environment shows the belief in innovation coming from the North of England. The region is now an integral part of the UK’s Technology Diamond, and we are proud to support the incredible talent of the North, helping to commercialise groundbreaking research into internationally commercial businesses.”
Christine Hockley, managing director and head of Commercial Equity Funds, British Business Bank, said: “The UK’s universities are a powerhouse of breakthrough research, and Northern Gritstone plays a vital role in transforming world‑class research from the North of England into high‑potential, IP‑rich businesses. Our increased commitment reflects the Bank’s ambition to scale life sciences and deeptech businesses, which are critical to the UK’s future growth.”