Ahren, an innovative fund backed by eight of Cambridge’s best known scientists and engineers, has raised $250m (£196m) to invest in companies aiming to create new technologies with large market potential.
The scientists hope the fund will help to ease the shortage of capital for innovative start-up companies in the UK compared with the US. It follows Cambridge Innovation Capital’s recent £150m funding round and the emergence of the medical charity LifeArc as an investor.
“There is enormous potential here to create really exciting and innovative new companies but we have not had the level of capital needed to support them,” said Alice Newcombe-Ellis, Ahren’s founder.
A wide range of investors have put money into Ahren, from established European companies such as Unilever, Aviva and Sky to billionaire businessmen such as André Desmarais of Canada and Carlos Rodriguez-Pastor of Peru.
The fund will invest in what Ms Newcombe-Ellis called “the intersection of deep science and deep technology — fundamental advances that also have great commercial potential.” Its four broad fields of activity are the brain and artificial intelligence, genetics and biotechnology, space and robotics, and energy efficiency.
Ms Newcombe-Ellis, a mathematician turned investor who has worked at TPG Capital and Lansdowne Partners, enlisted eight senior Cambridge professors as Ahren’s “science partners”. They include Martin Rees and Venki Ramakrishnan, past and present presidents of Britain’s premier scientific body, the Royal Society.
Another partner is Shankar Balasubramanian, the chemistry professor who invented what has become the main technology used to decode DNA. He said the eight scientists were closely involved in evaluating potential investments and identifying future targets.
“Alice has done a remarkable job pulling our group together,” Sir Shankar said. “Most of us knew one another in Cambridge but without her we would never have organised ourselves in this way to help create great enterprises on a really long-term basis.”
Investors aim to get more than financial returns from their involvement with Ahren. Sky, for example, has previously taken stakes in individual tech companies but not in a science-led fund like Ahren, said Andrew Griffith, the broadcaster’s chief operating officer.
“The main thing that appeals to us is that we gain exposure to some of the big scientific breakthroughs in fields such as quantum computing that are just over the horizon but will affect our industry,” he added. “It also appeals that together we are investing in the uk.”
Ahren is set up as a limited liability partnership (LLP) in which the partners include individual and corporate investors. Ms Newcombe-Ellis said the fund was oversubscribed, “so we were able to choose investors who were aligned with our values and might provide customers for the entrepreneurs we are funding.”
So far the fund has invested about $35m in six companies, at various stages of development. It has an investment team of five people in Cambridge and London, working with the eight science partners.
According to Ms Newcombe-Ellis, the closest equivalent fund is Lux Capital in New York.
Ahren took part in the £200m fundraising by Graphcore, the Bristol-based developer of special chips for artificial intelligence computers, and is leading the seed funding of Mogrify, a new Cambridge biotech company developing chemicals that can transform any mature human cell type into any other without having to produce stem cells as an intermediate step.
Ms Newcombe-Ellis is particularly excited about the company. “It is really in our sweet spot,” she said. “Mogrify’s technology will make it possible to develop new cell therapies across a huge range of therapeutic areas.”
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