Investment grants trigger £5m follow-on funding
Recipients of startup grants from an investment fund at Cambridge Judge Business School have collectively raised more than £5 million since the grants, ranging from £3,000 to £20,000 were first awarded 18 months ago.
The early, unconditional grants have helped these ventures gain credibility among investors, and to pay for a variety of startup costs to get the companies off the ground.
The Investment Fund for early stage ventures was established at Cambridge Judge through an anonymous benefactor of 500,000 euros (about £400,000) and made its first grant of £15,000 in December 2013 to geopolitical risk analytics firm Cytora – which has completed a successful seed round of funding and is in the process of completing its next funding round.
Like all recipients of the Investment Fund grants, Cytora has participated in the Accelerate Cambridge programme that mentors start-up ventures through several stages of development.
Other such recipients have included giftgaming, an in-game advertising company; KisanHub, a farm-management software firm; Media Gamma, an online advertising futures and options exchange; AlgoDynamix, a financial risk-analytics software firm; SensorHut, an optical chemical-sensing company; and Healx, which finds novel uses for drugs to address rare diseases.
Funding commitments to date among companies receiving Investment Committee grants include: £300,000 for Cytora, £375,000 for Media Gamma, £300,000 for AlgoDynamix and £250,000 for SensorHut.
The Investment Fund is administered by a committee chaired by Sir Paul Judge, an original benefactor of Cambridge Judge Business School, which decides which applicants are awarded grants and the amount provided. So far, 17 grants have been awarded totalling nearly £200,000.
“These grants are awarded to ventures that are at such an early stage of development that they don’t yet quality for proof-of-concept funding, but having worked with them at Accelerate Cambridge we recognise their potential and talent,” says Hanadi Jabado (pictured), director of Accelerate Cambridge.
“These grants are given with no strings attached and we take no equity in the ventures.”
Jeremy Sosabowski, co-founder of AlgoDynamix, says the grant received from the investment committee enabled the venture to pay for legal costs to set up the company, conduct primary market research and other launch activities.
“We most certainly achieved a higher valuation through refining the venture’s value proposition through the investment committee grant,” says Jeremy. “In fact closing the seed round would have been very difficult without this grant.”
Rael Cline, CEO of MediaGamma, says the grant “propelled us forward by half a year and allowed us to gain critical insights at an early stage,” while Giles Baker, co-founder of KisanHub, said the grant “gave our shareholders external validation of our founding team and our business.”
Marc Stettler, co-founder of SensorHut, said the grant helped purchase a key piece of equipment essential for the firm’s research and development. “Without this instrument, we would not have been able to do any evaluation of the technology or have any results to show potential investors or customers,” he says. “We would not have been able to afford this on our own so this really was a key enabler.”
• For more information about the grants, contact Hanadi Jabado at h.jabado [at] jbs.cam.ac.uk (subject: Investment%20Fund%20grants)