Matter Machine, an AI-driven materials discovery company spun out of the University of Liverpool, has raised £4m in a pre-series A funding round led by IP Group and appointed Gordon Sanghera, the former chief executive of Oxford Nanopore, to run it.
The round was supported by Northern Gritstone, the investment company that backs technology businesses emerging from universities in the north of England. IP Group, the FTSE 250 investment company, was also a backer of Oxford Nanopore.
Sanghera has stepped down as chief executive of Oxford Nanopore, the Oxford University spin-out he led for more than two decades, from its inception in 2005 through a £3.4bn float in 2021. He joins Matter Machine as chief executive.
The company has been founded to commercialise the research of Professor Matt Rosseinsky, who is its chief scientific adviser. It plans to develop AI-powered materials discovery technologies that accelerate the identification and optimisation of novel materials, with the aim of reducing the time and cost of innovation across industries.
Matter Machine is based at the Materials Innovation Factory, a collaboration between the University of Liverpool and Unilever, the FTSE 100 company. The university describes the facility as purpose-built for materials innovation, offering automated laboratory equipment and academic expertise in materials chemistry and formulation.
Sanghera said: “Materials innovation underpins progress across multiple sectors from energy to manufacturing and electronics.”
He is pursuing partnerships with industry and will seek to raise further funds for the business.
“If we were American, we would have just gone out and raised £20m to £30m in one hit,” he said. “But knowing how British funding works, we’ll breadcrumb it. That’s not a bad thing.”
There is almost four times more private funding for start-ups in the US than in the UK, a gap that widens to nine times for investments above £100m, according to figures from the government’s Council for Science and Technology cited in a Business Matters report on where UK spin-out venture capital goes.
Rosseinsky said: “The combination of advanced materials science and artificial intelligence creates a powerful opportunity to transform how new materials are discovered.”
Greg Smith, the chief executive of IP Group, said the new venture could “dramatically shorten the time required to develop new materials, accelerating innovation across batteries, catalysts and advanced manufacturing”.
Northern Gritstone is chaired by Lord O’Neill of Gatley, a former chief economist at Goldman Sachs. He worked with Andy Burnham when the prime minister was mayor of Greater Manchester and has informally advised him.
The firm has invested in 51 companies since launching in May 2022, it said on 23 April, when it announced a £20m rolling close anchored by the British Business Bank that took its permanent capital to £382m. Many of its portfolio companies are spin-outs from the universities of Leeds, Liverpool, Manchester and Sheffield.
Oxford, Cambridge and London produced almost half of the UK university spin-outs founded between 2013 and 2024 and attracted two-thirds of the venture capital that went into the sector, according to a review by Tony Hickson published by UK Research and Innovation on 3 February.
The Capital Markets Industry Taskforce has separately told John Healey, the chancellor, that Britain risks becoming an “incubator nation” that creates companies and then loses them to other countries.
