The bank will provide up to £65m as cornerstone capital, with the fund intended to attract additional investment from private investors while working alongside organisations including Scottish Enterprise.
Some £15m will be earmarked for an “Ignition Strategy”, providing between £250,000 and £1.5m to businesses at the pre-seed and seed stages. The remaining £50m will support an “Accelerator Strategy”, contributing to larger funding rounds of between £2m and £8m for companies seeking to scale.
The two-stage approach is intended to provide funding at different points in a company’s development, from the initial commercialisation of university research through to larger investment rounds needed to expand.
David Ritchie, chief executive of the Scottish National Investment Bank, said the country produces significant research and entrepreneurial talent but founders could struggle to obtain the funding and business support required to commercialise their work.
“The Scottish Universities Fund is designed to help address that gap and create stronger pathways for ambitious companies to start, scale, and stay in Scotland,” he said.
“Our ambition is not simply to provide capital. It is to help build a stronger innovation ecosystem, attract additional private investment and ensure more of the value created by Scottish innovation is captured here in Scotland.”
The fund follows a recommendation contained in Scotland’s National Innovation Strategy, which sought ways to increase the economic impact of research undertaken by Scottish universities.
Sir Jim McDonald, emeritus principal of Strathclyde University and co-author of the strategy, said Scotland had “all the ingredients needed to be a leading innovation nation”, but needed to translate more university research into successful businesses.
“The challenge has always been ensuring more of that excellence is translated into successful businesses and economic impact,” he added.
The bank said Scotland’s universities account for 12% of UK research output despite the country having around 8% of the UK population. Unlike other parts of the UK, Scotland does not currently have a dedicated university investment fund.
The initiative is also intended to help university-backed companies remain in Scotland as they grow, reflecting the fund’s stated aim of helping businesses to “start, scale and stay” in the country.
Universities will not be required to contribute money to participate. Instead, they will become strategic partners, helping to identify potential commercial opportunities and build a pipeline of businesses seeking investment.
The fund will not be restricted to particular industries, although potential investments are expected to reflect areas of Scottish research strength, including health and life sciences, the energy transition, data and digital technologies and advanced manufacturing.
Innovation, Technology and Tertiary Education Minister Alyn Smith is due to attend tonight’s launch.
“By working with the bank and our universities to draw in private capital, we are helping more of Scotland’s research become high-growth companies that start, scale and stay here,” he said.
The launch at the bank’s Edinburgh office will bring together university leaders, founders, investors and government representatives.
