Context
In a previous blog, we introduced our aim to improve investment for small and medium enterprises (SMEs) who are transforming food production. In a nutshell, sole SMEs apply to TFP to fund their project idea, while simultaneously looking for private investment at least twice the level of the TFP grant.
Only when the investment is aligned can the grant be secured, so the TFP series A investor partnership programme was born.
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The cliffhanger of the story was whether the scheme would work as planned, so we were delighted to be able announce that the competition was a resounding success.
Seven SMEs have been supported with a total of £5.6 million in grants, above our original £5 million budget, showing the high quality of applications we received. This has leveraged aligned private investment of over £16 million, meaning the combined generation of a more than £20 million investment boost for the sector.
The outcome
And this success was not simply from one or two projects. Seven of our 11 lead investors identified potential investment and tailored a deal from the 31 companies who passed the TFP project requirements. All deals included syndication from outside our pool of lead investors, with many new and existing investors participating through the syndication opportunity.
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The portfolio of companies being supported will be announced individually, but it was so pleasing to see the breadth of technologies supported, that included:
- cultured meat production
- robotic harvesting
- data capture and prediction through artificial intelligence: be it diseases, pests or artificial insemination.
Ready for round two
The delight for me personally, is that the success of round one has enabled us to seek and receive approval for a round two, following the same scope and requirements.
This new funding opportunity will open for SMEs on 18 October 2021. Katrina Hayter, Challenge Director for TFP, will be announcing the launch of round two during the World AgriTech Summit being held on 28 to 29 September. She is ably supported by three of the SMEs who secured grant and investment from round one.
On top of this, it was exciting to see that the round one success was identified and highlighted in the National Food Strategy. A recommendation was made that at least £50 million should be available for schemes like this. We would of course relish the chance to deliver this ambitious level of investment going forward, but are equally delighted that TFP can support round two with £5 million.
We always endeavour to adopt lessons learnt, so round two will benefit from a face-to-face investment showcase event for invited SMEs, lead investors and the wider investor community. This will be held in London in January 2022, restrictions permitting, and will be at the same venue where the original Innovate UK Investor Showcases took place between 2017 and 2019, which was the catalyst for this programme.
We are also excited that the Investor Readiness Bootcamp training provided to successful SMEs in round one is now becoming accessible for all who are considering applications for round two.
This is one of the benefits of the virtual event, as the material is still pertinent and already captured, but now can be shared with a wider audience. This will ensure all SMEs who apply fully recognise the significance and requirements of securing private investment. It is not for everyone!
Sustaining the momentum
On a personal note, the most important feature of these developments is that funding through schemes like the investor partnership, that maximise public and private funding relationships, is an active talking point at all levels of the funding landscape.
Our ambition was never just to launch a single round of funding, but to sustain momentum for the Agrifood investment ecosystem for long-term growth and success.
Round two is another step forward, and we will be actively seeking how to continue this progress and build on the inevitable success of this and subsequent rounds.
Top image: Credit: Edwin Tan / Getty Images
Chris Danks is the innovation lead of the Transforming Food Production challenge at UKRI. Prior to this role, he was the transfer manager at Knowledge Transfer Network.