Welcome to the latest edition of the DIGIT Deal Roundup.

As we enter Spring, Scotland’s tech sector is seeing some big funding wins in medtech, the energy sector, and the broader innovation economy.

For a recap on those standout stories, here’s our round-up.

Funding and Investments

Glasgow Uni Gets £4.9M for “World-leading” Electron Microscope

A new grant will support the creation of a “world-leading” electron microscopy facility at the University of Glasgow.

The UK’s Engineering and Physical Sciences Research Council (EPSRC) has awarded £4.9 million in funding to the University of Glasgow to build a new electron microscopy facility for materials science.

Researchers from the university’s School of Physics and Astronomy have long-standing expertise in the study of functional materials, including the magnetic films used for data storage, materials for energy applications, and semiconductor technologies.

The new microscope, named MagTEM2, will help support materials projects across the university, and will also be accessible as a facility to national and international users from 2026.

Read more here. 

Scots Dental Biotech Firm Secures £5M Funding Boost

Calcivis, the Edinburgh-based biotechnology firm, has secured £5 million in new funding to roll out its early tooth decay detection tech.

The latest investment round was led by £4m of funding from the Scottish National Investment Bank (SNIB), along with £1m from IFS Maven Equity Finance, which is managed by Maven Capital Partners and is part of the Investment Fund for Scotland (IFS), delivered by the British Business Bank.

The Scots firm’s patented system uses a biological diagnostic agent in combination with an imaging device to enable the early detection of tooth decay, which can then lead to earlier preventative treatment for dentistry patients.

Read more here. 

Glasgow Biotech Company EnteroBiotix Lands £27M Funding Round

The Glasgow-based biotechnology firm announces the completion of a £27 million funding round. 

This substantial financial boost, backed by both new and existing investors, marks a significant milestone for the company as it looks to improve the landscape of microbiome therapeutics.

The funding round was made up of £15.7m in equity funding, as well as the conversion of £11.6m in loan notes into equity. 

The round saw contributions from seasoned life science investors Thairm Bio and Kineticos Life Sciences, alongside the Scottish National Investment Bank (SNIB). Additionally, existing investors such as Scottish Enterprise and several private investors reaffirmed their commitment.

Read more here.

Scots Hydrogen Energy Startup Secures £1M Investment

Glasgow-based hydrogen energy startup, Clyde Hydrogen, secures over £1 million in pre-seed funding.

The Scottish startup is a spinout from the University of Glasgow, and provides hydrogen production solutions to reduce carbon emissions. It closed its pre-seed round of over £1m in equity and grants, led by Zinc, the University of Glasgow, and strategic angel investors.

The collaboration with the University of Glasgow will allow Clyde Hydrogen to gain access to world-class research facilities and expertise in renewable energy technologies. While Zinc, an early-stage mission-driven investor, will add strategic investment insight and a network of industry connections to the mix.

Clyde Hydrogen’s decoupled electrolyser technology promises to deliver high-pressure green hydrogen safely at scale and at a reduced cost. This innovation has the potential to align renewable energy with hydrogen production more efficiently than current methods, addressing a longstanding challenge in the industry.

Read more here. 

New Edinburgh Uni Medtech Spinout Launches With £10M in Backing

Lung cancer could be spotted and treated more quickly thanks to a €12 million (£10m~) investment in technology aiming to diagnose and treat disease in just minutes.

The investment has led to the launch of Prothea Technologies Ltd., a spinout company from the University of Edinburgh and Bath, which is developing tech to “see and treat” diseased tissue in a single procedure.

Financing for Prothea was co-led by European firms Earlybird Venture Capital and Mérieux Equity Partners, with participation from NRW Bank as well as Old College Capital, the University of Edinburgh’s venture investment fund.

The team behind Prothea say that its technology could cut hospital pressures and waiting times, and pave the way for diagnosis and treatment to be carried out in one hospital visit.

Read more here. 

Scots SpaceTech Orbex Secures £16.7M Investment

With pre-launch testing underway, the funding will help Orbex ramp up the development of Prime, its 19-metre long, two-stage rocket designed to transport small satellites into Low Earth Orbit. The aim is to ensure full readiness and scalability for its launch period.

Orbex now has two active patents in a number of European countries and the United States covering various parts of its rocket technology.

IIt is powered by a renewable biofuel, which allows the rocket to reduce carbon emissions significantly compared to other similarly sized rockets being developed elsewhere around the world.

Phillip Chambers, CEO of Orbex, said: “Orbex is one of only two space rocket manufacturers in the UK, and the only one to also operate its own spaceport. Our technology is pivotal in making the UK a hub for European orbital launch, and we are entering a critical phase of development.

“We are building a sustainable, cost-effective launch vehicle to compete with the best of Europe’s spaceflight manufacturers. This additional funding will support our goal to push on into an operational launch phase and scale our business when the time comes.”

Read more here. 

Scots HealthTech Phlo Raises Additional £9 Million

Phlo have announced the close of a £9 million funding round, accessing additional investment for their group of businesses amid a challenging investor market.

The new capital will power significant scaling of the digital healthcare business, and its evolution from a digital pharmacy into a ‘holistic digital healthcare leader.’

The raise comes at a difficult time in the market, where investment in digital health startups has declined year-on-year since 2021. However, Phlo’s in-house technology stack and commitment to digital-first patient care and health outcomes has been a major driving force in investment confidence.

This latest round of financing comes 14 months after the completion of Phlo’s £10m Series A round, and 12 months after Phlo’s acquisition of the assets of their former competitor, TruePill UK. It follows a year of robust business growth and scale across multiple verticals and the launch of several major new products across women’s health, weight management and on-demand prescribing services.

Read more here. 

UK Gov Shores Up AI Boats With New £8M Fund

The UK government has launched its new Smart Shipping Acceleration Fund today—an £8 million programme aiming to put the UK at the forefront of cutting-edge maritime technology.

Maritime minister Lord Davies is in Southampton to announce the fund, which will help kickstart feasibility studies to develop smart shipping tech such as autonomous vessels.

Proposals for automated port systems to help them detect safety hazards, optimise activities, and reduce environmental footprint are also eligible to receive the financial support.

The fresh batch of funding comes from the wider £206 million UK Shipping Office for Reducing Emissions (UK SHORE) programme, which was announced in March 2022.

Read more here. 

£5 Million Investment Fund for Scots Small Businesses

The British Business Bank’s Investment Fund for Scotland has agreed £5 million of deals to support the growth of small businesses, six months since the fund was launched to improve access to finance and provide a boost to the Scottish economy.

The milestone comes as five new debt funding deals – managed by FSE Group – have been confirmed to give businesses in the drinks, healthcare, recruitment, and creative industries access to funding for growth.

Cosmetic surgery group, Elanic Clinic; oat milk cocktail brand, Panther M*lk; life sciences recruitment firm, Entrust Resource Solutions; graphic design consultancy, John Young Group; and a whisky labelling business have collectively secured £3.25 million of loans from the fund.

Earlier this year, the Bank announced the first equity deals from the Investment Fund for Scotland through fund manager Maven Capital Partners, supporting med-tech firms Carcinotech and Calcivis, while Kedras Clinics benefitted from the first loan from the fund via DSL Business Finance.

Read more here.

Scots MarTech Hyble Secures £2.8 Million Funding Round

UK and Ireland growth capital investors BGF, has announced a £2.5 million follow-on investment in Edinburgh-based Hyble, a provider of marketing technology to the global drinks and hospitality sector, as part of a £2.8m funding round.

The funding will be used to capitalise on momentum stemming from Hyble’s successful US launch and the recent signing of a multi-year contract with beverage alcohol distributor, Southern Glazer’s Wines and Spirits (SGWS).

Hyble’s expansion into the USA has driven 73% year on year revenue growth in Q1, and the growth of Hyble’s team across the UK and US, to almost 100 people in the past year.

Craig Letton, CEO at Hyble, said: “We’re pleased to secure this new funding at an important moment for Hyble’s long term growth trajectory.”

Read more here. 

Glasgow Medtech Nebu-Flow Secures £4.7M in Additional Funding

Nebu-Flow, the Glasgow-based medical device firm, has secured an additional £4.7 million of investment to help accelerate the next generation of inhaled drugs for patients with respiratory conditions.

The company’s nebuliser platform for respiratory drug delivery has been developed to provide a number of advantages over existing technologies, with the global market valued at over $1 billion (£798m~).

The funding round was led by SCVC, a UK-based venture capital firm investing in early-stage deep tech spinouts, and was supported by Scottish Enterprise, Foresight WAE Technology, SIS Ventures, Ascension, and Conduit EIS Impact Fund.

A former spinout, Nebu-Flow’s team has strong knowledge of inhalation drug delivery, with the company’s chair Dr John Pritchard having over 25 years’ experience in the field and previously working in senior roles for GSK, AstraZeneca, 3M, and Philips.

Read more here. 

Glasgow Tech Hub ‘thebeyond’ Secures £2.5 Million Investment

A new 10 year lease has been agreed and ‘thebeyond’ will open in March in two suites in Glasgow’s Skypark extending to around 20,000 sq ft.

Federated Hermes has announced the investment of £2.5m in ‘thebeyond’, a new European technology hub created by Smart Things Accelerator Centre (STAC), enabling Scottish Internet of Things (IoT),  from drones and robotics brands to compete globally.

Federated Hermes has invested significantly in the scale up and is now enabling STAC’s vision for ‘thebeyond’, applying its ‘urban placemaking expertise’ to develop a major European technology centre on site in the coming two years, closely linked with local universities as well as wider industry.

A new 10 year lease has been agreed and ‘thebeyond’ will open in July in two suites in Glasgow’s Skypark extending to around 20,000 sq ft.

Read more here.

Acquisitions

Abrdn Sells Private Equity Business for up to £100M

Abrdn, the Edinburgh-based financial services company, has completed the sale of its assets – totalling £7.4bn – under management private equity business to Partia Investment for up to £100m.

Following a strategic review of the groups’s alternative businesses, the sale was conducted after it was found that the capital generated from the sale of certain private equity businesses would be better deployed within the core investment business.

Rene Buehlmann, chief executive of investments at abrdn, commented: ”The sale of our European-headquartered private equity business to Patria Investments follows the sale of our US-headquartered private equity business to High Vista Strategies last year and marks another step forward in our efforts to reshape and simplify our Investments business.”

Read more here. 

Darktrace to Be Acquired by US Private Equity Group for £4.3 Billion

UK cybersecurity and AI company Darktrace has agreed a $5.3bn (£4.2bn) sale to US private equity business Thoma Bravo.

Darktrace, whose co-founding investor Mike Lynch is currently on trial for fraud and conspiracy in the US, agreed to an offer 44% higher than its average share price over the past three months.

In a statement to investors, the Darktrace board said that its “operating and financial achievements have not been reflected commensurately in its valuation, with shares trading at a significant discount to its global peer group”.

The comment will fuel fears that the FTSE is haemorrhaging prestigious company listings to the US, in search of greater fundraising potential. Recent departures include the chipmaker Arm Holdings, the gambling company Flutter, and the building materials business CRH.

Full story here.