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Northern Gritstone Opens San Francisco Office to Pull US Capital Into Its Northern England Spinout Portfolio

  • Writer: Shawn Jhanji
    Shawn Jhanji
  • Aug 18
  • 3 min read
For a deeptech or life sciences founder in Leeds, Liverpool, Manchester or Sheffield, the hardest part of scaling has rarely been the science. It has been getting a cheque of meaningful size from an investor who understands the sector and is prepared to back a second or third round without demanding relocation to London or the Bay Area first. Northern Gritstone, the investment company built to back spinouts from the North of England's universities, is now trying to close that gap from the other direction, by opening an office in San Francisco. Chief executive Duncan Johnson said the move is about giving Northern Gritstone's portfolio companies direct access to US capital, not as an alternative to their Northern roots but as an addition to them. "It means you can grow quicker, because the US is better at procuring, and their risk appetite for technology is higher," he said. "It allows us to recruit more talent into our businesses. UK companies trade at a discount in the US, and capital is good at finding opportunities. But you've got to make the effort to go and make it easy for them." What is changing Five of Northern Gritstone's portfolio companies, including Series B plus businesses Pragmatic Semiconductor, Iceotope and Phagenesis, already count US investors among their backers. Rather than leave that connection to chance, the firm's first move in the Bay Area will be to recruit a venture partner on the ground, whose job is to give the rest of the portfolio what a spokesperson described as a soft landing, meaning a network, capital and business development from day one, instead of a cold start. The rationale is backed by data rather than sentiment. Dealroom figures cited by the firm show that UK companies backed by American investors typically raise larger rounds earlier and grow revenue four times faster over the two years after investment than peers backed only by UK money. For founders building outside the traditional Golden Triangle of Oxford, Cambridge and London, that is a significant structural advantage to be locked out of by geography alone. Why the geography matters Northern Gritstone has been active since May 2022 and has made 50 investments across semiconductor design and manufacturing, novel materials, secure computing, AI, health technology and gene therapies. Many of its portfolio companies are spinouts from what it calls the Northern Arc, the universities of Leeds, Liverpool, Manchester and Sheffield, which between them generate close to 800 million pounds in research funding a year. Northern Gritstone positions the Northern Arc as one of four globally competitive centres in the UK's research base, alongside Oxford, Cambridge and London, describing its own portfolio as "rooted in the North, global in ambition." That framing matters because most of the public conversation about who gets overlooked by venture capital focuses on gender and ethnicity, categories that are, rightly, tracked and reported on. Geography is tracked far less often, despite being just as structurally significant. A founder building excellent deeptech in Sheffield does not lack for science. What they have historically lacked is proximity to the investors, and increasingly the international investors, who write the largest cheques earliest. A regional fund building its own bridge to that capital, rather than waiting for it to arrive via London intermediaries, is a practical answer to a problem this publication has covered repeatedly this year. What comes next The San Francisco office is a small move in absolute terms, a single venture partner hire rather than a new fund. Its significance lies in the model it repre

For a deeptech or life sciences founder in Leeds, Liverpool, Manchester or Sheffield, the hardest part of scaling has rarely been the science. It has been getting a cheque of meaningful size from an investor who understands the sector and is prepared to back a second or third round without demanding relocation to London or the Bay Area first.


Northern Gritstone, the investment company built to back spinouts from the North of England's universities, is now trying to close that gap from the other direction, by opening an office in San Francisco. Chief executive Duncan Johnson said the move is about giving Northern Gritstone's portfolio companies direct access to US capital, not as an alternative to their Northern roots but as an addition to them. "It means you can grow quicker, because the US is better at procuring, and their risk appetite for technology is higher," he said.


"It allows us to recruit more talent into our businesses. UK companies trade at a discount in the US, and capital is good at finding opportunities. But you've got to make the effort to go and make it easy for them."


What is changing


Five of Northern Gritstone's portfolio companies, including Series B plus businesses Pragmatic Semiconductor, Iceotope and Phagenesis, already count US investors among their backers. Rather than leave that connection to chance, the firm's first move in the Bay Area will be to recruit a venture partner on the ground, whose job is to give the rest of the portfolio what a spokesperson described as a soft landing, meaning a network, capital and business development from day one, instead of a cold start.


The rationale is backed by data rather than sentiment. Dealroom figures cited by the firm show that UK companies backed by American investors typically raise larger rounds earlier and grow revenue four times faster over the two years after investment than peers backed only by UK money. For founders building outside the traditional Golden Triangle of Oxford, Cambridge and London, that is a significant structural advantage to be locked out of by geography alone.


Why the geography matters


Northern Gritstone has been active since May 2022 and has made 50 investments across semiconductor design and manufacturing, novel materials, secure computing, AI, health technology and gene therapies. Many of its portfolio companies are spinouts from what it calls the Northern Arc, the universities of Leeds, Liverpool, Manchester and Sheffield, which between them generate close to 800 million pounds in research funding a year.


Northern Gritstone positions the Northern Arc as one of four globally competitive centres in the UK's research base, alongside Oxford, Cambridge and London, describing its own portfolio as "rooted in the North, global in ambition."


That framing matters because most of the public conversation about who gets overlooked by venture capital focuses on gender and ethnicity, categories that are, rightly, tracked and reported on. Geography is tracked far less often, despite being just as structurally significant. A founder building excellent deeptech in Sheffield does not lack for science.


What they have historically lacked is proximity to the investors, and increasingly the international investors, who write the largest cheques earliest. A regional fund building its own bridge to that capital, rather than waiting for it to arrive via London intermediaries, is a practical answer to a problem this publication has covered repeatedly this year.


What comes next


The San Francisco office is a small move in absolute terms, a single venture partner hire rather than a new fund. Its significance lies in the model it represents: a regional, university linked investment platform treating international capital access as core infrastructure for its founders rather than a stroke of luck reserved for those who happen to have the right network. Whether other regional UK funds follow a similar path, and whether the promised soft landing translates into measurably larger rounds for Northern Gritstone's own portfolio, is worth watching over the next twelve months.


Key takeaways


  • Northern Gritstone, the investment firm backing deeptech and life sciences spinouts from Leeds, Liverpool, Manchester and Sheffield universities, is opening an office in San Francisco to connect its portfolio to US capital.

  • Five portfolio companies, including Pragmatic Semiconductor, Iceotope and Phagenesis, already have US investors; the firm's first Bay Area hire will be a venture partner tasked with giving the rest of the portfolio a soft landing.

  • Dealroom data cited by the firm shows UK companies backed by American investors raise larger rounds earlier and grow revenue four times faster over two years than peers backed only by UK capital.

  • The move highlights a structurally underreported form of founder disadvantage, geography, alongside the more commonly tracked categories of gender and ethnicity.

  • Northern Gritstone has made 50 investments since 2022 and frames its Northern Arc university base as one of four globally competitive UK research centres alongside Oxford, Cambridge and London.


Source: businesscloud.co.uk, "Northern Gritstone targets US capital with San Francisco office", published 15 August 2026, https://businesscloud.co.uk/news/northern-gritstone-targets-us-capital-with-san-francisco-office/

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