22OCT

UKRI grants £50m to quantum firms; MPs urge equity

3 min read

16:30UTC

UK Research and Innovation split £50m between six quantum sensing companies; eight days later the Public Accounts Committee told it to start taking stakes.

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Key takeaway

MPs want UKRI to take stakes in the companies its grants fund.

UK Research and Innovation (UKRI) split £50m on 13 October between six quantum companies in its Sensing and Positioning, Navigation and Timing competition⁠¹. The winners span the country: QLM Technology in Wales with a greenhouse-gas camera, Quantum Fabrix in Oxford with a satellite clock, MoniRail in the West Midlands with train positioning, Siloton of London and Bristol with a handheld eye scanner, ColdQuanta UK in Oxford with a mobile quantum radio antenna, and Cerca Magnetics of Nottingham with a wearable brain scanner. The release publishes no per-company amounts. A further £20m goes to a quantum networking competition that names Sheffield's Aegiq, and £8m expands a quantum apprenticeship scheme at Harwell to 150 places by 2030.

Eight days later, City AM reported, the Commons Public Accounts Committee (PAC) said UKRI was too reluctant to take equity or rights to intellectual property in the companies it funds, and urged it to take stakes⁠². The PAC put university spinouts linked to research-council funding at 85 in 2024, down from 173 in 2020. It said about 45% of the Science and Technology Facilities Council estate is in unacceptable condition. Chair Sir Geoffrey Clifton-Brown said "you do need to, in certain technologies, have a sovereign capability."

A UKRI grant takes no stake; on the PAC's argument, the financial return on publicly funded research then goes to whoever invests next. UKRI also gave £162m to the Royce and Franklin institutes in September.

Deep Analysis

In plain English

UK Research and Innovation, known as UKRI, is the government body that hands out money for science. It has given £50m in grants to six small companies working on quantum sensing. These are devices that use atomic physics to measure things such as position, time or brain activity far more precisely than normal tools. A grant is a gift: UKRI gets no share of the company in return. A committee of MPs that checks how public money is spent says UKRI should take shares or rights to inventions instead, so taxpayers benefit if the companies succeed.

Deep Analysis

Root Causes

UKRI was set up as a research funder, and its grant rules come from academic funding. Taking equity would need new powers, staff who can value companies and a body to hold the stakes, which the British Business Bank already does for venture funds.

The drop in research-council-linked spinouts, which the PAC put at 85 in 2024 from 173 in 2020, may also reflect university equity terms and a harder seed market, though the committee's causes were not reported.

What could happen next?

Consequence
If UKRI adopts equity terms, future grant winners would give up a share of ownership in return for public research money.
Opportunity
Award winners outside the golden triangle, including QLM Technology in Wales and Cerca Magnetics in Nottingham, gain public backing ahead of private rounds.

Source Landscape

This story draws on neutral-leaning sources

Primary parallel: Israel's Innovation Authority funds company research through grants repaid as royalties, typically a few per cent of sales, once products earn revenue. The state gets money back without holding shares.

Counter-parallel: The US Small Business Innovation Research programme, running since 1982, gives grants with no equity or royalty, and Washington counts its return in tax and jobs. Both systems still fund thousands of firms; they differ only in who keeps the upside.

The £50m sensing pot is split between six companies without published amounts, so the size of any single award cannot be assessed. The separate £20m networking competition and £8m apprenticeship expansion are programme money, not company stakes.

The PAC's estate figure matters for the long run: about 45% of the Science and Technology Facilities Council estate in unacceptable condition, and £5.6bn to restore university research facilities, both as City AM reported. Labs in poor repair raise the cost of the research that seeds future spinouts.

Consensus view: The government release, which names Prof Charlotte Deane as UKRI's senior responsible owner for the quantum priority programme, presents the awards as steps towards the government's goal of up to £2bn in quantum sensing by 2030, using grants to pull products such as train positioning and brain scanners into use.

Counter-view: The Public Accounts Committee, as City AM reported it, argues grants without equity hand the upside of public research to later investors. Its chair, Sir Geoffrey Clifton-Brown, tied that to sovereign capability in certain technologies.

Key tension: Whether UKRI taking equity would bring public money a return, or would deter the private investors whose follow-on rounds these companies need.

First Reported In

Update #16 · Stryker agrees option to buy CMR Surgical

Department for Business, Innovation, Science and Trade· 22 Oct 2026

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Causes and effects

Caused by

UKRI puts £162m into two institutes

UKRI's quantum awards followed its £162m institute allocation in September.

Occurred 14 Sept 2026

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This Event

UKRI grants £50m to quantum firms; MPs urge equity

On the Public Accounts Committee's argument, grants that take no equity hand the return on publicly funded research to later investors.

Different Perspectives

Abu Dhabi Investment Council

The Abu Dhabi Investment Council holds notes in Nscale's $3.36bn pre-IPO raise, beside Third Point, Apollo, Citadel and Nvidia. No British institution appears among the named holders of notes that convert into shares at Nscale's New York listing.

CDP Venture Capital

CDP Venture Capital, the venture arm of Italy's state lender, led TrueLayer's £20.4m round to expand Pay by Bank across Europe. A foreign state investor set the terms on a London fintech round in the same month the British Business Bank mostly followed.

EDBI

Singapore's state investor EDBI joined Universal Quantum's Series A of more than $100m, and the Sussex company is opening its first research centre outside Europe in Singapore. British state money is absent from the largest Series A by a UK quantum company.

Forbion

Forbion co-led OMass Therapeutics' $310m Series C with Bain Capital Life Sciences and Novo Holdings, while the British Business Bank and Syncona followed. The terms of the Oxford spinout's round were set by investors from three countries, none of them Britain.

British Business Bank

The Bank committed £180m to six AI funds on 15 October with no UK-deployment condition, yet led the first close of Microbiotica's £36m Series C. That lead, with Airtel Money choosing London for its £5.3bn debut, is the evidence that British money and markets still set some terms.

Stryker Corporation

Stryker called its roughly $400m CMR Surgical deal its entry into soft-tissue robotics, taking US sales rights for Versius, a board seat and an exclusive option over 100% of the company. The option lets Stryker choose whether and when a Cambridge robot maker becomes part of an American group.

Written with AI from Lowdown's published reporting. Not individually reviewed by an editor. Editorial standards.