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Innovate UK — the UK's national innovation agency, part of UK Research and Innovation (UKRI) — opened the "Growth Catalyst: Investor Partnerships Round 2" competition on 10 December 2025 via the GOV.UK Innovation Funding Service. The programme allocates a minimum of £100 million in grant funding to UK-registered micro, small and medium-sized enterprises (SMEs) that carry out project work in the UK.
Structure — grant paired with mandatory private co-investment:
| Research category | Project costs | Grant coverage | Minimum investor match |
|---|---|---|---|
| Feasibility studies | £50,000-£300,000 | 60-70% | Equal to grant |
| Industrial research | £100,000-£1,000,000 | 60-70% | Equal to grant |
| Experimental development | £250,000-£2,000,000 | 35-45% | Double the grant |
Applicants must already have "a relationship and a strong level of investment traction with one of Innovate UK's approved investor partners" before applying — the private-match capital must be committed before a grant can be disbursed, and the project cannot start until it is secured. This is an "Investor Partnerships" model rather than a standard grant-only competition, designed to crowd in private venture capital alongside public money at VC decision speed.
Projects must align with a priority sector from the UK's Modern Industrial Strategy ("Invest 2035", Command Paper CP 1451, filed as 2025-06-23-uk-modern-industrial-strategy): advanced manufacturing, clean energy, digital and technologies, defence, creative industries, life sciences, or the separate Battery Innovation Programme.
The competition opened 10 December 2025 and closes 3 February 2026 at 11:00 UK time.
Industrial Strategy at the SME/startup-finance level, complementing larger vehicles like the National Wealth Fund and British Business Bank capital uplift already committed under CP 1451.
for experimental-development grants) means the effective capital mobilised could exceed £100m grant value alone — a state-crowding-in model similar in spirit to the DSIT Sovereign AI Fund's equity+compute bundling (2026-04-16-uk-dsit-sovereign-ai-fund), though this programme is grant-based rather than equity-based.
subsidy under its methodology; in IPTM terms this is a modest, domestically-targeted SME-support instrument rather than an export- or sector-dominance play, hence the low severity rating.
first cohort (competition closes 3 February 2026).
£100m or extend to additional Industrial Strategy sectors not yet covered (e.g. financial services, professional and business services).