Pragmatic Semiconductor, a leading manufacturer of flexible integrated circuits, has completed a first close of its Series D funding round, securing an investment of £162m.
The company is planning a limited second close for key investors, of which £20m additional investment is already allocated.
M&G’s Catalyst and UK Infrastructure Bank co-led the funding round with participation from new investors including £7.5m from Northern Gritstone, and existing investors such as British Patient Capital, Cambridge Innovation Capital and Prosperity7 Ventures (the diversified growth fund under Aramco Ventures).
The investment will enable Pragmatic to accelerate its expansion plans in the UK to meet the growing demand for its unique technology from customers worldwide. This includes building its third and fourth fabrication lines at its Pragmatic Park facility in Durham. Over the next 5 years Pragmatic anticipates building at least 8 manufacturing lines in the UK, creating over 500 highly skilled jobs in the North East and Cambridge.
Each line is capable of producing billions of chips that enable countless novel, fast-growing applications across multiple sectors including consumer, industrial, healthcare and beyond. Of particular interest is providing item level intelligence to trillions of fast-moving consumer goods via smart packaging that will improve reuse and recycling, transforming waste management, and enabling a circular economy. Other use cases include wearables, sensors and flexible controllers.
The majority of the investment secured (over 70%) is from UK investors who have been attracted by the significant opportunities for Pragmatic’s technology in new applications, as well as the potential of Pragmatic’s flexible integrated circuits to replace mainstream silicon chips in a wide range of use cases. In addition, the significantly lower carbon footprint of Pragmatic’s semiconductor manufacturing compared to traditional silicon chip fabrication was cited by investors as a key factor.
David Moore, Pragmatic’s CEO said: “This successful Series D round is a clear testament to the massive opportunity for our innovative technology to enable item-level intelligence in virtually any object on the planet. Our global customers value our ultra-thin and flexible form factor, our breakthrough low cost of customisation and rapid production cycles, as well as the lower environmental footprint compared to silicon. Scaling our manufacturing capacity on the UK’s first ever 300mm wafer production lines at our site in Durham will enable us to deliver hundreds of billions of chips to customers worldwide over the coming decade.”
He added “We also see demand from customers for our unique Fab-as-a-Service deployment model. This is a modular semiconductor manufacturing approach that provides customers with access to an efficient, localised and secure supply of chips through a dedicated production facility wherever they need it.”
Northern Gritstone CEO Duncan Johnson added: “With intellectual property acquired from the University of Manchester and a state-of-the-art production line in Durham, Pragmatic represents some of the brightest technology from across the North of England. Its strong impact agenda and desire to create high-value jobs in the region aligns with Northern Gritstone’s ‘profit with purpose’ mission and desire to create a thriving innovation community. We are excited to be investing at this later stage and are optimistic about the growth that Pragmatic can deliver in the next few years as the use of its chips expands.”