UK-based photonics and quantum technology company, M Squared, has raised £32.5M (approx €36.4M) in a fresh round of funding from Santander UK – a British bank, and newly formed Scottish National Investment Bank, to support growth and technology developments of the company.
Transaction and use of the raised capital
Santander UK will be providing a £20M (approx €22.4M) debt facility, allowing M Squared’s founders and management team, led by Dr. Graeme Malcolm OBE, to fund the acquisition of the substantial part of BGF’s current shareholding along with fuelling the next stage in business and technological growth. The newly formed Scottish National Investment Bank will also support M Squared with £12.5M (approx €14M) of growth capital.
In 2012, Business Growth Fund (BGF is the UK’s investment company, providing growth capital for SMEs) invested in the company and will realise the majority of its existing shareholding in M Squared. However, it will continue to retain a meaningful stake going forward as a long-term partner.
Speaking on the development, Dr Graeme Malcolm, founder & CEO of M Squared, says, “Our commercial and technological potential is enormous, and with this transaction, we have the ideal financial and structural platform to progress and realise substantial growth and launch major new developments. We are delighted to now be working with both Santander UK and the Scottish National Investment Bank, alongside continued support from BGF, on funding a shared goal to innovate and scale.”
The raised capital will enable M Squared to further advance its research and development. This is key to upscaling its pioneering work in quantum innovation alongside its technologies to help tackle climate change.
How was M Squared formed?
M Squared was founded in May 2006 by Dr Graeme Malcolm OBE (Order of the British Empire) and Dr Gareth Maker – a subtle nod to the company name itself. A reference to the names of the founders and the formula for the multiplication factor in a laser beam’s propagation.
Malcolm and Maker set out to create novel laser-based solutions for use in innovations and academic research.
Both founders met at The University of Strathclyde. Their shared passion led them to co-found their first company Microlase Optical Systems in 1992, a spin-out from Strathclyde University. With time, the company (Microlase) and its range of products caught the eye of Coherent Inc., which purchased Microlase in 1999.
Graeme continued to lead the newly formed Coherent Scotland during the transition and beyond.
It was in 2006 that the former partners came together and formally launched M Squared. The company developed a laser that would be scalable, compact, robust, fully automated, and more accurate than existing systems. This idea realised in the award-winning SolsTiS laser platform, as claimed by the company, made a huge difference to scientific studies in quantum technologies worldwide.
What does M Squared do?
M Squared designs and manufacture advanced photonics tools for use in science, industry, and education. Its lasers have enabled breakthroughs in quantum technology, biophotonics, and chemical sensing. Besides, they have also been used by sectors such as aerospace, defense, oil and gas, healthcare, food, and drink. Its products include SolsTiS, Sprite, and Firefly – the tools of choice for researchers and innovators.
M Squared’s SolsTiS laser platform alone has helped in significant breakthroughs, including the world’s most accurate clocks, demonstrations of teleportation of information, antimatter experimentation, and the construction of ‘ion-drives’ – the next generation of space propulsion.
The company’s innovations are addressing global scientific and technology challenges in fields of climate change, healthcare, quantum computing, and virtual reality. “Therefore, M Squared’s activities will make a contribution to all three of the Scottish National Investment Bank’s proposed core missions to support Scotland’s transition to net zero, build communities and promote equality, and harness innovation,” says the company in a statement.
Recent developments
Earlier this year, M Squared announced it is leading the UK’s largest industry-led commercial quantum computing project as part of an Innovate UK Challenge fund, DISCOVERY. M Squared’s total investment has reached £50M (approx €56M) in the year, to date, despite the Covid-19 pandemic.
The company is now considered a major component of the central government’s commitment to research and development and its future industrial strategy. This transaction provides financial strength and independence for the company to play a significant role in the next stage of this technology’s commercialisation.
In October 2019, a University of Strathclyde-led quantum technology partnership, with an aim to develop the world’s most powerful computers, secured £4.6M (approx €5.1M) in a funding round to back commercial collaboration with M Squared. Researchers at Strathclyde and photonics and quantum technology company M Squared joined hands to develop advanced computing technology, to strengthen banking security, enhance traffic management, and support aerospace security.
Image credit: M Squared