Each year, Cambridge’s deep science community creates many strong startups. However, founders often spend months trying to secure funding from selective venture capitalists, who use long due diligence processes and focus on backing just one winner. As a result, many promising teams do not get enough funding, and investors end up with risky, concentrated portfolios.
ET Capital is tackling this problem with the Cambridge Venture Index SEIS/EIS Fund 1. The fund uses clear criteria to build a diversified portfolio of up to 10 ventures connected to the University of Cambridge. Instead of focusing on picking one winner, the fund aims for more predictable returns.
The fund closed on £270K in backing from Cambridge Capital Group and other well-known local investors. It is now reviewing its first five potential investments from accelerators like Cambridge Enterprise and Deeptech Labs.
The fund leverages ET Capital’s 32-year track record and research indicating that 5 of 6 synthetic index funds have outperformed the FTSE 100 since 1992.
Provide Cambridge founders with fast, founder-friendly capital
ET Capital was founded in 1992 and is led by Managing Director Martin Rigby, with James Griffiths and David Gill. All are experienced investors who have supported Cambridge cluster companies for decades through multiple funds.
The fund’s goal is to unlock the potential of the Cambridge cluster by reaching out to angel investors who are often left out of top deals. The team has validated their approach by studying 200 startups.
Their method relies on a clear process, not technology: they use their own model to analyse 200 Cambridge startups (from 1992 to 2024) across four accelerators, applying set criteria such as £100,000 minority stakes in first external rounds and minimal due diligence for titles and claims.
What sets them apart? Diversification to lower risk, fast decisions, and a hands-off approach with founders. And the results speak for themselves: five out of six synthetic funds beat the FTSE 100’s returns.
Direct competitors include local groups like Cambridge Angels and accelerator funds such as Deeptech Labs. While these options offer good access, they do not provide the same level of systematic diversification or proven index modelling.
What’s next?
The fund aims to invest in 10 ventures by the end of the financial year, focusing on post-2020 cohorts with modelled returns of over 40%. In the near term, priorities are to finalise the first five deals, attract more angel investors through SEIS/EIS incentives, and publish cohort data. a.
In the long term, the fund aims to launch follow-on index funds in the Oxford and London clusters, grow assets under management to over £50 million, and set this model as the standard for UK deeptech investing, demonstrating that diversification outperforms traditional VC methods.
TFN contacted ET Capital for comment regarding diversity and inclusion strategy; no response was received at the time of publication.
