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07/11/2012

Nonlinear Group has raised £1.53m to assist its next phase of expansion in the field of diagnostics

Newcastle based life sciences software and diagnostics business Nonlinear Group has announced that it has raised £1.53m of new external funding to assist with the financing of the next phase of its expansion in the field of diagnostics.  This comes off the back of some significant strategic developments the business has secured in recent months.

The group consists of two companies, Nonlinear Dynamics and Biosignatures. Nonlinear is a world leading, profitable, growing business involved in the scientific field of proteomics. It supplies most of the world’s leading research organisations and pharmaceutical companies with software tools to aid research and development into new treatments for disease.

Biosignatures is a younger business with a particular focus on cancer diagnostics and also assisting companies to develop companion diagnostics and personalised medicine products.  This latter area is a burgeoning alternative to the historical “one size fits all” model of drug development which enables the provision of drugs specific to the needs of individual patients or patient groups. The molecular diagnostics products are all targeted at areas of strong clinical need, initially prostate, renal and bladder cancer. Biosignatures represents a major growth opportunity for the Group.

Will Dracup who founded the business in 1989 and has been a leading player in proteomics and related software for the last two decades.  Mr Dracup said “I am delighted with the latest funding package Nonlinear Group has attracted as it enables the business to continue to invest for very strong growth.  The intellectual property and products we have developed over the years are very much matched to what clinicians and researchers need, and this is driving strong demand for our products and services. We have some very exciting strategic collaborations to deliver in the short and medium term and bringing on board these new funds and strong investors will help to guarantee success”.

Duncan Barrie the Group Finance Director said the Nonlinear business has been profitable for many years and this investment will help the Biosignatures business achieve its revenue and in time, profitability goals.

The equity and mezzanine funding package was raised by Roland Tate of Tiger Corporate Finance who introduced and acted for all the investors in the syndicate.  The largest group in the syndicate was a set of experienced private angel investors one of whom who will join the Nonlinear board.  The private investors were matched by Capital For Enterprise, led by Tim Mills and Paul Fauset from their Sheffield office, who manage the Government-backed £50m Angel CoFund which invests alongside angel syndicates into SMEs with high growth potential. The fund aims boost the quality and quantity of business angel investing in England to support long-term, high quality jobs in growing companies. 

FW Capital, led by its Newcastle based investment team of Andrew Coles and Rob Jones, which manages the £20 million North East Growth Plus Fund, part of the Finance for Business North East Fund, completed the £1.53million syndicate.  Banking facilities continued to be provided by Yorkshire Bank.

Mr Tate commented “I have known the directors for many years and I am delighted to have delivered this funding round for the business.  Nonlinear has a very strong reputation due to the quality of its proprietary product suite and has a ringing endorsement from a wide range of major clinical research and pharma companies who are keen to work with the business on new opportunities.  Nonlinear has a strong story to tell and sells its products around the world to some of the leading players in its field”.

Investment Executive, Rob Jones explained why FW Capital was keen to invest: “Nonlinear is a profitable and highly-regarded global leader with innovation at its heart.  It’s at the forefront of the sectors it operates in with products that have the potential to diagnose certain medical conditions more accurately.  This investment will play an important role in the company’s expansion and we wish the management team well.”

Newcastle based Square One Law provided lead legal advice to the syndicate whilst Dickinson Dees acted for Nonlinear.

North East Growth Plus Fund