Dragonfly Advanced Materials raises £1m from Northstar Ventures and Innovate UK
This article covers Dragonfly Advanced Materials, a Northumberland-based greentech startup spun out of Newcastle University, and its £1m pre-seed funding round, comprising £500,000 from Northstar Ventures and a £500,000 grant from Innovate UK's Investor Partnership programme. The funding will accelerate commissioning of a new manufacturing facility and scale commercial efforts for a lower-cost silica aerogel production process that aims to broaden industrial use.
Dragonfly Advanced Materials, a Northumberland-based greentech startup spun out of Newcastle University, has raised £1 million in a pre-seed funding round: £500,000 from Northstar Ventures and a £500,000 grant from Innovate UK’s Investor Partnership programme. The cash will accelerate commissioning of a new manufacturing facility and scale commercial efforts for a lower-cost silica aerogel production process that aims to broaden industrial use of the material.
Why it matters
Aerogels are notable for very low density, strong insulation, fire retardancy and water resistance, but high cost and complex production have limited their use. If Dragonfly’s process delivers on its claims — simplifying manufacture, cutting reliance on expensive or environmentally problematic solvents, and allowing tailored formulations — it could open routes to wider adoption across coatings, energy, construction, transport and industrial manufacturing.
The funding is therefore important less as a headline amount and more as a signal that public and regional investors are prepared to back commercialisation of deep tech developed in universities.
Inside the product
Dragonfly manufactures silica aerogels and says it has a patented, process-led approach intended to reduce production costs and improve scalability. The company has built an intellectual property portfolio encompassing three patents and is finalising a Northumberland facility designed to supply larger quantities for customer validation and development.
The technology reportedly allows characteristics to be adjusted and other materials to be incorporated, enabling customised formulations for different end uses. The company positions those end markets where demand for advanced materials is growing, including thermal coatings, energy systems and industrial components.
Who are the investors?
The funding combines private venture capital and a public grant. Northstar Ventures provided £500,000 through the North East Spinout Inspire Fund, and Innovate UK contributed a £500,000 award via its Investor Partnership programme.
The North East Spinout Inspire Fund is a £22.5 million vehicle backed by the universities of Durham, Newcastle, Northumbria, Sunderland and Teesside, together with the North East Mayoral Strategic Authority via the North East Fund. The fund’s stated purpose is to commercialise research emerging from the region’s universities and to support university spinouts through early growth stages.
In the announcement, Tom O'Neill, Investor at Northstar Ventures, said:
Dragonfly has developed a versatile, highly differentiated advanced materials technology with the potential to disrupt the industry by unlocking new applications for aerogels across major industrial markets. The company has made significant progress since our last investment and we are very pleased to support the team with further funding. The North East has a strong track record in translating university research into companies with global potential. Dragonfly is a great example of the region's ability to generate Deep Tech businesses that can address major industrial challenges whilst creating high-value opportunities in the local economy.
In the announcement, Rick McCordall, Head of Venture Creation at Newcastle University, said:
We are delighted to see Dragonfly Advanced Materials continue to develop and scale since it was spun out of Newcastle University in 2020. This funding from the North East Spin Out Inspire Fund alongside the Innovate UK grant will enable the company to continue to disrupt the market and drive revenue. This is another great example of a research based technology developed by our academics transitioning into a commercially successful business. We will continue to support Dragonfly and others to achieve this commercial success.
The combination of a regional venture fund and an Innovate UK grant reflects a common route for university spinouts seeking both commercial validation and technical scale-up support.
If you're researching potential backers in this space:
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Founder perspective
In the announcement, John Baines, CEO at Dragonfly Advanced Materials, said:
This investment marks an important milestone in Dragonfly's progression from university spinout to commercial advanced materials business. Over recent years, we have focused on developing and protecting our technology, expanding our intellectual property portfolio to three patents, scaling our manufacturing capability and building relationships with industrial partners. This investment, alongside the Innovate UK Investor Partnership award, provides the resources needed to accelerate commercial deployment and support the next phase of growth. We are grateful for the continued support of Northstar Ventures, Newcastle University and our wider stakeholders. With the majority of our scale-up infrastructure now in place, our focus is increasingly on customer adoption, commercialisation, licensing opportunities and creating long-term shareholder value.
Baines frames the round as a bridge from protected lab technology towards customer trials, licensing and revenue.
The bigger picture
Dragonfly’s raise is a reminder that commercial uptake of greentech often depends on both technical advances and pragmatic regional funding structures that link universities to local investors. The North East has been active in creating funds to spin out research, and Innovate UK grants remain a common lever to de-risk scale-up for capital-intensive deep tech.
For the UK and wider Europe, the challenge is moving advanced materials from prototypes into supply chains where cost, manufacturability and regulatory fit matter. Dragonfly’s progress on production and IP, and the backing from a regional spinout fund plus Innovate UK, illustrate one pathway for that translation.
This story sits within a broader push across the UK and Europe to commercialise university research in greentech and advanced materials, supporting industrial decarbonisation and domestic manufacturing capacity.
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