'Our bloody nose count is quite low'

Northern Gritstone's Duncan Johnson counts his blessings (and his cap table)

Hello Rainmakers,

We’ve got the full length editor’s cut of an interview with Duncan Johnson, founder and CEO of Northern Gritstone.

It’s a fascinating deep dive into his motivation, his experience and what it’s like to work with academics from research intensive universities, and how he nearly took up politics.

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Duncan Johnson knows what failure looks like, and he says it’s given him the sharp eye to spot success too.

The chief executive of Northern Gritstone looks and sounds like a man having the time of his life, hanging out with the brightest minds of UK science, and finding funding for their breakthrough discoveries, which may change the world.

At the Emerge programme in Sheffield

From a standing start and a blank sheet of paper he’s shaped Northern Gritstone to be a chunky life sciences and deeptech investment firm that’s now raised £362 million. When we meet at the Manchester office in Circle Square, he’s particularly pleased with the most recent investment into the pot. It includes £50 million from leading institutional investors including £35m from LGPS, the collective asset pool for Greater Manchester, Merseyside and West Yorkshire Pension Funds, alongside £15 million from new investors Fulcrum Asset Management and Aviva.

What pleases him most is that the funds have been raised when the market is on “risk off” mode.

“What hasn’t gone well is the market is poor. So we’re in a properly ‘risk off’ market still. I keep hoping it’s going to come ‘risk on’. And I mean by that, that risk appetite is low. When you’ve got a relatively high interest rate environment, you’ve got a lot of volatility. Money is not thinking long term. Money is not going into equities. And we need that ‘risk on’ culture and we need it coming into the equity market.”

He says things aren’t helped by the lack of visible exits within the private capital asset market. “There’s no IPO route, there’s been very little M&A. In quarter two and three in the UK it was the lowest it’s been for six years.”