British Business Bank backs PhysicsX with USD $25 million

British Business Bank has invested USD $25 million in PhysicsX as part of the company’s Series C financing, marking the fourth investment from British Growth Partnership Fund I.

The funding is part of a wider Series C round led by Temasek and including M&G Investments. The transaction reflects the co-investment model of British Growth Partnership, which is designed to channel pension fund money into UK venture-backed companies.

Founded and headquartered in the UK, PhysicsX develops artificial intelligence software for industrial engineering. Its platform is used across aerospace and defence, semiconductors, data centres and energy production, automotive, and materials.

The company is building software intended to change how industrial groups design, manufacture, and operate hardware. At the centre of that effort are its Large Physics Models, which aim to predict the physical behaviour of complex systems in near real time rather than over the days or weeks often associated with conventional numerical simulation.

The investment comes as PhysicsX reports rapid growth. Over the past year, it said it had doubled recognised revenue, tripled booked revenue, and more than doubled its customer count.

Its workforce has also expanded sharply. PhysicsX now employs more than 300 people after doubling in size over the past 12 months.

The latest capital is intended to support international expansion, broader platform development, and further research, including work on larger pre-trained physics AI models.

Pension fund route

For British Business Bank, the transaction also serves a broader policy aim: connecting institutional capital with emerging UK companies. British Growth Partnership Fund I reached a first close of GBP £200 million, and PhysicsX is the fourth company backed by the fund, alongside Wayve, Elliptic, and Draig Therapeutics.

Charlotte Lawrence, Managing Director and Head of Direct Equity at the British Business Bank, said: “PhysicsX is redefining how complex products are designed and built. Their platform combines world-class engineering heritage with frontier AI capability to create a company that we believe can be a global leader. As their technology is adopted by the world’s top industrial companies, we are thrilled to back their continued expansion whilst also allowing UK pension owners to share in the success of a true global innovator.”

Ian Connatty, Managing Partner of the British Growth Partnership and Deputy CIO of the British Business Bank, said: “The British Growth Partnership was created to connect pension funds with the UK’s fastest-growing companies. This transaction shows that model in action, and that we have built a platform for domestic pension fund capital to flow into the UK’s technology leaders.”

M&G Investments also highlighted the role of long-term institutional investors in funding private UK businesses. Its participation in the round sits alongside its backing of the British Growth Partnership.

Niranjan Sirdeshpande, Head of Catalyst at M&G Investments, said: “PhysicsX is an excellent example of the type of high-growth, technology-led business that institutional investors want to back. M&G has supported the company’s growth both through Catalyst’s direct investment and through our backing of British Growth Partnership, helping to channel long-term pension fund capital into innovative UK businesses with significant global potential. This investment demonstrates how government and industry can work together to improve access to growth capital for UK businesses, supporting innovation, skilled jobs and economic growth, while delivering attractive long-term returns for savers.”

Industrial AI

PhysicsX targets manufacturers and engineering groups that need to model complex physical systems more quickly. The company says its software can be embedded into existing engineering workflows to shorten development cycles and reduce costs.

That positions it in a growing area of industrial AI, where software companies are applying machine learning tools to long-established design and simulation processes. In the UK, the sector has drawn increasing interest from investors looking for businesses tied to advanced manufacturing and industrial technology rather than consumer AI applications.

Jacomo Corbo, Co-Founder & CEO of PhysicsX, said: “The opportunity to transform how humanity designs, builds, and operates the world’s most critical infrastructure is one of the defining technological opportunities of our time. PhysicsX exists to realise that opportunity. We are building frontier physics AI technology in Britain, scaling it globally, and helping the world’s leading industrial companies innovate faster and unlock a new era of productivity. As the UK seeks to strengthen its position in advanced manufacturing and industrial AI, we’re proud to be contributing to that ambition from our headquarters in London, with the British Business Bank as an investor and partner in that journey.”

In its latest reported year, British Business Bank said it supported 38,000 UK businesses, helping them access GBP £9.4 billion of finance through public funding, private capital crowded in by the bank, and guaranteed lending.