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Cybersecurity specialist Cytix raises £1.6m from Northern Powerhouse Investment Fund II

Press release 26 September 2024

A portrait of the team from Cybersecurity specialist Cytix

A growing cybersecurity company has raised £1.6m to expand its client base and scale its operations as demand grows for support managing tech defences.

Manchester-based Cytix has raised the money in a round co-led by the NPIF II – Praetura Equity Finance, which is managed by Praetura Ventures and is part of the Northern Powerhouse Investment Fund II.

The business presents an alternative approach to annual penetration testing. Cytix enables companies to identify high risk vulnerabilities during code development, resulting in vulnerabilities being caught much earlier than traditional security testing options.

According to Cytix, many automated testing solutions miss about 20% of vulnerabilities that can only be found via manual testing methods, which often leaves businesses waiting up to a year for them to be uncovered with a traditional penetration test.

The cybersecurity specialist remedies this by analysing every development change a business makes in real-time, predicting potential security flaws and orchestrating immediate testing instead of ad-hoc reviews.

Cytix’s customers span multiple sectors and include the stablecoin fintech BNVK, medical clinical trials experts Protas and the bot prevention company Netacea as well as Cambridge University’s research and publishing arm, Cambridge University Press & Assessment.

The business plans to use the funding to double its client base within the next 12 months and further develop its product offering for the enterprise market, with plans to target the banking sector, financial services and fast-growing software businesses.

Founded in 2022 by Ben Armstrong, Thomas Ballin and Matt Milan, the business is one of the latest companies to be funded by the British Business Bank’s £660m NPIF II fund, with French VC Auriga and Cytix’s existing funder SFC Capital also investing.

Ben Armstrong, co-founder and CEO at Cytix, said: 

Automated scanning technologies have transformed the way we identify and remediate most vulnerabilities. However, companies still need to rely on manual penetration testing for certain classes of vulnerability that automated tools can’t detect. This area of the market has remained largely a stagnant and annual process, meaning a proportion of vulnerabilities are left to be detected just once a year. Cytix is here to change that using the latest AI models to bring all testing forward and create targeted testing at scale.

Our latest funding round enables us to expand our existing A star team to tackle the problem and achieve our goal of bringing security testing up to speed with modern development. More and more companies are prioritising fast and safe development and Cytix is the perfect security testing partner to help them achieve that.

Michael Rees, investment manager at Praetura Ventures, said:

The North West is rich with innovative cybersecurity companies doing transformational work to protect businesses in all sectors. Now Cytix is pioneering a new form of penetration testing that improves results for clients, providing the business with a perfect platform for growth.

With funding from NPIF II, and more than money from Praetura, Cytix has the resources it needs to continue its exciting growth trajectory and scaling journey from its base here in Manchester.

Simon Cunnington, Director at British Business Bank, said:

Manchester is fast-becoming a leader in cybersecurity solutions, and Cytix is great example of a Northern-based business that is leading the charge against online threats. This investment from the Northern Powerhouse Investment Fund II will make a measurable difference in supporting Cytix’s growth, and helping to protect more businesses from cyber threats. Placeholder Name Occupation / Organization

The £660m Northern Powerhouse Investment Fund II (NPIFII) covers the entire North of England and provides loans from £25k to £2m and equity investment up to £5m to help a range of small and medium sized businesses to start up, scale up or stay ahead.

The purpose of the Northern Powerhouse Investment Fund II is to drive sustainable economic growth by supporting innovation and creating local opportunity for new and growing businesses across the North of England. The Northern Powerhouse Investment Fund II will increase the supply and diversity of early-stage finance for the North’s smaller businesses, providing funds to firms that might otherwise not receive investment and help to break down barriers in access to finance.

Further Information

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Notes to editors

About the Northern Powerhouse Investment Fund II

  • Operated by the British Business Bank, the Northern Powerhouse Investment Fund II (NPIF II) provides a mix of debt and equity funding. NPIF II will offer a range of commercial finance options with smaller loans from £25k to £100k, debt finance from £100k to £2m and equity investment up to £5 million. It works alongside the Combined Authorities, Local Enterprise Partnerships (LEPs), and Growth Hubs, as well as local intermediaries such as accountants, fund managers and banks, to support the North’s smaller businesses at all stages of their development. 
     
  • The funds in which the NPIF II invests are open to businesses with material operations, or planning to open material operations, in: Cheshire, Cumbria, Greater Manchester, Lancashire, Merseyside, City of Kingston upon Hull, East Riding of Yorkshire, North Yorkshire, South Yorkshire, West Yorkshire, Hartlepool and Stockton-on-Tees, South Teesside, Darlington, Durham, Northumberland, Tyneside, Sunderland.

For investment by NRIL at the sub-fund level

  • The investment from the Nations and Regions Investments Limited into [.] does not amount to any endorsement or warranty from Nations and Regions Investments Limited, the British Business Bank plc or the government of the United Kingdom.

For investment by NPIF II sub-fund at the investee company level

  • The investment from the Northern Powerhouse Investment Fund II into [.] does not amount to any endorsement or warranty from Nations and Regions Investments Limited, the British Business Bank plc or the government of the United Kingdom. 
  • Smaller Loans from £25,000 to £100,000 – GC Business Finance & River Capital (North West), Business Enterprise Fund (BEF) (Yorkshire and Humber) and NEL Fund Managers (North East)
  • Business Loans from £100,000 to £2m – FW Capital (North West), Mercia (Yorkshire and Humber) and NEL Fund Managers (North East)
  • Equity Finance up to £5m – Prateura Ventures (North West), Mercia (Yorkshire and Humber), and Maven Capital Partners (North East) 

Applications for funding are made directly to the relevant fund managers who can be contacted via the NPIF II webpages.

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