EarthSense secures loan using its IP as collateral

Air quality monitoring firm EarthSense have secured a £264,000 loan from NatWest using its intellectual property as collateral

The Leicester-based company launched in 2016 to utilise technology developed at the University of Leicester, and have since seen 60% year-on-year growth.

EarthSense has advanced its specialist air quality offerings with an award-winning air quality monitoring solution, the Zephyr, and its leading air quality platform MyAir that enables users to leverage its air quality data through its MappAir global model. EarthSense was looking for funding to scale up further, which NatWest was able to support through its new high growth lending proposition.

Earlier this year, NatWest became the first UK high street bank to offer IP backed lending to high growth SMEs, with loans starting from £250,000 up to 50% of the value of the firm’s intellectual property. The bank said IP-backed lending would improve the funding pipeline for scale-ups, which because of their lack of fixed assets, may find it difficult to secure loans to drive their growth.

Tom Hall, CEO of EarthSense, said: ‘In terms of our business, we see IP as our most important asset. So when our NatWest Relationship Manager, Andy Edwards, mentioned the new IP-backed loan, we did bite his hand off!’

Tom added that the Inngot platform’s valuation for EarthSense’s IP was more than enough for NatWest to offer them the initial funding they needed, which was focused on overseas expansion and on expanding the company’s IP. But, he continued: ‘We are expecting to expand our IP asset base significantly in the next 12 months, and I would expect to be coming back in and leveraging the value of our IP further. Using the IP backed loan, it will allow us to bring our air quality solutions to even more countries.’

Neil Bellamy, Head of Technology, Media and Telecoms at NatWest, said: “’As Britain’s biggest bank for start-ups, at NatWest we see innovative and disruptive businesses like EarthSense pass through our doors every day. We believe in powering up their success, which is why we are the only UK bank to offer a mass-market IP-backed lending proposition for SMEs, starting from amounts as low as £250,000.

‘We know that access to finance is often the biggest hurdle for high growth tech firms, who may have incredible IP, but can lack the tangible assets needed to secure growth funding. Solving this problem will help companies like EarthSense develop solutions to tackle the world’s most pressing problems, while driving forward their growth and boosting the UK economy.’

Martin Brassell, CEO of Inngot, the specialist IP evaluation company which valued EarthSense’s IP, said: ‘This loan showcases the importance of IP and innovation in addressing the climate challenges we all face – and demonstrates that the assets driving the transformation we need can themselves be leveraged for finance. It also proves that with NatWest and Inngot’s approach, it is possible to take these business-critical assets properly into account even at modest levels of lending. This points to the role IP can now play in fostering growth, from the beginning of a scale-up’s journey, right through to maturity.’