The first venture capital firm in the UK to build ‘on campus’ investment funds has signed a deal with the University of Manchester.

In an attempt to identify the tech stars of the future, the agreement will see Campus Capital invest between £50k and £200k in early-stage companies.

Based on a model already prevalent in the US, it will be looking on and off campus in the Manchester city region.

The deal follows one struck earlier this year with the University of Sheffield, and Campus Capital will soon start raising its first £2m fund.

Entrepreneurs Samantha Deakin Hill and Michael Howe found inspiration in US funds such as the Wolverine Venture Fund and the Dorm Room Fund.

Howe said the business is speaking to North West investors as part of the fundraising process and plans to roll the model out nationwide through other universities.

He explained: “Universities are at the heart of the knowledge economy – through their research and development, their role in educating future entrepreneurs and their close links with current business leaders.

Manchester University

“It makes sense for venture funds to work more closely with them.

“Campus Capital will allow investors to plug directly into these knowledge hubs, making use of their networks and engaging students in building the deals pipeline.”

He added: “It will also provide a new source of funding for high-growth Manchester businesses, whether on or off campus.

"Our aim is to identify early-stage companies with the potential to become the technology stars of the future.”

NOMINATE: Search is on to find UK's 150 best tech start-ups

Campus Capital is endorsed by growth accelerator Tech North.

Lynn Sheppard, the director of Manchester Enterprise Centre, part of Manchester Business School, commented: “The University of Manchester has a long tradition of supporting innovation.

“We are delighted to be working with Campus Capital to help pioneer this new model, which will provide further opportunities for students to build experience.”

She continued: “It will allow them to gain insight into the issues facing technology start-ups, understand the perspective of both entrepreneurs and funders, and many of the factors required to create a successful, high-growth business.”

Epiphany Capital founder Tim Dempsey said: “This is a really new exciting model of venture capital that we have not yet seen properly executed in the UK.

“Manchester and Sheffield are perfect launch partners, and Campus Capital has the ability to affect a real change in the way these ecosystems work, as well as investing in serious talent.”