Startup Funding: Luke Rajah, BGF Early Stage Partner, Deep Tech and Life Sciences Luke Rajah is a Partner at BGF, focused on early-stage investments in deep tech and life sciences — two sectors where the UK continues to produce globally significant innovation.

From pioneering medtech breakthroughs to next-generation semiconductors, Rajah works closely with ambitious founders tackling some of the world's toughest challenges. In this Entrepreneur UK interview, he shares practical insights for early-stage startups preparing to raise funding, advice on building lasting investor relationships, and the emerging trends he's most excited about.

What are the top three things founders should focus on when preparing to raise their first round of funding?
We focus on deep tech – an area where the UK excels, with a wealth of cutting-edge innovation emerging from our universities. As a first point, we often encourage founders in this space to think early on about what the customer "pain point" is that their technology alleviates or solves, and how they can make it into a product that fits the market. Adopting that sort of mindset helps build the narrative for raising investment.T

he second critical point is building the right team. Doing this sooner rather than later can be valuable when it comes to securing funding. We like to see founders considering who they have around them to provide support and where they might have gaps in their expertise. It's important to have people who can act as sounding boards or challenge founders, whether that means a co-founder, a non-executive director or wider members of the team. Again, the customer or product angle is worth keeping front of mind. Someone whose perspective is "how will this product or service be used?" can make a huge difference.

Thirdly, finding the right investor is much more important than simply finding any investor. Founders should be looking for more than just a cheque and thinking carefully about how to attract the most experienced partners in their space. Alongside capital, founders should seek out investors who bring sector expertise, high-quality board-level insight, and meaningful mentorship. For deep tech startups especially, securing an investor with relevant knowledge early on can put them on the front foot. Building these relationships from the outset demonstrates that a founder-led business is considering the bigger picture — a signal of ambition and maturity that investors value highly.

When evaluating early-stage startups, what key factors do you prioritise?
We think about a framework focused on the five Ts:

• Team - is this the right group of people to deliver on the opportunity?
• Tech - is the technology highly differentiated with a strong moat?
• TAM (Total Addressable Market) - is there a substantial market opportunity?
• Traction - is there a strong indication that customers need this and that there is product-market fit?
• Timing - is now the right time for this technology to be adopted?

Taken together, these five Ts provide a clear lens for assessing opportunities and identifying the startups best positioned to scale.

How should founders handle a "no" from an investor? What's the best way to build long-term relationships, even if they don't secure investment straight away?
The key is to understand the reason behind the "no". If it's something they have heard multiple times from multiple would-be investors, they need to work out why they are getting turned down. It's worth asking for feedback on why they were unsuccessful and then working out whether they can act upon it.

We sometimes turn down opportunities simply because they are too early for us to invest in, not because there's a fundamental problem, but because the business needs more time to demonstrate their traction with customers and growth prospects within their target market. What sends a really powerful signal to us, is if founders understand why it's a no and then deliver a plan to address the reasons behind the refusal.

Founders shouldn't rush to turn a no into a yes overnight. By simply showing that they're taking on board the reasons for being turned down and incorporating those reasons into their growth plan, that's a positive message to investors. In terms of relationships, once a founder feels they have addressed the reason for the no, scheduling a catch-up with an investor is worthwhile.

What startup sector or trend excites you the most at the moment, and why?
The UK has some of the most advanced medtech businesses and it's a space where there's huge opportunity. A very recent example is OrganOx, an Oxford University spin-out whose liver perfusion technology is transforming human organ transplantation worldwide. We saw OrganOx's potential and backed it through seven rounds of funding over six years. Just last month, OrganOx accepted a $1.5bn offer to join Terumo, where it will now benefit from being part of a global leader in the medical devices field.

That's just one example, though. We've also invested in Tidalsense, which has developed an AI-driven device for assessing chronic obstructive pulmonary disease. This equips medics with an accurate and easy-to-use test that measures carbon dioxide levels from just a single breath. Tidalsense is helping to tackle respiratory disease, one of the biggest causes of death in the UK. Another example of the potential in medtech is Cyted, whose technology detects and identifies cancers and inflammatory diseases through a non-invasive test and data-driven biomarkers.

These three examples illustrate the life-saving and transformative technologies in the medtech field that can benefit from long-term, consistent funding – coupled with specialist support and advice – to help them progress from early stage to growth stage and beyond, whilst making a significant impact on people's lives. It's an area which BGF has identified as being underinvested and so we're very excited to be part of the solution to crowd-in more funding for early stage businesses.

Which three start-ups funded by Business Growth Fund this year excite you the most - and why?
OrganOx sold to Terumo for $1.5bn, making it one of the UK's largest ever medtech exits, and it's easy to see why it's been labelled a "unicorn". The transaction generated BGF's largest-ever return. Numbers like that are obviously exciting, and we're proud of what has been achieved. It's especially pleasing to see the results of our willingness to back innovation before it becomes de-risked, and see the fruits of our guidance throughout OrganOX's growth journey, from our first investment in 2019 to our £20m follow-on investment earlier this year.

There's some game-changing technology at Phlux, which has pioneered semiconductors in the infrared sensor sector. In a world where demand for high-speed optical communications is growing enormously, Phlux's sensors can boost transmission speeds by up to five times, enabling industries to push the boundaries of connectivity, sensitivity and efficiency, by removing a technology bottleneck that has persisted for over 20 years. Not only are Phlux's sensors significantly more sensitive than current alternatives, they require less power. There are so many applications, but perhaps one of the most relatable is self-driving vehicles, where Phlux's products can be used in LiDAR (Light Detection And Ranging) systems, which use laser pulses to build up a precise 3D map of what's around them. BGF is committed to finding promising businesses across the country, and this Sheffield-based company is an example of that, with an impressive team poised to disrupt entire industries.

Biotech start-up Maxion also has the potential to change lives. It's developing protein therapeutics to treat previously untreatable diseases such as cancers and autoimmune diseases. We doubled down on our previous backing in a follow-on funding round in the spring because we believe Maxion's breakthrough "Knotbody" technology has the potential to be transformational and appeals to a large global market.

These stories underline why BGF continues to invest in ambitious founders with game-changing ideas. By combining capital with strategic guidance and long-term support, we aim to help more early stage businesses achieve similar impact.