Literal Labs, a UK-based AI company pioneering logic-driven algorithms, has raised £4.6 million in pre-seed funding to accelerate the commercial rollout of its energy-efficient, high-performance AI platform. The round was led by Northern Gritstone, with co-lead Mercuri, and participation from Sure Valley Ventures, Cambridge Future Tech SPV, and angel investors.
Founded in 2023 as a Newcastle University spin-out by Dr. Alex Yakovlev and Dr. Rishad Shafik, and now led by former Arm executive Noel Hurley, Literal Labs offers an alternative to GPU-heavy neural networks. Its models, built on the Tsetlin machine and based on propositional logic, deliver faster inference, lower energy usage, and greater explainability.
Benchmark results show Literal Labs’ models are 54 times faster and 52 times more energy-efficient than conventional neural networks, and up to 250 times faster than XGBoost. These advantages position the platform as a compelling solution for industries constrained by compute budgets or regulatory demands.
Hurley described the company as being “at a pivotal moment” in AI, adding that “our logic-based approach delivers the performance, efficiency, and transparency increasingly demanded by both innovators and regulators.” The company plans to launch its first commercial product in 2025 and will use the funding to expand its engineering team.
Investor confidence in Literal Labs is rooted in its early performance and leadership. Esha Vatsa, Partner at Mercuri, said Literal Labs is redefining AI with a radically efficient alternative to neural networks. Duncan Johnson, CEO of Northern Gritstone, added that this is the company’s first Newcastle University-linked investment, and they were proud to support an innovation poised to reshape AI infrastructure.
Literal Labs has also appointed Leon Fedden, formerly of AstraZeneca, as Chief Technology Officer as it scales its platform for real-world deployment.
Featured image: Credit: Literal Labs
