Technology company Nomad Digital has raised £6m to fund growth and further investment in its revolutionary wireless broadband connection for trains.

Nomad, which is based in Newcastle, UK, will use the cash injection to continue its growth in European, Asian and US markets and to invest in creating networks such as the world’s longest WiMax roll-out it is building for Virgin Trains in the UK on the 600 km West Coast Main Line.

The successful fundraising – in the form new equity – comes only weeks after Nomad was awarded a major contract to design, supply, install, operate and maintain the Dubai Metro’s passenger internet and station wireless broadband services.

The new funding was led by SEB Venture Capital alongside regional investor NorthStar Equity Investors. Existing investors Amadeus Capital Partners and T-Mobile Venture Fund also followed their investment. This brings the total of funds raised by Nomad this year, despite the economic conditions, to £14.5m, following an earlier successful raising of debt facilities.

This represents another major milestone in Nomad’s progress. The company already leads the global market in mobile WiMax transport communications. It installed the first ever rail broadband system on the UK’s Brighton Express in 2005, is building the Virgin West Coast Main Line and Dubai Metro networks, and has secured several other key contracts to provide mobile internet access services with, among others, UTA in Salt Lake City, NSB Norwegian State Railways and the Heathrow Express.

Nomad’s system is unique in that it provides continuous high-speed broadband coverage, even through tunnels and on underground sections of track.

Its high reliability and scalable capacity not only enable passengers to surf the net and send and receive emails, but the high bandwidth also allows the rapid transfer of large files and groundbreaking applications such as the implementation of real time CCTV. Rail operators can also monitor the performance of their trains and locate all their fleet at any one time – both increasing passenger revenues and enabling real operational cost savings for the operators.

Nomad chief executive Graeme Lowdon said: “The potential market for our systems is huge, with 141,000 trains worldwide, transporting 25.6 billion people every year and this latest funding round gives us the resources to exploit the many opportunities that are out there at a faster rate. 

“The Dubai Metro, one of the most advanced urban rail networks in the world, a driverless, fully automated metro network projected to carry 355 million passengers a year, gives us an opening in the Middle Eastern market. In China, we have just successfully completed trials in Wuhan, one of the country’s biggest cities and we expect, within the next few weeks, to announce a major joint venture in China.

James Raby, investment director for SEB Venture Capital, said: “Set against the background of fuel prices and environmental concerns, there is a renewed focus on investment in rail by public and private operators. Yet train time for most passengers remains commercial and entertainment dead time in the age of multi channel cable and the mobile web. In addition, for the operators, trains are very much a costly, yet unmanaged, asset between depots. Nomad’s proprietary equipment and software solutions, coupled with its proven capability to deliver in demanding operational environments, offers all parties direct and immediate advantages.’’

Alasdair Greig, investment manager for NorthStar Equity Investors, added: “Nomad has an experienced team at the helm and has already made tremendous progress in carving out a leading position in this market. We are proud to be supporting the company in its continued global growth.”

Amadeus Partner Roy Merritt said: “We are delighted with the progress Nomad has made since our initial investment in 2006. Better connectivity is increasingly demanded by the travelling public and by train operators throughout the world; Nomad’s solution is the most cost-effective and proven technology in the market today. The market potential is huge, and Nomad has attracted a strong and expanding group of customers.” 

Nomad was advised on the fund raising by SARDIS Capital and law firm Gordons.