UK start-up Mole aims to make freight pipe dream a reality

Britain may soon have a novel way to tackle road congestion - an underground network of pipes that propel freight-packed capsules to their destination which could lead to fewer trucks on the road.

Mole Solutions, a Cambridgeshire-based company, is working with Northampton council to look at how goods distributed through the town could be transported below ground.

Motors powered by electricity would produce magnetic fields to propel capsules along tracks, all encased within subterranean pipelines.

It might sound like a futuristic idea, but Mole has already been funded by the Department for Environment, Food and Rural Affairs to help develop its concept, and has attracted interest from logistics company DHL, transport and property group Peel Holdings and construction company Laing O'Rourke.

Mole is one of a new breed of start-ups supported by the Transport Systems Catapult, a government-funded centre set up to support innovation in transport. The so-called catapult, which opened last year, is backing about 100 businesses with radical ideas that inject technology into the transport sector.

The Milton Keynes-based centre hopes that among the start-ups will be an idea that has the potential to shake up transport in the way that cab-hailing app Uber harnessed technology to reshape the taxi market.

It also comes at a time when technology is expanding into sectors in a way never seen before, such as Google and Apple's move into healthcare.

"We see a huge opportunity, given the level of disruption and change happening in the transport market," says Paul Zanelli, Catapult's chief technology officer.

Many of the companies have developed ideas to tackle some of the biggest challenges facing transport, such as moving goods and people more efficiently.

A common theme is big data - collating information from multiple sources to gain a greater insight into how transport networks run - allowing planners better control. Other companies are working with autonomous vehicles or the internet of things, the idea that physical objects can be equipped with sensors that feed back data.

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The aim is for the UK to grab a slice of that market and commercialise its innovations, such as with driverless vehicles, which Catapult has had a hand in developing. Mr Zanelli warns that the UK must capitalise on its creativity or it will miss out, giving the example of LCD screens that were developed in the UK but commercialised by Japan.

However, with ideas yet to be substantially tested, the biggest challenge for companies such as Mole is gaining funding to expand their businesses.

Catapult is now aiming to plug the early stage funding gap by launching a specialist investment fund to raise between £50m and £100m to support start-ups in the sector.

"The trouble we're having is [gaining] funding," says Alex Froom, who co-founded Zipabout, which pulls in data from sources such as Twitter to model and predict where there is disruption on transport networks.

The company has tried venture capital and private equity, but investors see the field as "too risky and young an industry", Mr Froom says.

<>Companies such as Zipabout are typically seeking between £250,000 and £5m to run pilot projects, hire staff and open offices.

Steve Yianni, Catapult's chief executive, admits that one of the challenges is to convince investors of companies' business cases. "It's new. They've got some great ideas but they struggle to get traction and they struggle to get access to funding to fuel their growth."

Some will fail, Mr Yianni concedes, but insists that others have the potential to have a huge impact on how people travel; a notion echoed by others observing the growing sector.

"This is really disruptive stuff, as the technology rapidly accelerates there is room for a complete set of new business models," says Matthias Bentenrieder, a partner at consultancy Oliver Wyman.

However, the sector faces challenges, too, in training enough workers in fields such as data analytics, and in gaining vital access to data.

"The UK is a laggard," says Mr Bentenrieder, adding that the US and parts of Europe were among the first to see technology transform transport, for example with the use of car-sharing apps.

Catapult's Mr Zanelli says: "Now is the time to move quickly if the UK wants to get ahead of the world competition."

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