New Cambridge University spin-off, Tenison Technology, has secured £700,000 investment from a syndicate led by Axiomlab.The money buys 13 per cent of the new company, which designs software for hardware and software engineers to work together when developing microchips.Its VTOC software reduces cost and time involved in semiconductor design and is already in use at 11 companies around the world.

This is Axiomlab's first investment in Cambridge and the syndicate it heads includes Sigma Technology Venture Fund, Cambridge angel Robert Sansom, and Providence Investment.

Dr Sansom joins the board of Tenison as chairman, and Fred Mendelsohn of Axiomlab and Keith Monserrat of Sigma become directors, all of them non-executive.

Tenison was founded by Dr David Greaves two years ago as a spin out from the university's computer labs.

Previously he co-founded Virata, the Cambridge chip design company acquired last year for more than half a billion dollars.

Dr Sansom co-founded Fore Systems in 1990. It was sold in 1999 for 4.5 billion dollars.

Chief executive of the new company is Jeremy Bennett, who comes from Marconi, with Willam Stoye chief technology officer. Dr Greaves is chief scientist.

Axiomlab says it intends Tenison to be the first of further investments in the region.