Funding supports development of adaptive artificial intelligence for the physical world
London, UK – Stanhope AI, a London-based deep tech startup pioneering brain-inspired artificial intelligence, today announced the close of its seed funding round of $8 million. The round attracted a transatlantic cohort of investors led by Frontline Ventures, with participation from Paladin Capital Group and Auxxo Female Catalyst Fund, and follow-on investment from UCL Technology Fund and MMC Ventures.
This investment marks a significant milestone for the company as it advances its Real World Model – a next-generation framework for adaptive intelligence, designed to function in dynamic, physical environments beyond the limitations of large language models (LLMs).
“We’re moving from language-based AI to intelligence that possesses the ability to act to understand its world – a system with a fundamental agency,” said Professor Rosalyn Moran, CEO and Co-founder of Stanhope AI. “Our approach doesn’t just process words, it understands context, uncertainty, and physical reality.”
Moving Beyond Language: a “Real World Model” for AI
Founded in 2023 by computational neuroscientist Professor Moran, drawing on the work of co-founder, theoretical neurobiologist Professor Karl Friston of UCL’s Institute of Neurology, Stanhope AI applies, the Free Energy Principle, a framework that explains how intelligent systems minimize uncertainty through continuous perception and action.
This brain-inspired paradigm, known as ‘Active Inference’, allows machines to learn and adapt on the fly, which is a crucial capability missing from LLM-based systems that rely on large static data sets.
Stanhope AI’s technology is already being tested in autonomous drone and robotics applications with international partners, teaching machines to behave more intelligently in unpredictable, real-world environments.
Supporting the Shift from Cloud AI to Edge AI
The investment comes amid a global shift from cloud-based AI to on-device systems, as highlighted at CES 2026, where NVIDIA CEO Jensen Huang proclaimed, “The ChatGPT moment for physical AI is here.”
Stanhope AI’s lean, explainable models can run efficiently on-device, using minimal data and energy. This enables deployment in autonomous systems, defense technology, industrial automation, and embedded devices, where efficiency and reliability are mission critical.
“The future of physical AI demands systems that can truly adapt in real-time. The team at Stanhope AI are bringing a unique scientific approach to deliver exactly that, and are already proving themselves in high-stakes, real-world applications,” said Zoe Chambers, Partner at Frontline Ventures. “Their pace of execution, from academic research papers to a system that works safely at the edge, is both rare and deeply significant.”
“We are excited to support Stanhope AI as they redefine the boundaries of machine intelligence,” added Christopher Steed, Chief Investment Officer and Managing Director at Paladin Capital Group. “Their technology showcases the next evolution of AI – intelligent systems that can operate with autonomy, efficiency, and resilience across real-world domains. This aligns strongly with our mission to back innovations that strengthen and secure critical technologies globally.”
Global Momentum and Applications
Stanhope AI’s approach has already drawn attention from international defence and aerospace organisations, where reliability under uncertain conditions is paramount. With this new funding, the company is poised to scale its partnerships and field trials across multiple high-impact sectors in 2026.
About Stanhope AI
Stanhope AI is a London-based, deep-tech startup, a spin out from University College London and King’s College London, co-founded by neuroscientists Professor Rosalyn Moran, and Professor Karl Friston. The team at Stanhope AI has been pioneering a new model of AI since the company’s inception in 2023. Drawing from co-founder Professor Friston’s ‘Free Energy Principle’, the company has been developing an AI for autonomous systems that allow machines to mimic the human brain.
About Frontline Ventures
Frontline Ventures backs the most ambitious tech companies across the US and Europe, and positions them to win the transatlantic market. Frontline Seed backs European Seed startups, when early US traction is critical to hyperscale. Frontline Growth backs US scaleups at Series B–D, when European revenues are essential to IPO-readiness. Portfolio companies include MosaicML (acq. Databricks), Navan (IPO), Pointy (acq. Google), Vanta, and Workvivo (acq. Zoom). Learn more at https://frontline.vc.
About Paladin Capital Group
Paladin Capital Group was founded in 2001 and has offices in Washington DC, New York, London, Luxembourg, and Silicon Valley. As a multi-stage investor, Paladin’s core strength is identifying, supporting and investing in innovative companies that develop promising, early-stage technologies to address the critical cyber and advanced technological needs of both commercial and government customers.
Combining proven investment experience with deep expertise in global security, cyber technology and cutting-edge research, Paladin has invested in more than 85 companies since 2008 and has been a trusted partner to investors, entrepreneurs and governments for over two decades. For more on Paladin Capital Group, follow us on LinkedIn or visit our website.
About Auxxo Female Catalyst Fund
Auxxo Female Catalyst Fund is Germany’s first gender-focused venture capital fund, investing in the next generation of female-(co-)founded companies driving systemic change. With €45 million in assets under management and 35 investments to date, Auxxo backs Europe’s most promising female-led startups at pre-seed and seed stage – combining alpha and impact to back tomorrow‘s category leaders. Auxxo drives equitable participation of women as founders and investors in venture capital – powered by network, experience, and wholeheartedness.
For more information visit, please visit https://auxxo.de/