The funding round was led by venture capitalists Braveheart and included the Scottish Co-investment Fund.
This is the second round of funding for the company, having previously received £600,000 in May 2005, which also came through Braveheart.
MicroStencil, based in Livingston, Scotland, spun-out from the Heriot Watt University in 2003.
It manufactures stencils used to create ultra-fine electrical and mechanical connections for microelectronics devices
Demand for such products is being driven by the growing use of new devices such as small and lightweight mobile phones, digital cameras, MP3 players and laptops.
The funding will be used to expand production in order to meet international demand in markets such as North America and Asia.
Gwyn Pugh, of Microstencil said: “This new funding from our original investors demonstrates their confidence in what we have achieved to date and in our future success.
“The investment will enable us to increase our production capability, a vital step forward for our ambitions for the business.”
Recently, the Microstencil signed an agreement with DEK International which will distribute the company’s products in Asia and America.
“We are also delighted to announce the signing of a product distribution deal with global market leader, DEK International,” added Pugh.
“DEK’s extensive sales and support infrastructure will provide us with the ideal platform to successfully introduce our products to the high volume customers who dominate the Asia Pacific region, crucial to the success of our business.”
© Crimson Business Ltd. 2006