In recent years, the term “deep tech” has emerged as a powerful force in the technology landscape, driving innovation across numerous industries. Unlike mainstream or consumer-focused technologies, often referred to as “shallow tech,” deep tech represents a more profound and transformative approach to technological advancement. This article explores what deep tech is, how it differs from other technologies, and why it’s becoming a focal point for startups, investors, and innovators worldwide.
What is Deep Tech?
Deep tech refers to highly sophisticated technologies that are deeply rooted in advanced scientific principles and engineering innovations. These technologies, also known as “hard tech,” rely on years of extensive research and development, requiring significant technical expertise to bring disruptive new products to market. Deep tech companies are often engaged in fields such as artificial intelligence, biotechnology, quantum computing, and beyond — including agriculture, aerospace, green energy, and mobility.
While some deep tech companies have become household names, like Moderna, Tesla, and Impossible Foods, others are turning what was once considered science fiction into reality. Examples include SpaceX’s Starlink internet satellites and Boston Dynamics’ humanoid robots. Regardless of the industry, deep tech companies are unified by their mission to tackle some of the most pressing challenges facing humanity today, including climate change, illness, and food insecurity.
As Arnaud de la Tour, CEO of deep tech accelerator Hello Tomorrow, noted: “When we have deep tech startups in general, we know that we are making the world a better place.”
How is Deep Tech Different from Other Technology?
1. Deep Tech Requires More Research and Development
One of the most distinguishing characteristics of deep tech is its heavy reliance on research and development (R&D). Deep tech startups require significant investment in R&D and a much longer timeline for return on investment (ROI). The risk is also higher, as some projects may prove to be commercially or scientifically unviable. In contrast, traditional tech companies often utilise established engineering techniques to address existing market needs, using existing software frameworks that are easier to commercialise.
As de la Tour explained, “You can develop a mobile app and have it up on the app store in a few months, but building a new low-Earth-orbit satellite, for example, takes much longer. They need to go through a significant R&D phase before reaching the market and getting some revenue from paying customers.”
2. Deep Tech Requires Specific Talent and Expertise
Another critical difference lies in the specific talent and expertise required by deep tech companies. These companies often need highly skilled professionals with specialised expertise — and such talent is usually in short supply. For instance, a deep tech company funded by WNT Ventures is searching for electrochemists with a unique skill set possessed by fewer than a dozen people worldwide, according to managing partner Maria Jose Alvarez.
This scarcity of talent is a defining challenge for deep tech companies, emphasising the need for strong partnerships, networks, and strategic alliances to access the required expertise.
3. Deep Tech Faces Less Market Competition
Despite the challenges, deep tech companies often enjoy a significant competitive advantage when they finally reach the market. Tess Hatch, a partner at venture capital firm Bessemer Venture Partners, explains: “While there’s more capital required and a longer feedback cycle, you really make that up in a deep and wide competitive moat — in patents, in technology, and in your team.”
In contrast, traditional tech companies, particularly those in sectors like SaaS or consumer tech, face intense competition because their technological advancements are easier to replicate. For example, while Netflix revolutionized the entertainment industry, it now faces competition from Hulu, Amazon Prime, and many other platforms. Similarly, Facebook (now Meta) may have pioneered social media, but it now competes with Instagram, Twitter (now X), TikTok, and others.
4. Deep Tech Measures Success by Reaching Milestones
Deep tech companies measure their success differently compared to traditional tech firms. While traditional companies often focus on metrics like customer acquisition, churn rates, and revenue growth in their early stages, deep tech companies prioritise technological milestones and the development of intellectual property. Achieving regulatory approvals and complying with industry standards can also be critical success factors, depending on the field.
Ultimately, the most important metric for deep tech companies is their ability to push humanity forward. Deep tech’s goal is to create solutions that inspire further discovery and benefit society, shaping the future in ways previously considered impossible. As Alvarez from WNT Ventures put it, “For a company to be true deep tech, it must open new frontiers. I don’t think there’s another way to solve the biggest issues if it’s not with deep tech.”
Why is Deep Tech a Good Opportunity Today?
Deep tech represents a unique and compelling opportunity for startups, investors, and innovators today. As the world faces increasingly complex challenges — from climate change and pandemics to food security and sustainable energy — the demand for groundbreaking technologies has never been higher. Here are a few reasons why starting a deep tech company is a promising venture:
- High Impact and Purpose: Deep tech startups are mission-driven, aiming to solve some of the most pressing global challenges. This focus on creating meaningful impact attracts both top talent and investment.
- Strong Competitive Moat: With their reliance on cutting-edge science and technology, deep tech companies build substantial barriers to entry, protecting them from competition through intellectual property, patents, and specialised expertise.
- Growing Investor Interest: Venture capitalists and investors are increasingly looking toward deep tech as a high-reward sector. The potential for groundbreaking discoveries and solutions makes it an exciting area for investment, despite the associated risks.
- Long-Term Vision: Unlike traditional tech companies that may focus on quick wins and immediate market traction, deep tech firms operate on longer timelines with a broader perspective. This long-term approach aligns well with solving fundamental challenges and creating sustainable value.
Conclusion
Deep tech is not just another buzzword — it represents a transformative shift in how technology can be used to address the world’s most pressing problems. By leveraging advanced science, engineering, and years of research, deep tech companies are pushing the boundaries of what is possible. Whether it’s developing new medical treatments, creating sustainable food sources, or revolutionising communication, deep tech is paving the way for a brighter, more innovative future.
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