What is deep tech
Definition may vary, but deep tech is commonly technology built on substantial scientific or engineering breakthroughs: solutions that represent a genuine paradigm shift in how a problem is solved, not an incremental improvement.
I use the word "transformative" a lot in my day job, usually as marketing language. Here, I think it's just accurate.
Deep tech companies typically have:
- Long R&D cycles, and
- Large capital investment required ahead of commercialisation
As such, a deep tech company is normally IP rich.
Why we need it
1) Technology and innovation are embedded in our lives
Some of the biggest step changes in human history have come from exactly this kind of breakthrough:
- Fire and early tool use
- The wheel and agriculture
- The printing press (~1440, or before 868 AD in China)
- The steam engine and Industrial Revolution (~1700s)
- Electricity (late 1800s)
- The microscope
- Antibiotics and vaccines
- The transistor and semiconductors (1947)
- The internet (1990s)
- Human genome sequencing (2003)
- Space exploration (1960s onwards)
It's incredible to see how far we've come, and yet how much further we can go.
2) Environmental challenges and sustainability for the long term
Many of the biggest constraints we now face aren't solvable by better software or business models alone, they're bound by physics and resource limits. You can't optimise your way past the carbon intensity of steel and cement, or the physical limits of a battery chemistry. Closing that gap needs new science: fusion and next gen fission for clean power, novel materials for storage and carbon capture, and synthetic biology for food and industrial inputs.
3) Geopolitical competitiveness
Frontier science increasingly determines national and economic power, not just academic prestige. Semiconductors, AI compute, quantum computing and space capability are now treated as strategic assets, and governments increasingly see deep tech as core to national security and economic competitiveness, not a nice to have. Countries and blocs that lead in these technologies shape the standards, supply chains and defence capabilities everyone else has to operate within.
Sectors
Traditionally more concentrated in aerospace and defence, healthcare, and semiconductors. In recent years also quantum, fusion, robotics, augmented reality, and of course AI.
Risk
- Technical risk (lab to market) first, need to understand de-risking cycles
- Commercial risk (growth curve), assumed lower given the clear potential value of the solution to society, but use cases still need to be proven
- Economic risk, needs to be better and cheaper than classical means
What it takes
Given the risk profile above, progress needs government and private sector effort working together. Government funding and procurement often carries the technical risk in the earliest stages, where returns are too long dated or uncertain for most private capital. Private capital then scales what works, bringing commercial discipline and speed once technical feasibility is proven. Beyond funding, this also means building out the full ecosystem: supply chain, specialist talent, and a regulatory framework that keeps pace with the technology.
Trend on capital
Deep tech investment has scaled sharply. Deep tech companies raised $177bn globally across 2,650 rounds in 2025, up 82% year on year, with the sector now home to 336 unicorns. Its share of total VC funding has roughly doubled over the past decade, from around 10% to about 20% today (BCG). In Europe, deep tech is now the single largest VC category, capturing 28% of all funding in 2024, a record share.
- UK DeepTech Startup Index, tracks UK deep tech company and funding data: https://www.deeptechindex.uk/
- XB100, XPRIZE and Bessemer Venture Partners' ranking of the world's top 100 private deep tech companies: https://www.bvp.com/xb100#xb100-list
Selected Sources
- https://en.wikipedia.org/wiki/Deep_tech
- https://www.hsbcinnovationbanking.com/gb/en/resources/demystifying-deep-tech
- Deep Tech, Demystifying the breakthrough technologies that will evolutionise everything
- BCG, An Investor's Guide to Deep Tech
