Tomoko Yokoi, Contributor | Forbes | Jan 28, 2025
Venture capital and private-equity funding for deep tech promising to address society’s greatest challenges has doubled its share globally in the past decade. Moreover, governments are increasingly prioritizing deep tech, which is often “dual use”—applicable in both civil and military contexts—through industrial and security policies designed to reduce reliance on foreign technology and promote a nation’s security. This decisive moment demands new collaboration models among research institutions, firms, and governments to create innovation ecosystems capable of supporting long-term technological breakthroughs. This growing emphasis on deep tech raises important questions.
A key question to start with is: what exactly is deep tech, and how do its ventures differ from the more familiar realm of digital innovation? According to deep tech scholar Stefan Raff-Heinen, three defining attributes set deep tech apart.
One feature of deep tech is its foundation in the scientific development of novel technologies, often described as “first-of-a-kind” innovations that build on cutting-edge research. This contrasts with digital ventures, which typically rely on “difference-in-kind” innovations, recombining existing digital platforms to create new products or services. Additionally, deep tech ventures face a dual risk landscape, grappling with not only commercialization challenges but also technological and engineering challenges. Finally, deep tech ventures are built around hardware assets and are typically centered on highly defensible intellectual property (IP), providing a significant competitive advantage.
How can Corporates Unlock Deep Tech?
Another critical question is how organizations can unlock the potential of deep tech as a frontier for radical innovation. Identifying the sectors most likely to benefit is a vital starting point. In this regard, Raff-Heinen explains, “Deep tech innovation can benefit a wide range of sectors, not just the traditionally ‘science-heavy’ industries. Sectors such as financial services, infrastructure, and retail – where spending on research and development is traditionally comparatively low – can also benefit.” The challenge, however, lies in the fact that many organizations with limited R&D budgets are often unaccustomed to working with emerging technologies. To address this, Raff-Heinen, Murray, and Murmann outline three practices to help overcome common barriers such as commercialization risks, high capital investment requirements, and mismatched timelines.
