With European Deep tech companies worth around €700B and plans of accelerated growth predicted over the next few years - how are these businesses implementing innovative technology to make an impact on the world and what are the challenges that this industry face?
What is Deep Tech?
The term 'Deep Tech' is the generic term for technologies that aren't focused on end-user services that includes artificial intelligence, robotics, blockchain, advanced material science, photonics and electronics, biotech and quantum computing - this has been an identified category for as long as the tech industry has been around.
Its fundamental aim is to create brand new solutions that can solve society's biggest issues - whether thats chronic disease, climate change, all the way to clean energy and food production. Deep tech has the potential to bring real change to the world, with its cutting-edge technology, and it has the ability to create tangible societal shifts.
With the global pandemic causing an impact on the entire world, the urgency of the current climate crisis and the rapid expansion of global populations have added an extreme strain on an already fragile system - these fundamental issues are what the deep tech industry is designed to address.
The Industries Deep Tech Is Impacting
Deep Tech has been benefitting several industries already, here are just a few examples of the deep tech innovations we thought to mention:
Computing & Processing - Although computers may have evolved at a rapid pace over the last few decades, their design still remains the same. Computers are now a lot more powerful and can cater to the needs of the world - deep tech has the ability to create new ways for processing and computing completely.
With deep tech, it's possible to create custom-built computers that are designed uniquely to solve particular problems. For example, quantum computing is predominantly driven by the increasing adoption of new technologies such as machine learning that requires their own processing and computing resources. So it seems to be more sustainable than the current energy demands of the existing computer infrastructure.
Life Sciences - The health market has accounted for the biggest proportion of deep tech startups (51%) in 2020 - with a significant amount of progress being made within precision medicine, which is allowing technologists and scientists to gain accurate health-based data to develop brand new tailor-made treatments.
Applications for deep tech in this field tend to include AI diagnosis, wearables for health tracking and diagnostics, virtual appointments and even electronic health records, which allow healthcare professionals to personalise treatments for those who need it.
Clean-tech & Energy - The energy sector is always looking for new, innovative and transformative technologies to adopt, so much so, that deep tech companies are almost made for the energy industry. Currently, deep tech companies have turned their attention to hydropower generation and to also boost solar and wind energy.
One of the biggest barriers within the renewable energy space is storage - a lot of deep tech companies are now trying to fix this issue by completely optimising their cloud-based technology and enhancing their batteries.
Infrastructure - It's extremely clear that the world's population is constantly growing exceptionally each year - resulting in governments being under pressure to develop brand new infrastructure, including housing, power plants, transportation and more. However, when governments invest in new infrastructure, they have to comply with different regulations relating to carbon emissions etc.
Since the world needs to expand and grow using sustainable production techniques whilst promoting improved quality of life, urban planners and tech pioneers will need to come together to work towards building a better and greener future using deep tech.
Agri-tech & Food - Food insecurity is one of the biggest issues facing humanity currently. Deep tech solutions can move us away from the traditional farming practices, towards more sustainable methods of production. Loads of new startups have in fact taken the agri-tech space by storm. These companies are turning to exciting new technologies such as biotech, blockchain and big data to create interconnected farming systems.
Challenges of Deep Tech
Commercialising deep tech brings many advanced technological innovations to the market and makes these products benefit society. However, the actual process of commercialising deep tech isn't as straight forward as you'd think, it comes along with many challenges like the following:
Funding plays a big part in the challenges of commercialising deep tech since a lot of deep tech startups require more capital than other general tech startups. Also, since deep tech is comprised of unseen mechanics and algorithms, investors now feel less inclined to fund these systems because they don't have the expertise to analyse the value of the new technologies.
These startups tend to also lack standardisation and third-part certification which will continue to make investors feel skeptical of providing the financial aid that they need.
The commercialisation of deep tech may face legal, cultural and industrial challenges. For example, biotech startups in Asia face many different challenges from the government due to their strict regulations, as it raises concerns over biosafety, food safety and ethics.
Deep tech requires concerted research and development in order to develop practical business applications and bring them from the labs to the market. An example to look at is that it took researchers decades to develop the underlying tech behind artificial intelligence and the tech is still yet to reach perfection - making the process extremely time consuming.
Marketing is another challenge that deep tech faces when trying to commercialise. The marketing challenges usually relate to the failure to obtain adequate market information, whilst failing to use it efficiently as well as insufficient data on international markets.
In the business environment, commercialisation can in fact be hampered by the lack of matching business infrastructure and human talents. Since deep technology is new to the market, training partners and deciding on the methods of distribution can also create challenges for this sector.
Investment in the deep tech sector has been increasing at a steady rate within the last few years. In a lot of industries, the traditional technologies are most likely going to be replaced by brand new technologies such as deep learning, artificial intelligence and many more. Whilst the digital evolution gains more attraction - venture capitalists are going to be investing in more companies operating in the quantum tech, deep tech, blockchain and AI space.
Here at Talented Recruitment Group, we love to see the evolution and progression of different technologies in the ever changing technology market, whilst seeing the many startups forming along side of the top companies within deep tech.
What are your thoughts on the adoption of deep tech? Let us know!