Deep Tech Startups in 2023: Trends and Transformations
Table of contents
- What is Deep Tech?
- Examples of Deep Tech Startups
- Challenges Faced by Deep Tech Startups
- Quantum Computing's Promising Future
- What Counts as Deep Tech?
- What is Deep vs High Tech?
- How to Choose an App Development Company?
- Cost Estimation at Magora and Case Studies
- Conclusion
Technology today is progressing incredibly fast, and deep tech startups have become major actors that are fostering innovation and changing entire sectors. With the use of advanced technologies such as artificial intelligence (AI), blockchain, quantum computing, and others, these startups are able to resolve challenging issues and provide game-changing solutions. In this post, we'll look at the trends influencing deep tech companies in 2023, their effects on various industries, and the obstacles they must overcome to innovate.
What is Deep Tech?
Deep tech startups are those whose business models are built on significant scientific advancements or high tech technical innovations.
Deep tech startups set themselves apart by concentrating on theoretical and scientific advances. They explore unknown territory and push the limits of what is conceivable. The quantity of deep tech startups has considerably increased thanks to technological breakthroughs and easier access to capital, drawing interest from investors and business executives.
Examples of Deep Tech Startups
CEE deep tech
Here are a few brief examples of CEE deep tech below:
Eventech
A special high-tech event timing that requires 2-3 picoseconds of incredibly precise measurements.
Koatum
Orthopaedic, reconstructive, and dental implants all use cutting-edge medtech bio-active coatings to achieve ultimate biocompatibility.
Arlabion
A startup in the agricultural tech industry invented innovative agricultural chemicals meant to render intensive harvests healthier for the planet.
Conelum
A late-2012-founded biotech business is creating quick microbiological diagnostics for the food and beverage industries.
EIC Accelerator
After the second 2023 EIC Accelerator cut-off in March, a new group of 51 firms have been chosen to receive European Innovation Council (EIC) support, which combines grants and equity.
Out of a total of 551 comprehensive proposals submitted, 139 companies underwent interviews by juries of seasoned investors and entrepreneurs before the companies were chosen in a very competitive process.
Grants and capital investments totaling €260 million will be distributed to the 51 chosen enterprises. Through the EIC Fund, capital investments will be made. The 17 countries represented by the chosen enterprises, including three expanding nations, are distributed geographically. A female CEO, CTO, or CSO is present in 15 out of the 51 organizations, or little under 30% of the total.
Here are a few examples of the cutting-edge initiatives and businesses that will be supported:
- Project SUBRACABLE (Danish “Subra”) is developing superconductive energy systems as a reliable option for Europe.
- Project Twinspect (German “Twinsity”) - first quick and automatically Using AI-based inspection aimed to provide safer operation of huge critical infrastructure, such as bridges, dams, oil & gas platforms, and refineries.
- Project WIDMO cities (Polish “SGPR.tech”) provides comprehensive subsurface data for urban areas.
- Project Adapte (French “Cephalgo”). An advanced and precise emotion identification system for real-time and ongoing health control of patients in psychiatry.
- Project PATS (Dutch “Mu-G Knowledge Management BV”) is an automated system for pest control.
In addition to capital investments made by the EIC Fund that vary from €0.5 to €15 million or more, the EIC Accelerator gives start-ups and SMEs grants totalling up to €2.5 million. All ventures gain from a variety of commercial development services that give access to top talent, corporations, investors, and ecosystem actors, alongside with financial help.
Challenges Faced by Deep Tech Startups
DeepTech marketing launches revolutionary technical breakthroughs onto the market, producing innovative goods that advance society. On the other hand, commercializing deep technology is a challenging and complicated process.
Challenges in Scale and Time
It needs focused R&D to create real business applications and bring them to the market. For instance, the fundamental technology that powers AI was developed by academics over a period of decades, and nevertheless it is not yet perfect.
Another well-known illustration is the Gorilla glass, that is frequently used in smartphones. A thin layer of glass that might be used in a number of applications was Corning's notion in 1950. After years of study and development, the glass finally saw limited application in 2005 when Apple used it in iPhones.
Marketing
Marketing challenges include inadequate market intelligence gathering, inappropriate utilization of such information, and a lack of data on international markets.
In the business sector, the shortage of supplementary company infrastructure and human resources may obstruct commercialization. It may be challenging to define distribution channels and identify partners for this technology because it is new to the market.
Lack of Resources
One of the biggest obstacles to commercialization is money because DeepTech enterprises need greater financing than typical tech startups.
Additionally, investors are unwilling to finance these initiatory-stage technologies since they need the knowledge to evaluate the potential value of the new technologies as deep technology comprises previously undiscovered physics and algorithms.
Industrial and Cultural Concerns
If DeepTech adversely impacts the environment or violates particular industry or cultural laws, commercialization may be hampered by legislative and economic impediments.
As a result of strict restrictions, biotech companies in Asia, for instance, encounter several impediments from the government because this technology raises concerns regarding biological and nutritive safety and morals.
Furthermore, due to their religious beliefs, some people in Asia's different cultures may oppose to the usage of genes derived from specific animals.
Quantum Computing's Promising Future
Quantum computing, with its incredible computational power, is unlocking new possibilities for deep tech startups. Quantum startups are working on optimizing algorithms, building quantum-resistant cryptography, and exploring applications in drug discovery, optimization problems, and complex simulations. Though still in its early stages, quantum computing holds enormous potential for revolutionizing industries.
What Counts as Deep Tech?
Deep tech has had ups and downs, like many other industries, depending on the general environment. Under-the-radar deep tech ended up being even less well-known in the years when widespread adoption of technology began to pick up as expensive applications and other consumer-friendly services and products dominated the spotlight.
The excitement for placing bets on consumer businesses has cooled off as "winners" in that larger category have reached new heights - it's difficult to picture anything substituting Facebook, Google, Apple, or Amazon in the near future, even as other apps gain niche popularity. Furthermore, those investing are once more focusing on firms that use cutting-edge technologies to tackle challenging issues; these startups could end up being the catalysts for significant change.
According to a 2019 analysis from Boston Consulting Group, those factors have fueled an increase in interest in deep technology, with investments in the broader category expanding 20% yearly between 2015 and 2018, reaching a peak of approximately $18 billion in investment.
The growth of VCs with a deep tech emphasis is one indicator of the energy in the sector. Grove Ventures, located in Tel Aviv and investing in businesses throughout Europe and beyond, launched a $125 million investment last month to support deep-tech firms and is currently raising a second fund in the same amount. Grove has supported a variety of businesses, including the fabless IoT semiconductor firm Wiliot, the API marketplace RapidAPI, the startup for autonomous vehicles TriEye, the startup for next-generation manufacturing 3DSignals, and a number of others that are still in stealth mode.
What is Deep vs High Tech?
Deep tech refers to technologies that are based on scientific and engineering research, and have the potential to create significant societal or economic impact. This can include areas such as biotechnology, quantum computing, and energy storage. High tech, on the other hand, refers to technologies that are cutting-edge and involve the use of advanced materials or hardware. Examples of high tech include smartphones, laptops, and drones. In summary, deep tech is more focused on using scientific breakthroughs to solve important problems, while high tech is more focused on creating new products and services using advanced technology.
Artificial Intelligence and Machine Learning:
AI and machine learning continue to dominate the deep tech landscape. Startups are leveraging AI to enhance automation, optimize processes, and make intelligent decisions. From healthcare and finance to manufacturing and agriculture, AI is transforming industries and creating new opportunities for startups to thrive.
Blockchain Revolutionizing Industries:
Blockchain technology has moved beyond cryptocurrencies and is disrupting various industries. Deep tech startups are utilizing blockchain to improve supply chain management, enhance data security, enable decentralized finance, and streamline digital identity verification. The potential for blockchain adoption in sectors like healthcare, logistics, and energy is immense.
Sustainable Solutions and Green Tech:
As environmental concerns grow, deep tech startups are focusing on sustainable solutions and green technologies. Startups are developing innovations in renewable energy, waste management, carbon capture, and sustainable agriculture. Investors are increasingly recognizing the importance of supporting startups that prioritize environmental sustainability.
Cybersecurity and Data Privacy:
With the rise in cyber threats, deep tech startups are addressing the critical need for robust cybersecurity solutions. Startups are developing advanced encryption techniques, threat detection systems, and privacy-enhancing technologies. As data breaches become more prevalent, protecting sensitive information is a top priority across industries.
Collaborations and Ecosystems:
Deep tech startups are increasingly engaging in collaborations with academic institutions, research centers, and industry partners. Such partnerships foster knowledge sharing, access to resources, and mutual growth. Startups also benefit from participating in entrepreneurial ecosystems, where they can access mentorship, funding opportunities, and a supportive network.
Government Support and Policies:
Recognizing the importance of deep tech innovation, governments around the world are implementing policies and initiatives to support startups in this space. Funding programs, tax incentives, and regulatory frameworks are being designed to foster an environment conducive to deep tech startup growth. These efforts aim to drive economic development and maintain global competitiveness.
The Future of Deep Tech Startups:
The future looks promising for deep tech startups. As technologies continue to evolve, these startups will play a crucial role in driving innovation and transforming industries. The convergence of different technologies, such as AI, blockchain, and quantum computing, will unlock new opportunities for startups to create groundbreaking solutions. Additionally, the integration of deep tech in traditional industries will lead to increased efficiency, improved customer experiences, and sustainable practices.
How to Choose an App Development Company?
"How do you find the right app development company?" appears to be fairly well-liked on the Internet. But it also raises a lot of questions. To assist you make a decision, we have summarized the main aspects.
- Competency and Experience
- Recognition and Investments
- Cost of App Development
- Interaction Process
- Client Attention
Cost Estimation at Magora and Case Studies
The Average Cost Breakdown May Look like this:
- Defining a product, strategy and reachable minimum expectations - 16 hours
- UX and visual design - 64 hours
- Programming - 80 hours and QA - 24 hours
- Release - 16 hours
- Total - 200 hours
As you can see, a "primary" application takes 5 weeks of work (excluding preliminary conversations). Development organizations put the cost at between £500 and £1,000 a day. For a 25-day project, the budget is £12,000 to £25,000. The same project carried out at Magora will cost about £10,000. Adding additional functions and skills obviously requires more time from everyone involved and costs will increase accordingly.
Conclusion
Deep tech startups are at the forefront of technological innovation, leveraging advanced technologies to solve complex problems and shape the future. In 2023, these startups are embracing AI, blockchain, quantum computing, and sustainability to revolutionize industries and address global challenges. With the right support, funding, and collaboration, deep tech startups will continue to disrupt traditional business models and drive societal progress in the years to come.
As we look ahead, it is essential for investors, policymakers, and industry leaders to recognize the immense potential of deep tech startups and provide the necessary resources and support to nurture their growth. By doing so, we can collectively unlock a world of possibilities and harness the power of technology for a better tomorrow.
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