Inspiring Investments Continue with Cutting-Edge Technology - Installment II
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In a significant shift, large companies are showing increasing interest in economic sectors through emerging technologies such as blockchain, cryptocurrency, digital assets, the Internet of Things, and many others. This trend is particularly noticeable in the realm of deep tech startups, which are attracting more investor attention compared to previous years.
The financial aspect of deep tech startups differs significantly from other innovation models, primarily due to their extended development cycles, higher capital intensity, and a need for specialized funding structures. This financial uniqueness is reshaping the innovation funding landscape by fostering new collaborative investment approaches.
One such approach is the growing involvement of corporate venture capital (CVC). Strategic investors from industrial giants contribute not only funding but also technical expertise and infrastructure access, accelerating product development. This is a growing model for deep tech investing, as exemplified by ventures like Lilium receiving substantial support from consortia blending public and private capital.
Another notable development is the rise of public-private partnerships (PPP). Because of the capital intensity and long-term payoff, deep tech funding increasingly involves pooling resources from government, corporate, and private investors. Such collaborations extend development timelines and bridge funding gaps from proof of concept to market launch.
The SiGMA Roadshow, a virtual web-seminar, is kicking off, taking place in a new jurisdiction each month, with a focus on complex conference topics, a small but lively exhibition, and insights from leaders and academics. The Roadshow will tour 14 countries, starting with recently legalized Ukraine, and will be published as a podcast.
The report by BCG and Hello Tomorrow suggests that the deep tech approach is gaining momentum among startups and innovators. A report released by BCG and Hello Tomorrow shows that total investments in Deep Tech have been above average, with investments steadily increasing since 2016, reaching over $60 billion in 2020, an increase of over 11% compared to 2019.
Diversification is a main challenge and driving force for deep tech startups, with more startups expected to rise and secure substantial funding if they aim to address unmet needs in sectors like transportation or energy production. The shift in trend observed in 2020 was the increased participation of corporate investments in this wave of startups.
However, the exclusivity of developed technologies could lead to market privatization, with corporate investors owning shares in patent-protected solutions. This is now shifting towards life sciences and artificial intelligence, with a lack of diversification in sectors and investments in deep tech startups.
In conclusion, the financial model of deep tech startups, characterized by long cycles and capital intensity, contrasts with the faster, more liquid financing in other startup sectors like AI or fintech. This difference is encouraging novel investment collaboration models, which are likely to define the future innovation landscape by balancing patient capital with domain expertise and public-private synergies.
[1] BCG, “Deep Tech: The New Engine of Innovation,” Boston Consulting Group, 2020. [2] KPMG, “Initial Coin Offerings: A Guide for Start-ups,” KPMG, 2018. [3] Accelerator Network, “The State of Startup Accelerators 2019,” Accelerator Network, 2019. [4] CB Insights, “AI Startups Dominate Venture Capital Funding in Q1 2025,” CB Insights, 2025.
- Corporate venture capital (CVC) is increasingly investing in deep tech startups, leveraging not only funding but also technical expertise and infrastructure access to accelerate product development, as demonstrated by ventures like Lilium.
- Another trend in deep tech investing is the rise of public-private partnerships (PPP), as the capital intensity and long-term payoff of deep tech startups necessitates pooling resources from government, corporate, and private investors, such as in collaborations bridging funding gaps from proof of concept to market launch.
