Deep Tech Entrepreneurship in the UK: Current State & Emerging Trends
Written by Natalia Vina, Venture Manager and A.I Stream Lead at Creative Distraction Lab, University of Oxford
Today, we're delving deep into the burgeoning world of deep tech entrepreneurship in the UK, with a closer look at the most compelling trends at the intersection of science, technology, and startups.
Understanding Deep Tech
First, it's worth addressing: what is deep tech? To put it in simple terms, deep tech presents as a technology rooted in scientific discovery. It's a pioneering tech sector whose commercialization and application are in the early stages of development. Now, what deep tech is not concerns a new piece of software or any application using pre-existing digital infrastructure.
The deep tech domain stands alone due to its inherently high risk — a complex mix of standard market risk, commercialization risk, and R&D risk. These risks often make venture capitalists more cautious, as higher hurdles come with this territory.
Golden Age of Deep Tech
The recent spike in emerging foundational technologies affirms a golden age of deep tech on the horizon. Foundational technologies like A.I, quantum computing, CRISPR, and more have evolved to form the basis for the development of additional technologies, making things faster, cheaper, and more advantageous.
Investment in Deep Tech in the UK and Europe
About a quarter of European VC funds go to deep tech, with UK deep tech investment up by 17% in 2020 — the highest global growth rate. The high-volume of top educational institutions has a significant part to play in this growth. Moreover, UK and European universities consistently appear high on rankings for computer science, with the UK punching well above its weight in terms of economy size.
Deep tech spinouts from these universities are also seeing exponential growth, despite relatively unfavourable spinout policies. However, changes are on the ground to foster a more founder-friendly environment. At the University of Oxford, for instance, the policy is now to take only about 20% of deep tech spinouts.
Gender Gap in Deep Tech
Sadly, there's a gender gap in the deep tech sector. Only 15% of deep tech startups are founded or co-founded by women, and female-led teams make up just 6% of the total count. For every £1 in venture capital in the UK, female teams receive less than one pence.
This tells us that there's an evident bias that women can excel in consumer industries, but less likely in deep tech science. In the A.I domain, only 1.5% of funding goes to female-led teams, despite constituting 28% of all A.I companies. Moreover, female-led deep tech co's often face suggestions to hire a "professional" CEO. This manifests into an additional hurdle for female founders in deep tech.
Appreciating the Success of Female Scientists
In light of these challenges, it's time to highlight the achievements of female scientists in the previous century. From Marie Curie winning the Nobel Prize in 1903 for her research on radioactivity to Sarah Gilbert's contribution to the Oxford-AstraZeneca vaccine, successful female scientists have shown time and time again that they can indeed succeed in deep tech.
As we move forward, we hope to see the VC industry recognise these patterns and invest more in deep tech startups led by women. After all, the landscape of deep tech in the UK, and globally, would be incomplete without the contributions of its female pioneers.
Thank you for your attention, and I hope to see you continue to explore the possibilities within deep tech.