GLOBAL INVESTMENT IN PRIVATE INVESTMENTS IN DEEP

DEEP TECH HAS SOARED

TECH COMPANIES ($MILLIONS)
17,886
Investors are paying more 16,407
attention to novel technologies 14,509
that advance frontiers and
address big needs and problems
9,854
22% GROWTH,
2015–2018

2015 2016 2017 2018

Where’s the deep tech money going? Seven fields

feature the most active and promising technologies.

PRIVATE INVESTMENT DISCLOSED PRIVATE

ROUNDS, 2015–2018 INVESTMENTS, 2015–2018

BIOTECHNOLOGY 1,253 $
18.6B
ARTIFICIAL
INTELLIGENCE 1,081 $
14.5B
PHOTONICS AND
ELECTRONICS 822 $
11.2B
DRONES AND
ROBOTICS 791 $
8.0B
ADVANCED
MATERIALS 536 $
5.5B
BLOCKCHAIN 120 $
839M
QUANTUM
COMPUTING
7 $
123M

THE DEEP TECH OPPORTUNITY IS GLOBAL

US companies are attracting almost half of investments,
but funding in other countries is growing much more quickly

73% 103
4 Sweden
Iceland 33 23
435 Norway 3 Russia
312 United Estonia
Canada 47% 455
Kingdom
Germany 1
Kazakhstan
241
4,198 France 81%
10% United States 746 329
1 2
3 Tunisia 195 Iran China South 103%
Bermuda Israel Korea
4 3 129
Cayman Islands United Arab India
Emirates 1
Philippines
2 1
Colombia Cameroon 65
Singapore
8
GROWTH, Brazil
2015–2018 2 107
Chile Australia
7
1 South Africa
Argentina
26
New Zealand

THE NEEDS OF DEEP TECH STARTUPS VARY BY TECHNOLOGY…

Including the necessary funding and time required to bring a product to market
AVERAGE FUNDING TO INCORPORATION PROTOTYPE
BUILD FIRST PROTOTYPE TO PROTOTYPE (YEARS) TO MARKET (YEARS)
$
1,269,508 BIOTECH 1.8 2.2

$
1,208,579 ADVANCED
MATERIALS 1.9 1.8

$
782,727 PHOTONICS AND
ELECTRONICS 2.1 1.6

$
614,387 ARTIFICIAL
INTELLIGENCE 2.0 1.4

$
457,976 DRONES AND
ROBOTICS 1.7 1.2

$
217,755 BLOCKCHAIN 1.4 1.0

Startups also need access to different resources as they mature

RESPONDENTS WHO PARTICIPATED IN THE 2018 HELLO TOMORROW CHALLENGE

FROM IDEA TO EXPERIMENTAL PROOF OF CONCEPT (TRL 1–4)

PROTOTYPE AND MINIMUM VIABLE PRODUCT (TRL 5–7)
INDUSTRIALIZATION AND COMMERCIALIZATION (TRL 8–9)

88% %
84
77% 70 78%
%

52 %
53%54 %

42% % 43% %
41 % 40 40%
33 34% 34% 31%
23% 28% 27% 28%

20% 20 %
21% 22 % 22 %
25 %
16%
13% 11%

Funding Business Technical Technical IP, legal, and Lab and Midstage Market access Visibility and Talent
knowledge and expertise expertise (for financial testing beta testers (e.g., customer credibility
expertise (for R&D) industrialization) expertise facilities base, distribution
network)

MOST CRITICAL FOR MOST CRITICAL FOR

EARLY-STAGE STARTUPS MATURE STARTUPS

ALL OF THESE NEEDS ARE

CAUSING A DYNAMIC DEEP TECH
ECOSYSTEM TO TAKE SHAPE
While money is one important currency, CORPORATIONS USERS
knowledge, data, skills, expertise, contacts,
and market access are also valuable means
of exchange for ecosystem players
UNIVERSITIES
AND RESEARCH STARTUPS FACILITATORS
CENTERS
MONEY
KNOWLEDGE
DATA
SKILLS
EXPERTISE
CONTACTS GOVERNMENTS INVESTORS
MARKET ACCESS

1 2 3
THE RULES OF
THE DEEP TECH WHAT DO WE WHAT DO WE HOW DO WE INTERACT
ECOSYSTEM BRING TO THE WANT FROM THE WITH OTHERS TO
ECOSYSTEM? ECOSYSTEM? ACHIEVE OUR GOALS?
Companies, investors,
Ecosystems operate All participants New technologies,
startups, and others should on a win-win model. should be clear on startups, and ecosystems
be guided strategically by Each participant why they are all face highly uncertain
needs to think about engaging with the paths. Executives must
three questions about its own goals and how ecosystem and what therefore rethink
themselves and their goals it can help the whole they hope to achieve. textbook management
ecosystem advance. techniques.

Sources: This infographic is based on The Dawn of the Deep Tech Ecosystem, a BCG and Hello Tomorrow report, March 2019. Deep tech companies were identified based on relevant patent filings and
scientific literature publications since 2000 either by the company or by its key team members. Data comes from the BCG Center for Innovation Analytics, Capital IQ, the Hello Tomorrow Global Challenge,
Derwent Innovation, and Quid. The analysis relied on in-depth interviews, market research, examinations of funding, patent and publication data, and exclusive data from more than 2,000 deep tech startups.
Notes: Private investments are based on transactions with disclosed amounts. About 41% of private investments in deep tech companies remain undisclosed. The analysis of deep tech investment is
based on 8,682 deep tech companies related to 16 technologies across seven categories. Greater China includes the People’s Republic of China, Hong Kong, Macau, and Taiwan. The analysis of startup need
is based on data from 1,646 deep tech startups that qualified for the second round of the Hello Tomorrow Challenge in 2018 (from 4,500 applications). TRL = technology readiness level on a NASA-originated
scale of 1 to 9.

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© Boston Consulting Group & Hello Tomorrow 2019. All rights reserved. 4/19.