Deep tech startups are companies whose business model is based on developing disruptive solutions to address global problems using innovative technology linked to advances in science and engineering.
These types of startups are experiencing a moment of great interest from venture capital funds, as reflected in the increase in investments over the last decade. Although they have traditionally been unattractive to funds due to the long time required for them to deliver returns, the current landscape indicates that these startups are one of the strongest investment alternatives.
According to the US fund Draper Cygnus, venture capital investment in deep tech has risen from 10% to 25% in the last 10 years and current valuations of these startups worldwide now total $468 billion, or €424 billion.
The development of solutions based on rapidly-growing technologies such as the Internet of Things (IoT), edge computing or Big Data requires years of research and validation, which can affect a VC’s decision making. However, according to data from Draper Cygnus, these startups now only take an average of 5 years to become unicorns, with a capital of $115 million.
With this data, it is not surprising that the renowned consulting firm Gartner places them at the centre of its radar of most impactful emerging technologies this year and that. On an international level, 2022 is being talked about as the year of deep tech in Europe, as opposed to other sectors that are becoming saturated.
At the national level
GoHub, which is Startup Valencia’s Global Partner. Stands out as one of the funds specialising in this type of company called upon to modernise the economic network and the production model. Global Omnium’s corporate venturing fund analyses around 1,500 deep tech startups throughout the year and has 30 million euros to invest in these types of projects, like venture capital.
The fund invests in B2B SaaS solutions focused on improving process automation and currently has a portfolio of 21 invested startups, 4 of which are part of its acceleration programme, indeed.
The value of deep tech startups
Patricia Pastor, CEO of GoHub, explains that the innovative value of them “is exponential given that they are able to solve extremely complex problems”.
“One of their great powers, is that they enable the digitisation and automation of industry, and one percent more digitisation is worth millions of euros. In short, they make industry more efficient, predictive and cost-effective.”-She adds.
Applications of deep tech technologies
Within GoHub’s commitment to these technologies based on advanced engineering you can find the Catalan startup AllRead MLT. So, they use deep learning and artificial vision to capture and extract valuable information in operational environments. A solution already being used in State Ports that allows the pervasiveness of traceability in port facilities, by lifting the financial and technological barriers to its adoption.
Aunoa, led by José Manuel Sanchis, is a project that stands out in the portfolio of Global Omnium’s investment fund. The startup developed an AI chatbot to serve customers in a faster way, 24 hours a day, 7 days a week, on different messaging platforms. The tool has already been deployed at Emivasa, the water supply company in Valencia.
Finally, another good example is Barbara IoT. The startup led by David Purón uses Edge computing to enable the use of real-time data from sensors placed on multiple devices in a facility or infrastructure. This system is being used by the Cuerva Group in its electricity transformation centres to optimise operation and maintenance processes in the medium and low voltage network.
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