Deep technology or deep tech is a term used to describe startup businesses that are based on tangible engineering innovation or ground-breaking scientific discoveries. These startups operate broadly across industries like agriculture, life sciences, chemistry, aerospace and green energy. Deep tech fields such as Artificial Intelligence (AI), advanced materials, blockchain, biotechnology, robotics, drones, photonics, and quantum computing are swiftly moving from early research to market applications.
Characteristics of Deep Tech Startups
Deep tech innovations are radically inventive and can either disrupt an established market or create a new one. Innovations drawn from deep tech have the potential to transform lives, economies, and societies worldwide. However, the time taken for deep technology to develop and reach the market is often longer than for non-deep tech products, like websites or mobile apps. For instance, it took decades to develop artificial intelligence, which still has room for progress. Also, deep tech usually requires substantial early-stage funding for research and development, hypothesis validation, and technology development.
The Current State of India’s Deep Tech Startups
As of the end of 2021, India had a rich landscape of over 3,000 deep-tech startups. Examples of these businesses utilize technologies like AI, Machine Learning (ML), the Internet of Things, Big Data, quantum computing, and robotics. NASSCOM reports that these Indian deep-tech startups raised USD 2.7 billion in venture funding throughout 2021, accounting for over 12% of India’s overall startup ecosystem. The Indian deep tech ecosystem has seen significant growth of 53% over the last decade, putting it on par with developed markets like the US, China, Israel, and Europe. Bengaluru alone accounts for between 25-30% of India’s deep-tech startups, followed by Delhi-NCR (15-20%) and Mumbai (10-12%).
Challenges Faced by Indian Deep Tech Startups
While deep tech’s potential is vast, startups in this field face substantial challenges in fundraising. Government funds are often underutilized, and domestic capital for these startups is scarce. Other factors like access to talent and markets, research guidance, understanding of deep-tech among investors, customer acquisition, and high talent costs also pose significant challenges.
Related Initiatives towards Deep Tech Development
India has initiated schemes like the Atal New India Challenge under the Atal Innovation Mission (AIM) of the Niti Aayog which promotes Innovation Hubs, Grand Challenges, startup businesses, and other self-employment activities, especially in technology-driven areas. Moreover, NASSCOM’s Deep Tech Club (DTC) 2.0, launched in 2021, aims to scale the impact of more than 1,000 firms that are leveraging technologies such as AI, ML, Internet of Things, robotics, and blockchain.
Suggestions for the Way Forward
As the continual growth of the Indian start-up ecosystem is fueled by the ongoing era of constantly emerging new technologies, organizations and the government would need to reevaluate their roadmaps for adopting deep tech. Key future technologies, such as 5G, understandable artificial intelligence, quantum computing, cloud-native technologies, cybersecurity meshes, and customer data platforms, will be especially important. Utilizing Corporate Social Responsibility budgets could provide additional support for strategic technologies, encouraging large corporations to contribute to the strategic needs of the nation. Finally, easing regulatory restrictions to allow these funds to flow into strategic tech startups could further fuel this burgeoning field.
