Artificial intelligence (AI), digital twinning, quantum, semiconductors – there are a number of technological advancements currently being developed that require a large amount of time, money and resources, having become known in some circles as deeptech.
The UK government has some ambitious plans for these technologies, but how can we ensure this is achieved?
At a Global Tech Advocates (GTA) event, women who are leaders in deeptech highlighted three important areas to consider: funding, people and patience.
Obtaining funding
The UK government has a lot of hope for the UK’s potential to become a leader in deeptech, having recently announced a £500m Sovereign AI Unit designed to provide venture capital to UK-based AI companies.
Quantum has also been a focus for the UK government, with it announcing it wants the UK to be the first country to deliver quantum computing at scale, investing £1bn to drive research and development to make this a reality.
In fact, Suki Fuller, co-lead of the Tech London Advocates (TLA) Women Leading Tech Group, said we’re currently at an “inflection point”, highlighting government aims for the UK to own 5% of the global chip market by 2030.
But she also cautioned that “momentum doesn’t build itself”, and claimed: “We know what it looks like when opportunities pass, how do we make sure that doesn’t happen again?”
Several speakers explained while government involvement and funding is a step in the right direction, it’s not enough alone to create the tech-led UK the government envisions for the future.
In the words of Janet Collyer, non-executive director and advisor at Mach42: “It will never work if you expect the government to lead. By all means bring them to the table, what is the value of strategic partners? Have them on your board. Nothing happens until somebody sells something.”
Put plainly, Ekaterina Almasque, founding partner, BlankPage Capital, said: “Government and risk doesn’t go together. All these initiatives, they’re admirable, but every time there is something I wonder how it’s going to work, there are so many good intentions behind those initiatives, but in practice we’ve not yet seen a great initiative working.”
Investment and growth needs to come from other areas – venture capital needs to back small businesses looking into how these technologies can be used and developed, firms need to be developing and deploying deeptech, and research needs to be financed and supported.
But one of the factors pointed out by speakers was the difference in the way investment is approached in the UK and Europe versus elsewhere in the world – a large number of startups will be unsuccessful, and the UK’s risk appetite for that is lower.
Almasque said: “Risk capital, the whole model in Europe, doesn’t work because 9/10 ventures will fail and its fine – if we take the risk, we can have more bold outcomes. Nobody knows what will work, but if it works it will save lives.”
Funding for particular projects can be hard to come by, and these issues are exacerbated with deeptech because it’s so experimental and takes a very long time to see results.
Collyer also pointed out that funding is the tip of the iceberg when it comes to building successful deeptech startups.
“The current government has tried to do something, and the thing is what do you do? You don’t just have a helicopter and drop the money down, because they will fail as well,” she said. “It has to be structured.
“Theres a lot of money that is coming into the UK, and the improved relationship with Europe means that we will have funds coming this way as well.”
Collecting the right people
The fear of failure that prevents investment into deeptech is also a cultural issue across the UK technology sector as a whole.
Sue Daley, director of technology and innovation at TechUK, explained: “It’s culture as well, right? Fail fast, pick yourself up and move.
“In the public sector you have to account for the money; in the private sector you have that, it’s a very British thing I think, that shame of failing and therefore not wanting to try again,” she said. “We need to find a solution – how do you change that culture? How do you instil that it’s OK to fail, but it’s picking yourself up and getting going again that’s the important thing.”
Not only does this fear of failure prevent investment in certain types of technology, it also prevents women from shooting their shot for funding, which is an issue when considering female entrepreneurs already receive less funding than their male counterparts.
But Fuller pointed out that women are needed in the deeptech sector as entrepreneurs, advisors and investors – much like the development of other technologies, it’s important to have people from different perspectives and backgrounds working collaboratively on development to ensure technology is suitable for its target uses and audience.
This is especially important for deeptech, which Fuller stated is not “fluffy” tech, but in fact the basis for the future.
She said: “I think sometimes culture has made [women] more risk adverse, but as my grandmother always says, no day is promised, so why not fail today, because you don’t know if you’re going to have tomorrow.
“We have women in the community that are heavily filled with all this knowledge and experience within the deeptech sector, and we are very much siloed. What we want to do is make sure we all know each other because we’re all out there.”
Both Fuller and Clare Schramm, managing director of transaction banking technology platforms at Lloyds Banking Group, went on to say people hoping to take part in the deeptech sector in any capacity need to have the right “mindset”, with Schramm saying: “I think it’s really important getting more of an innovation mindset, tolerating risk, tolerating the potential that a partnership could fail, a business could deviate, that plans may change.”
Zahra Shah, AI and frontier technology expert, has seen people fail without having the right attitude and character, stating: “I’ve seen if you have the wrong kind of character trait for a founder or entrepreneur – no matter how much money they make, no matter how much access to compute they have – if they don’t have the temperament, they’re not going to succeed.”
Investors not only have to believe in the idea and technology they’re investing in, they also have to believe in the people they’re investing in to deliver what has been promised – Collyer explained: “When you talk to most investors, they really start with the team.
“There’s a level of pragmatism that’s coming up, and I see that with investors, and that’s why the team is so important. The tech is proven – that’s good – but the team is the one that’s going to get it over the line. What does it take to be successful?”
Patience is a virtue
The slow speeds deeptech can take to develop often means investment stalls because these projects aren’t delivered as quickly as an investor might like, increasing the feeling of risk, but deeptech takes time, and experts at the Global Tech Advocates event urged having more patience.
One panel member pointed out it can take 15 to 20 years for even the largest companies to perfect a technology, so why rush deeptech ventures?
Schramm said: “Putting [deeptech companies] through the same paces you would put a large enterprise or a FTSE 100 through doesn’t work.
“We have to be able to take more risk, we have to accept the risk, we have to be comfortable we won’t be as mature in some areas but be comfortable there will be a path to risk mitigate.”
Venture capital cannot invest in these technologies and expect a project to be done in a year – it takes “much longer than the noise we hear for the last two, three years” about AI and other emerging technologies, said Harini Gopalakrishnan, founder of TheHaze.
“Having to scale up deeptech really is about playing the long game,” she said.
Not only was patience with deeptech development advised, but Christina Yan Zhang, CEO of The Metaverse Institute, claimed the tech sector needs to have a little more patience with government.
“We need to be a little bit more patient with government,” she said. “We all know the global economy is a little bit slow, not because the government is not working hard, but because we have some uncertainty in the Middle East.
“All governments were overspending during the pandemic to save people’s lives – that’s a medical emergency. In Britain, we have a saying: ‘Keep calm and carry on’. Maybe sometimes we need to be like that towards governments.”
