Deep-Tech Startups — Bedrock and Growth Engine of a nation’s Future

Deep-Tech startups tend to create physical products rather than software. They are not interested in building an aggregator model but more concentrated on bringing physical products to life

What does Deep-Tech mean?

Deep-Tech or Deep-Technology is a category of startups whose business model is based on making tangible engineering innovations or scientific advances and discoveries.

Though Deep-Tech startups have a promising future, they face difficulties in scaling up. It is a herculean task to take these deep-tech products from lab to market, startups need to first prove themselves by overcoming engineering and design challenges while meeting cost limitations.

Why backing Deep-Tech startups become so necessary?

Deep-Tech startups are extremely crucial for the national security of any nation. It has become increasingly evident globally that the governments are supporting, funding, and promoting self-reliance in sectors like space infrastructure, semiconductors, 5G, and defense. It is indispensable for any country to latch onto this fourth wave of innovation which utilizes technologies such as Biotechnology, Nanotech, or Quantum Computing, and so on.

While the deep-tech trend is picking up around the globe – it is largely limited to Artificial Intelligence and Machine Learning (AI-ML) fields which are based on deep data analytics.

As of 2020, India had about 2100 Deep-Tech startups (Source: Nasscom). Unfortunately, unlike in the US – where a lot of deep-tech ventures are being produced out of academic research, such ventures continue to be sparse in number in India.

What differentiates Deep-Tech startups from typical startups?

Many innovations in important societal sectors like healthcare, energy, environment, nutrition, agriculture, etc., rely heavily on know-how, insights, and foresight drawn from scientific research and development.

These innovations have different risk profiles, timelines, know-how and facility requirements, resourcing requirements, etc.

These innovations often need a different approach and strategy to advance them from the stage of developing ideas to investment readiness and market-ready products.

This is one reason why typical investors or VC firms who expect a return on their investment in a shorter time frame of 3-5 years, are not able to appreciate Deep-Tech ventures – where it is difficult to realize returns in such a short timeframe.

Generally, Deep-Tech startups tend to create physical products rather than software. They are not interested in building an aggregator model but more concentrated on bringing physical products to life.

Their focus is generally on solving significant and fundamental issues. For example, a startup is developing a device that can bring cervical cancer screening to every woman’s doorstep and ensure timely detection.

Deep-Tech Startups own patents and trademarks and generally work at the convergence of two or more technologies. Deep-Tech startups develop around research-based ecosystems such as Universities, research facilities etc.

What is the government of India doing to promote Deep-Tech Ecosystem?

The Government of India (GoI) is playing a significant role in the Indian Deep-Tech innovation ecosystem. In the very early stages, GOI offers support to startups in deep tech space through bodies like BIRAC (Biotechnology Industry Research Assistance Council), CSIR Labs, Department of Science and Technology (DST), Department of Biotechnology (DBT), and facilities such as C-CAMP that are building a superb conduit.

The Atal Innovation Mission (AIM), a flagship initiative for innovation and entrepreneurship from NITI Aayog, runs a number of programs to bolster the Deep-Tech Innovation cycle in India.

One such initiative was AIM-PRIME in collaboration with the Bill & Melinda Gates Foundation (BMGF). This is a nationwide program implemented by Venture Centre - a non-profit technology business incubator based out of Pune and hosted by the Council of Scientific and Industrial Research (CSIR) & National Chemical Laboratory (CSIR-NCL) and the Office of Principal Scientific Advisor (PSA).

AIM-PRIME program

AIM PRIME stands for Atal Innovation Mission Program for Researchers in Innovation, Market Readiness and Entrepreneurship.

The AIM PRIME program aimed to promote early-stage science-based, deep technology ideas to market through training and guidance over a period of 9 months. The AIM PRIME program was designed to nurture science-based innovations for society and the world. India’s role in fostering such innovations is expected to be important in the global context, and the AIM PRIME program sets the stage for that contribution.

The program was focused on promoting Science-based, Deep-Tech Entrepreneurship, anchored around a technical invention or novelty. The knowledge and science intensity is high in this kind of product/ service.

Consequently, the entrepreneurial journey emphasizes different aspects and requires a different approach to resourcing and navigating the de-risking process. The first year of AIM PRIME also aimed to explore and demonstrate India-appropriate methods and create helpful content on an open-access model available to all innovators and entrepreneurs.

The cohort comprised three key stakeholders – Startup founders, Faculty entrepreneurs with spinout company candidates (from academia), and Incubator managers from incubators supporting science-based startups.

The cohort had 40 organisations and 64 participants and representatives from 23 different cities across seven states. They represented science-based sectors like Industrial automation, IoT, electronics, robotics, energy and environment, health and rehabilitation, food, nutrition, and agriculture.

In the last nine months, the cohort has raised ~ ` 20 Cr, climbed 1-2 levels in both technology & commercialization readiness levels (TRL / CRL); received ~ 18-20 expressions of Interest from investors and 18 patents were filed. Six patents and two trademarks have been granted and they have received 25+ awards and recognitions.

The other critical components of the AIM-PRIME program were: AIM-PRIME Playbook, AIM-PRIME Library, and AIM-PRIME Youtube collection (share some screenshots). The PRIME Playbook is a guide for science-based entrepreneurs and ventures to progress from the lab to the market or from inventions to innovations.

It covers essential concepts along the journey and essential templates, links to other resources, and video lectures on those topics.

The AIM-PRIME Library is a curated resource shared by the faculty and expert mentors associated with the program. The PRIME Videos is a video collection of the lectures delivered as part of the PRIME Classroom. The entire collection is hosted for access to the public on Youtube.

The AIM-PRIME Playbook was physically launched on 10th May at the Dr. Ambedkar International Center in New Delhi in the presence of Chief Guest, Mr. Suman Bery Vice-Chair, NITI Aayog; Guest of Honor Dr. Bharati Pravin Pawar, Hon’ble Union Minister of State, Ministry of Health and Family Welfare (MoHFW); Dr. V.K. Paul, Member, NITI Aayog; Dr. Chintan Vaishnav, Mission Director, Atal Innovation Mission; Dr. Premnath, Managing Director of Venture Centre and Mr. Hari Menon, India Head, BMGF.

Shallow Tech

What’s the opposite of Deep-Tech, though this terminology is not used widely, the answer to the above question is “Shallow-Tech”.

One such example of “Shallow-Tech” is Uber/ Ola. Though these companies disrupted the taxi market ultimately, they don’t qualify as Deep-Tech as they leveraged an already existing technology/concept and built a platform around it.

A Deep-Tech firm would have to make the technology first, on which its physical product would work. For example: think of a Startup that manufactures a gun for spraying skin tissues on wounds for fast recovery or a startup that manufactures next-generation sodium-ion & lithium-sulfur batteries.

Such innovations emerging from deep-tech are radical and disruptive as they overcome the fundamental constraints and provide a significant improvement over the existing ways of solving the problem. Deep-Tech startups are in the minority, but their impact and reach are probably more significant than the run-of-the-mill startups.

Governments, universities, and startups all need to work together to propel the frontiers of science and translate technical capabilities into business applications. India is blessed with world-class engineering and science-based institutes and it would be a pity if we fail to convert the immense intellectual power of these institutes into machines for Deep-Tech solutions.

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By Anurag Wasnik

Anurag Wasnik, Innovation Lead, Atal Innovation Mission, NITI Aayog.

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