The term deep tech is used to describe a company – quite often a start-up business – whose business model centres around high tech innovations in engineering or substantial scientific advances. Alternative terms for deep tech include ‘hard tech’ and ‘deep technology’.
As part of Business Leader Tech Month, we’ve taken a closer look at the deep tech industry and its technologies to give you a unique insight.
What is considered deep tech?
There are a wide range of technologies classified as deep tech. These include artificial intelligence (AI), robotics, blockchain, advanced material science, photonics, electronics, biotech, and quantum computing.
How much is the deep tech industry worth in the UK?
In recent years, the UK has invested huge sums into deep tech technologies, so much so that in 2019, the 2019 Technology Innovation Hubs report from KPMG placed us at number 3 globally, behind the US (number 1) and China (number 2), for countries producing technology breakthroughs with a global impact.
Between 2015-2020, venture capitalists also invested £11.2 billion into UK deep tech. This is more than double that of our nearest European competitor, Germany, who saw £4.8 billion of investment.
The UK tech scene also employs 2 million people and contributes more than £130 billion to the economy. According to 2019 reports, the tech scene was our fastest growing sector, experiencing a 10% growth rate year on year too. So, if deep tech investment continues to rise during 2021, we could see the industry become even more important to our post-Brexit economy.
How many unicorn companies are there in the UK tech industry?
The UK is home to many of the world’s leading tech companies; according to the Tech Nation Report 2019, the UK produced 13 unicorn companies in the tech sector in 2019. A unicorn company is a private startup with a valuation of more than $1 billion. This took our total to 72 tech unicorn companies, which means we have more than any other country, the US and China aside.
Who are the biggest deep tech companies in the UK?
Some of the UK’s biggest deep tech companies might be familiar to you already and others not so much. We have listed 5 of them below and their estimated worth:
Darktrace is a Cyber AI defence platform used by the NHS, BT, Metrobank and other high-profile clients. It has as estimated worth of $1.7 billion (£1.24 billion).
With an estimated worth of $1.3 billion (£954 million), Blueprism is one of the biggest names in deep tech. Blueprism uses robotic process automation (RPA) to create a digital workforce that carries out a wide range of business process, saving clients from a huge number of industries on processing costs.
- Babylon Health
Babylon Health’s mission is simple: to put an accessible and affordable health service in the hands of every person on earth. It does this via an AI-powered chatbot that uses algorithms and deep learning to answer medical questions through existing technologies. Babylon Health is worth more than $2 billion (£1.48 billion).
Roborace is one of the most exciting deep tech companies in the UK today. Founded in 2015, it is a competition for electric, self-driving cars. Competitors must develop their own real-time computing algorithms and AI technology to gain an advantage and win races. The company managed to raise £72.7m in funding in 2020.
Graphcore invented the Intelligence Processing Unit (IPU), a processor designed to accelerate AI intelligence and reduce their costs. With a value of $1.7 billion, these innovative chips are having a huge impact on AI intelligence and deep tech technologies.
Is IoT deep tech?
IoT is short for Internet of things, which is a term to describe a network of physical objects (things) that connect to the internet and exchange data over it. IoT is a form of deep tech, and one that has undergone considerable expansion and innovation in recent years.
Everything from smart toasters and watches to rectal thermometers and motion sensors fall into this category. However, as these devices collect data on the users, Samsung reported in 2016 that it was essential that the 7.3 billion devices that make up the Internet of Things needed to be secured by 2020. So, in addition to additional devices, 2021 could be a year where we also see innovations in device security.
What does 2021 look like for the deep tech industry?
The European deep tech industry now has a combined value of a whopping £623 billion. With the ongoing battle with coronavirus continuing to accelerate the shift to a more digital world, there is a great opportunity for deep tech companies to create even more innovative technologies and build upon existing ones too.
Increasing health consciousness has been another knock-on consequence of COVID-19. Therefore, we could see new companies taking on Babylon Health and the other big names in health-focused deep tech.
However, the industry has not been without COVID casualties. Roborace, for example, was severely impacted by the virus initially before stabilising towards the latter half of 2020. Many lesser established companies were not quite as lucky, though.
So, whilst 2021 looks like another year where innovations in the deep tech world could excel, it will be interesting to see the extent of which COVID hampers digital innovation.