10 May, 2022
European investment in and development of fundamental technologies is lagging behind competitors in the US and Asia.
The problem is that European investment in and development of fundamental technologies is lagging behind competitors in the US and Asia in cross-sector technologies like quantum computing, digital infrastructure and next-gen materials.
Europe is facing a slow-motion corporate and technology crisis, according to a McKinsey report published last week.
The problem is that European investment in and development of fundamental technologies is lagging behind competitors in the US and Asia in cross-sector technologies like quantum computing, digital infrastructure and next-gen materials. The four challenges they see is depicted in the figure. One of the key initiatives of CVN is connecting ecosystems which is identified as one of the key problem areas.
Sifted anayzed this as: Europe doesn’t have a deeptech startup problem, it has a deeptech scaling problem
They came to this conclusion based on an analysis by three members of the European Innovation Council’s (EIC) ScalingUp initiative, after their survey of founders and investors. The EIC is the European Commission’s flagship €10bn vehicle for financially supporting innovation — including startups — in Europe. Unfortunately, that might not be enough. The ScalingUp initiative is one of the EIC’s programmes specifically looking to back deeptech companies. So far, it’s put money into 37 entrepreneurs that have previously received EIC funding, and aims to help them scale beyond their Series B. It’s run by Boston Consulting Group (BCG), TechTour, Bpifrance and Deepwave Ventures.
Problems identified are:
The technical-oriented founders of the selected deeptech companies often come from scientific backgrounds and “obsess about technology”, which leads to some complex pitches.
The overall level of the quality of boards in Europe is much lower compared to the US
The so called “White Knight Syndrome”, which basically means that every potential investor is looking to another investor to lead a round leading to a lack of lead investors
Corporates are too slow and hesitant, whereas deeptech sales are overwhelmingly B2B, and in B2B the biggest clients are corporates
CVN has launched several experiments to improve the corporate startup interactions promoting more and better positive outcomes.