DeepTech sector has potential of over €9.3 trillion

Global venture capital and private equity investments in deep tech companies have increased from ten to 20 percent over the past decade, according to the recent report “How Europe’s Companies Can Win in the Deep Tech Century” by the Boston Consulting Group (BCG). To better understand the scale: the forecast EUR 9.3 trillion by 2030 corresponds to almost half of the expected GDP of all 27 EU countries. The economic potential is enormous, but the EU is lagging behind.

While US companies received a total of $220 billion for deep tech solutions between 2018 and 2023, in Europe the figure was only around $37 billion. This means that less than 10 percent of the global “deep tech unicorns” come from Europe, according to the BCG study.

How Europe can catch up

Europe does have a strong scientific base in the deep tech sector. Nine of the world’s 20 best research institutions are located in Europe. And the first seven places in the top 10 in the “Global Innovation Index” of the World Intellectual Property Organization (WIPO) are occupied by European countries. The only problem is when it comes to investments.

According to BCG, European companies can do two things to strengthen the DeepTech sector: strategic investments and the promotion of innovation ecosystems based on a clear strategy. This means, above all, providing financial support to startups in this area at an early stage. Because “a hesitant attitude towards collaborating with startups” has been identified as one of the main obstacles in the European DeepTech sector.

What is needed: DeepTech Amplifiers and technology transfer

What does this mean for competitiveness in the global market? Large companies are in demand as “deep tech amplifiers or shapers”. BCG sees them as responsible for turning deep tech innovations into transformative business models, as they achieve up to 10 times higher shareholder returns per patent than smaller companies.