An article recently published online with the title “Europe needs more scientists in VC to become a deeptech powerhouse – Tech.eu” highlights the fact that the problem deep-tech startups are facing is still not widely understood. A good understanding of the problem a deep-tech startup addresses with its technology can be mediated by a better process within the startup (a significant part of our—TD Shepherd—work is to “format” a startup’s focus into a story the outside world can understand, connect with and “own”). Therefore, the real problem is not solved by bringing more scientists into the VC teams—they would quickly lose their skills and signify a loss to the engineering community. What the deep-tech startups do need are venture funds with a significantly longer lifetime and deeper pockets – it is as simple as that. The availability of sufficient venture capital over the lifetime of a deep-tech startup (for instance, a fabless semicon startup will, on average, exit after ten years and a total investment of € 50-60M). While the availability of seed/early-stage capital is becoming easier (although the amounts remain (significantly) lower as compared to the USA), the later-stage rounds are increasingly difficult for EU-based deep-tech startups. That is where the real problem is located, not the lack of scientists in the VC community.
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Imagine you’re building a robot. Not just any robot. Your robot. It’s smart, shiny, and meant to change the world. But before you bring it to life, you face a serious question: “Do I buy the robot factory, or just rent a workshop?” That’s where the magical world of CapEx and OpEx begins.
When you’re building a startup, the kind of funding you choose can determine the path your company takes. Two common funding options usually come into play: Venture Capital (VC) and Corporate Venture Capital (CVC).
TD Shepherd congratulates the Innoseis Sensor Technologies’ team on closing of their Seed round led by FORWARD.one. Innoseis ST is a spin-off from the Nikhef who transferring advanced research in gravitational-wave detection into commercial sensor technology.