VENTURE FINANCING OF DEEP TECH STARTUPS

DOI: 10.31673/2415-8089.2023.037785

Abstract

The article is devoted to researching the mechanisms of venture financing of deep tech (deep technologies) startups at each stage of the investment chain. Venture and private funds, limited partners, corporations, governments, and public institutions face the complexity of interacting with and understanding deep tech. Investments in the sector are growing, but deep tech startups often find it difficult to transition from grant funding to equity capital. Despite the increase in funding, businesses face the need for multiple rounds of grant funding to attract the attention of venture capital funds. The existing investment model limits deep tech enterprises aimed at solving significant global challenges. Problems include the difficulties of transition from the laboratory stage to commercialization, the uneven distribution of venture funding and the lack of state support for deep tech, which is a potentially important tool for solving the world's global problems.
Deep tech holds significant potential for scientific discoveries and technological breakthroughs, but investing in this sector remains a challenge. Despite the increasing volume of venture investments, deep tech startups have faced a number of challenges that limit their development and affect the entire investment ecosystem.
The problems of deep tech startups include the complicated transition from grant funding to venture capital and the uneven distribution of investments between different sectors and regions. This leads to the fact that many promising ideas and technologies are left out of attention and funding.
Despite record levels of "dry powder" venture capital, securing funding for deep tech remains problematic. Investors should rethink their approaches, ensuring a more efficient allocation of capital to ensure the development of a wide range of deep tech.
According to research, deep tech startups face rejection from general venture funds due to their high technical risks and long payback periods. In addition, limited partners and corporations may lack the skills and flexibility to successfully work with deep tech enterprises.
The diversity of investments by sector and region, as well as uneven access to capital, indicates the need for a balanced and innovation-oriented resource allocation strategy. Governments and public institutions play a key role in creating favorable conditions for deep tech startups through grants, research support and infrastructure creation.
It is necessary to create a favorable investment environment by enhancing collaboration between participants in the financial ecosystem and simplifying the process of attracting capital for deep tech startups.
In general, investing in deep tech requires rethinking the investment strategy, in-depth understanding of the sector and creating conditions for the growth of deep tech startups as a key tool for solving modern global challenges.

Key words: venture financing, deep tech, innovations, startups, investment funds.

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