So What Exactly is 'Deep Technology'?

 We founded Propel(x) just over a year ago to help deep technology startups find the essential angel funding they needed. From our work running the MIT Angel Investor group, we knew there were several underserved areas in technology overlooked by investors searching for the next 'unicorn'. What investors may not realize is the potential for deep technology companies to dominate the future in many ways.

There are countless technology disciplines and startups comprising the “high-tech” world, but we needed a way to categorize startups in the life sciences, energy, clean technology, computer sciences, materials, and chemicals sectors. After many hours of debate among ourselves and others, we decided to use the term “deep technology” to build a new category of technology startups.

We define deep technology as companies founded on a scientific discovery or meaningful engineering innovation. This is where you’re asking, “Aren’t all technology companies founded on these principles?” Partly yes, but mostly no. Most technology companies these days are built on business model innovation or offline to online business model transition using existing technology. Take Uber for example – Uber is built on the concept of a “sharing economy” – a business model innovation enabling individuals to share existing resources.

Deep technology companies on the other hand, are built on tangible scientific discoveries or engineering innovations. They are trying to solve big issues that really affect the world around them. For example, a new medical device or technique fighting cancer, data analytics to help farmers grow more food, or a clean energy solution trying to lessen the human impact on climate change. Continuing the Uber reference, deep-technology companies in the transportation business would include autonomous vehicles, flying cars or other similar transformative technologies.

What we have come to realize is the fields in deep technology often struggle to find initial funding because of their complex nature.

Why Does Deep Technology Matter?

We strive to help companies we think will make a real difference in the life sciences, energy, clean technology, computer sciences, materials and chemicals fields. This is an exciting time as technological and scientific advances are transforming the world around us at a staggering pace.

 For example, while the scientific community has been studying the human genome for years, genomics – which combines DNA sequencing methods and bioinformatics – is quickly emerging as a new and exciting field for research and new startups are emerging at a rapid pace from leading research centers. The University of Virginia even opened a high-tech genomics lab to further the field. A recent report from The National Venture Capital Association said life science investments in 2014 rose to the highest level since 2008, with $8.6 billion invested into 789 deals, which was a 29 percent increase in dollars compared 2013.

Although artificial intelligence has been chased for decades, one approach – deep learning – is now being applied with great results to complex problems including speech recognition, natural language processing, visual recognition and other complex activities. 

 Interestingly, these companies have been limited as deal flow only to a handful of connected people. And, importantly, the value of these companies is apparent to an even smaller number of people. Google made waves when it bought a somewhat low profile company called DeepMind for over $400M last year. The company had been funded by a small number of visionaries earlier (Founders Fund, Elon Musk). Others either did not have access to this deal or didn’t have the ability to perform adequate diligence to make the judgment to invest.

The goal of Propel(x) is to bring this deal flow more broadly to all accredited investors and to leverage the power of experts to understand the value of these companies. We want these companies to encounter less friction raising money. And we want investors to benefit from investing in these early on.

Deep technology startups have the ability to disrupt several markets to create incredible economic value for early investors and a lasting effect on mankind in positive and meaningful ways.

Bringing Life to Deep Technology Startups

Propel(x) was built as a way for this underserved and important start-up community to find the investors they need to succeed, while allowing investors to discover deep technology startups they couldn’t find on any other platform. Deep technology companies are creating new opportunities for several markets, and engaging investors to think about new startups that they may have never encountered before. These are not Internet companies; nor are they based on business model innovations. Deep technology companies are based on scientific discoveries or engineering innovations – these are transformative companies that will change the face of the planet in coming decades. Investors with vision can create value for the world and have the potential for incredible returns for themselves by investing early in these companies. I invite you to fulfill this shared vision with us at Propel(x).