Growing Britain’s Deep Tech Future: Lessons from University of Warwick.
Britain is brilliant at starting deep tech companies and worryingly weak at growing them. The fix begins long before a Series A, in the months when a founder is still deciding whether they have a business at all.
By Professor Andy Pardoe, Chair, Deep Tech Innovation Centre, University of Warwick.
There is a story the United Kingdom likes to tell about itself, and for once it is mostly true. We are a nation of inventors. Our universities produce world-leading research, our engineers solve problems that matter, and our founders are bold enough to build companies on the back of genuinely hard science. The numbers bear this out. In 2025 the UK attracted nearly six billion dollars of deep tech venture investment, ranking third in the world behind only the United States and China, and the country has now produced more than fifty companies worth a billion dollars or more in valuation or revenue.
And yet the same year produced a more uncomfortable figure. UK domestic investor participation in deep tech falls from well over half at seed stage to under a tenth at the late stage. The Royal Academy of Engineering puts the annual late-stage funding gap somewhere between four and eleven billion dollars. Put plainly, we are excellent at the beginning of the journey and we lose our nerve, or our capital, somewhere in the middle. Three in four UK tech founders now name access to growth capital as their single biggest obstacle, and a striking share are quietly considering whether they would be better off headquartered in the United States.
| We are a nation that funds the spark and then struggles to feed the fire.
It would be easy to read that as a problem for the later stages, a question of pension reform and growth funds and policy levers that sit far above the heads of most founders. Some of it is. But I want to make a different argument, one drawn from running an incubator for early-stage deep tech founders rather than from a spreadsheet. The quality of what happens at the very beginning, in the months before a company has revenue or a round or sometimes even a registered entity, shapes everything that follows. If we want more British deep tech companies to survive the scaling valley, we have to build them properly from the first day. That work starts earlier than most people think.
Deep tech breaks the standard startup playbook
Most startup advice is written for software companies, and most software companies can be wrong cheaply. You ship a product, you watch what users do, you change it next week. The cost of being wrong is a sprint. Deep tech does not work like this. When your company is built on a novel application of artificial intelligence, a new approach to data, a piece of hardware, or a scientific result that has never left a lab, the cost of being wrong is measured in months and sometimes years.
This single fact reshapes everything. A deep tech founder faces what people in the field politely call the lab-to-market problem: the long, expensive, leadership-intensive passage from a thing that works in principle to a thing that solves a real problem for a real customer at a price they will pay. The technology being extraordinary is not the hard part. The hard part is that being extraordinary is not, by itself, a business. I have watched genuinely brilliant ideas stall, not because the science failed but because the founder never got the early help they needed to turn an invention into a company.
The founders who struggle are rarely short of intelligence. What they lack, at the outset, is a set of unglamorous things: a clear sense of who the customer actually is, evidence that the customer feels the pain acutely enough to pay, a route to market that does not assume infinite patience, and the commercial vocabulary to explain all of this to an investor who will spend ninety seconds deciding whether to read the second page. These are learnable. But they are learned fastest in the company of people who have done it before, and worst in isolation.
| The technology being extraordinary is not the hard part. The hard part is that extraordinary is not, by itself, a business.
The regional dimension we keep ignoring
There is a second pattern worth naming. UK venture capital remains heavily concentrated in London, which accounts for close to half of all deals and the majority of investment value. The capital is in the capital. Meanwhile the research that deep tech is built on is spread across the country, in university clusters that punch far above their weight. Academic spinouts attracted billions in equity investment last year, and regions anchored by strong universities are increasingly where the most interesting deep tech is being created.
The danger is obvious. If the ideas are born in the regions but the money lives in London, founders face a choice between relocating early, before they are ready, or trying to build investor confidence at a distance, which takes time and consistency and a track record that a single founder cannot manufacture alone. The answer is not to move everyone to London. It is to build genuine innovation ecosystems where the research already is, so that founders have a reason to stay and grow where they started. That is a deliberate act of construction, and it is precisely the work that a university-anchored incubator exists to do.
What early-stage founders actually need
After several years and several cohorts of running the Deep Tech Innovation Centre at the University of Warwick, I have become fairly opinionated about what genuinely helps a founder in their first year and what merely looks like help. Four things matter more than the rest.
Validation before building. The most valuable thing we do is also the least dramatic. We help founders test whether the problem they have fallen in love with is a problem anyone will pay to solve, and we do it before they have sunk a year into building the wrong thing. Our training programme is built on the model behind the highly successful ICURe approach, which sends founders out to talk to the market early and lets the evidence, rather than the founder’s hopes, shape the business. For deep tech, where building is so expensive, getting this right is the difference between a company and an expensive hobby.
Mentoring from people who have done it. A founder can read every book on the market and still not know what to do on a Tuesday when a pilot customer goes quiet and the cash is tight. One-to-one mentoring from experienced entrepreneurs, the kind who have made the mistakes already, compresses years of painful learning into a few honest conversations. The point of a mentor is not encouragement. It is judgement, applied to your specific situation, by someone with no incentive to flatter you.
A cohort, in the same room. We run our programme in person, deliberately. There is a particular kind of resilience that comes from sitting alongside other founders who are at a similar stage but solving entirely different problems in entirely different markets. They challenge your assumptions in ways a mentor cannot, because they are in the trenches at the same time. As one of our founders put it, you can never have too many inputs, and the market is dynamic enough that you have to be too. The friendships and the honesty that form in a cohort outlast the programme.
A path to becoming investment-ready. Given everything I said earlier about the funding landscape, this is not optional. The goal of the early months is not to raise money for its own sake but to build a company that deserves to be funded and can explain why, clearly, to the right people. That means access to networks of investors and the discipline of a business plan that survives contact with a sceptic. Becoming investment-ready is a craft, and it can be taught.
The case for getting in early.
Everything above points to the same conclusion. The late-stage funding gap is real and serious, but it is not the only place the system leaks. A great many companies never reach the late stage at all, not because the capital was missing but because they were never built in a way that could carry the weight of growth. The foundations were poured in a hurry, or alone, or on the wrong site. Strengthening the earliest stage is the highest-leverage intervention we have, because everything compounds from there.
This is why the work of an early-stage incubator is not a nice-to-have at the soft end of the innovation economy. It is structural. When we help a founder validate an idea properly, find the right first customer, sharpen their story and meet the right investor, we are not just helping one company. We are widening the mouth of the pipeline that the entire country depends on to produce the scale-ups and the eventual giants. The return on getting this right is enormous, and it accrues to the region and the nation, not only to the founder.
| Strengthening the earliest stage is the highest-leverage intervention we have, because everything compounds from there.
Building the next cohort at Warwick.
At the Deep Tech Innovation Centre, part of the Warwick Innovation District, this is the whole of our purpose: to inspire, educate and incubate the next generation of innovation founders. We are focused on three streams, AI and Data, FinTech and new for this year Cyber Security, for founders building sustainable businesses on data science, artificial intelligence and emerging technologies. We work with people at every stage of the journey, from a researcher with a result and no company to a founder with early traction and a hunger to grow.
The programme is free, it is part-time enough to fit around the rest of a founder’s life, and it is open to anyone in the UK, whether or not you have any previous connection to the University of Warwick. Members receive bootcamp training and monthly workshops on the topics that matter to early-stage founders, one-to-one mentoring, online drop-in clinics, access to our networks of businesses, mentors and investors, and dedicated space at the heart of the Warwick campus to work, meet and get to know the rest of the cohort. What you build with it is up to you. We have seen founders use it to write a business plan, launch a prototype, find their first investors, and in several cases build companies that have gone on to hire the very students who first met them here.
If you have an idea built on hard technology and the conviction to pursue it, the worst thing you can do is to build it alone and in the dark. The best deep tech companies are not the ones with the cleverest science. They are the ones that learned, early and in good company, how to turn that science into something the world will actually use.
Applications are open for our next cohort.
If you need support, space, experts, mentors, or help starting up or growing your business, apply today.
Professor Andy Pardoe is Chair of the Deep Tech Innovation Centre at the University of Warwick.
