The universal challenges that all deep tech startups face

Having interviewed local actors from across the Baltic Sea Region, FINEST SCALEUP found that some of the challenges startups and scaleups face are universal regardless of industry.

1. Communication
   Deep tech startups base their operations on advanced technologies, which are often difficult for those outside the industry to understand. Communicating these complex innovations in a way that is accessible to investors, customers and partners poses a significant challenge.
2. Regulations and certifications
   Many startups face regulatory issues that are complex and not well adapted to rapidly evolving technologies. Deep tech startups require specific support in navigating these regulations, as their activities involve advanced technologies that are not always fully covered by existing legal frameworks. Another challenge is obtaining the necessary licenses, which often requires collaboration with various administrative bodies.
3. Access to talent
   Deep tech startups and scaleups face challenges in recruiting and retaining qualified employees, particularly in the face of competition from larger industrial companies. The lack of access to suitable human resources, especially for C-level and engineering positions, is a key challenge. This issue seems particularly significant in the Baltic countries, which are small in terms of both population and economic size.
4. Access to contacts
   Having access to mentors, investors and networks is crucial for the development of startups and scaleups, especially deep tech companies. Reaching the right people is essential not only at the beginning of the business journey to showcase solutions but also at later stages, such as international expansion, where understanding the specifics of different markets is key. For deep tech companies, the support of industry specialists is equally important, as they can help identify potential applications for developing technology.
5. Raising capital
   Public funding for startups and scaleups in the Baltic Sea Region plays a crucial role in developing the innovation ecosystem. However, it is important to recognise that when applying for funding, a startup must be able to clearly communicate its vision. Another issue is that some funding institutions do not provide 100% of the required support, meaning the company must secure the remaining funds on its own.
6. Managing expectations
   One of the biggest challenges that deep tech startups and scaleups face is effectively managing expectations, both within the team and in their relationships with investors and clients. It is crucial to understand what is expected from investors and what they expect in return from the startup. The same applies to employees, who need to be aware of the goals and challenges related to the project.