Don’t have time to read? Watch the video instead.
Last week I launched Season 3 of my podcast Deep Pockets. This season is themed as a book club, each week I bring a new nonfiction author who writes in the intersection of government and innovation.
Dan Roche’s book ‘The Total Beginner's Handbook for Doing Business with the Government - A Plain Language, Easy-to-Understand, and Mildly Entertaining Guide to a Complicated and Often Misunderstood Business’ delivers exactly what the title promises.
Find this podcast episode here.
For emerging technologies a government agency is often the first paying customer. So, if you are developing a groundbreaking new technology, how to find the right agency, how to approach them, how to negotiate, deliver, and charge for your work.
I don’t know if it’s just my personal growth from the startup world into deeptech, but I have a feeling that the Silicon Valley VC investment model is beginning to be outdated (sorry SV friends). I can see so many other funding models that are faster and easier to get and don’t require so much pitching effort. Small business loans, grants, open calls, corporate investors, public-private partnerships, these are all ways for a startup or a spinoff to create first iterations of their product, and discover R&D partners at the same time.
For example, if you join one of the National Science Foundation’s many programs or projects, you are joining a group of people working to solve similar problems that you are trying to solve. Not only are you potentially receiving a grant from NSF, but you can split work with a fellow entrepreneur and safe in R&D hours. Similarly, joining Amazon, Google, or Microsoft startup programs can bring similar advantages.
As Dan Roche says in my podcast, like any investor the government agencies want to avoid risk. This is especially true in emerging technologies when there is no clear private industry yet (think of quantum now, or space tech 10-20 years ago). One way to mitigate the risk is to source technologies from a wider group of small providers.
This has opened up government as a viable source of funds for early stage emerging technology companies. Just think of CHIPS and Science Act together with the Inflation Reduction Act, together for 2024 they include
“$209.7 billion for Federal R&D, a $8.9 billion increase over the 2023 enacted level, including approximately $18 billion for R&D in key agencies in the CHIPS Act (the Department of Energy (DOE), the National Science Foundation (NSF), and the Department of Commerce’s National Institute Standards and Technology).”1
This money is already flowing into states to fund science and innovation. One great example of this is my former home state Colorado, who secured an EDA funded Regional Technology and Innovation Hub, a TechHub, for developing quantum technologies in the state. The local consortium, Elevate Quantum includes over 70 local startups, research labs and scientific institutions.
EU’s main public R&D funding program, Horizon Europe is a public-private partnership fund with a budget of $105 billion (95.5 billion euros). It is only this kind of money that can fund deep science, deeptech, emerging technologies. (which, by the way is the reason why I named my podcast Deep Pockets).
Go out and find these programs. Don’t waste years standing in line for VC pitching competitions only to be rejected again and again. And then, if you’re lucky, you get a VC investment and are controlled by a handful of investors who never worked in your field, don’t have relevant customer contacts and lack the patience that the deep pockets offer.
https://www.whitehouse.gov/wp-content/uploads/2023/03/ap_6_research_fy2024.pdf