The government incubates innovation, but we need private investments to accelerate its transition from lab to market and community.
If you watched Christopher Nolan’s 2023 film Oppenheimer, you would have noticed the role of Matthew Modine, whose speech in defence of Oppenheimer during his security clearance hearing is one of the best moments in the film.
Modine portrayed the character of Vannevar Bush, Head of the U.S. Office of Scientific Research and Development during World War II, whose career also included being Dean of Engineering at MIT and founding a company that would grow into Raytheon. If you are passionate about science and technology innovations, policy and development, I recommend Vannevar Bush’s generation-defining letter to President Roosevelt called “Science: The Endless Frontier”. In his letter, which you can read here, Bush outlined a visionary approach to harness the power of science for national prosperity, public health, and security. He emphasised that the big problems of society and the world, such as poverty, unemployment, or healthcare, can be solved with scientific advancement, and the government must take the lead in supporting scientific research.
His thoughts defined America’s post-war science policy, led to the creation of the National Science Foundation (NSF), and, to a great extent, also influenced the creation of DARPA; both these institutions are today credited with much of America’s technological and military dominance.
To some extent*, Bush’s writings have influenced our thought processes throughout the evolution of our theory of change at Social Alpha. We believe in supporting innovators and fostering a broader support system where bold ideas are de-risked and turned into viable and sustainable businesses. Almost all innovations in our portfolio have benefited from government funding in some form or other.
Bush’s ideas catalysed the world in response to a difficult time dealing with the fallout of WWII. Today, we are in a similar situation; global challenges such as climate change, healthcare and extreme poverty require new knowledge and innovative solutions. These big problems demand that we take big risks to support innovation. The Indian government is already stepping up, with major funding through DST, DBT, and ministries, as well as initiatives like the National Research Foundation (INR 50K crore) and the draft National Deep Tech Startup Policy. Entrepreneurial support programs from NITI Aayog, BIRAC, NSTEDB, MEITY, and the government’s flagship initiative, Startup India, support innovation at every step.
The real question now is—how will the private sector respond? While corporations have their R&D priorities and budgets, who will fund some of the most complex challenges of Climate, Health and Livelihoods – in other words, how can we support more R&D for people and the planet?
At Social Alpha, we believe start-ups have a significant role in solving big problems and creating new markets, but they need more than government support. Impact-focused deep tech start-ups, especially those addressing climate change and healthcare issues, often work on breakthrough technologies such as energy storage, medical devices, and advanced materials.
These are tough problems, and the solutions require extensive R&D before deployment. The technology might not work as anticipated, or the product-market fit might take multiple iterations through pilots and validation studies.
While VC funding has been pivotal in the start-up ecosystem, its traditional playbook, which has a lower risk appetite and focuses more on business model innovation, services, or tech-enablement of services, doesn’t align with the unique needs of deep tech startups. These innovations often require access to non-dilutive capital such as grants, prize money, or government programs throughout their life cycle. This need for non-dilutive capital continues through the deployment and scale-up of market access support and subsidies.
This is an important nuance that capital providers need to understand. Philanthropy and corporate social responsibility (CSR) are powerful tools for de-risking innovations, preparing them for deployment and investment, and accelerating their lab-to-market journey. Some of our philanthropic and corporate partners play a significant role in this endeavour through their grants and CSR initiatives. If you’d like to be part of the public efforts to accelerate innovative social solutions, we invite you to join our family of partners who have entrusted us with their mandate and capital to maximise impact.
-Written by Manoj Kumar, Founder, Social Alpha
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*Additional readings
The Entrepreneurial State by Mariana Mazzucato
Boulevard of Broken Dreams by Josh Lerner