Karolina Urbonaitė, Head of Startup Lithuania at Innovation Agency Lithuania

Startups are often associated with rapid success stories – an innovative product or service attracts investors and fuels fast growth. But deep tech follows a different trajectory, where it can take ten years or more for a technological concept to achieve commercial success. Despite this longer path to market, the sector’s potential is growing rapidly: over the past five years, the combined value of Lithuania’s deep tech startups has grown 3.1x to €2 billion, while today nearly every second euro invested in Baltic startups goes to deep tech.

Baltic deep tech is surging

While much of the public attention tends to focus on existing or potential unicorns with proven business models, Lithuania’s deep tech ecosystem is quietly laying the groundwork for potential breakthroughs in medicine, energy, robotics, space and defence.

According to the latest Baltic Deep Tech Report, the combined value of Lithuania’s deep tech startups has increased 3.1x over the past five years, reaching €2 billion last year. Under a broader definition of a deep tech startup, their total value in Lithuania would exceed €3.1 billion. The report also shows that Lithuania was home to 275 deep tech startups last year.

These figures reflect the rapid growth of the Baltic deep tech ecosystem as a whole. Between 2021 and 2025, the Baltics outpaced all other European regions and the US in deep tech startup value growth. Today, nearly every second euro invested in Baltic startups goes to deep tech. This represents enormous potential and an opportunity to create significant long-term economic and societal value. Unlocking it, however, requires both investors and policymakers to recognise and respond to the specific challenges of the deep tech ecosystem.

Not a sprint, but a long-distance race

The main challenge for deep tech startups is their longer product development and commercialisation cycle. Unlike many conventional technology startups, where an initial product can be developed and tested in the market relatively quickly, deep tech companies need to conduct scientific research, develop technological prototypes, test them in real-world conditions and obtain the necessary certifications or regulatory approvals.

For example, an initial version of a consumer app might be developed within a month, with a prototype created in just a few days. Deep tech solutions, by contrast, often take many years to reach the market. Developing a functioning technology is not enough – companies must also demonstrate its practical application, safety and compliance with sector-specific requirements.

A good example is Lithuanian medical technology startup BrachyDOSE, which is developing a solution designed to improve the accuracy of cancer treatment. Its technology enables real-time measurement of the radiotherapy dose delivered to a patient, helping reduce the risk of treatment complications. Before reaching the market, however, the technology must still undergo certification processes and be successfully integrated into hospital systems.

Deep tech companies also differ from conventional startups in terms of their customers. Instead of individual consumers, they often sell to hospitals, large corporations, government institutions or defence organisations. This means longer sales cycles and more complex decision-making processes.

Legislative change opens up new opportunities

Because of these characteristics, deep tech startups generally have greater financing needs. This makes not only private capital but also public funding instruments – including grants, publicly supported research programmes and other forms of early-stage support – particularly important.

In 2025, Lithuania took an important step towards recognising these specific characteristics. The period during which micro and small enterprises engaged in R&D activities can qualify for startup status was extended from five to ten years. This allows companies developing technologies over longer timeframes to retain access to startup-specific opportunities before they reach the market.

This is a significant change. Previously, many deep tech companies simply could not reach the market within five years and, as a result, lost access to some of the support available to startups, including acceleration programmes, financing instruments and other ecosystem initiatives.

Deep tech development is a strategic national interest

Supporting the growth of the deep tech ecosystem is clearly in Lithuania’s strategic interest. These startups develop high-value-added solutions and address strategic and global challenges. The importance of investing in defence innovation, for example, is evident, as is the value of developing health technologies that can help prevent diseases or improve their treatment.

Deep tech solutions are also more difficult to replicate. As a result, startups in this field not only deliver practical benefits but also strengthen national competitiveness, create highly skilled jobs and contribute to economic growth.

To fully realise this potential, Lithuania must continue strengthening cooperation between science and business. This requires mechanisms that help turn scientific ideas into viable companies – encouraging universities, research centres and innovative businesses to work together, while also developing specialised programmes and strengthening technology commercialisation capabilities.

Access to the infrastructure required for innovation is equally important for deep tech startups, including laboratories, testing facilities and international partners. Talent is another crucial factor – particularly people who are able to combine technological expertise with the skills required to build and grow a business.

Local investors are turning to deep tech

Capital – and investors who understand the specific nature of deep tech – is undoubtedly one of the key drivers of the sector’s development. Encouragingly, the number of such investors in Lithuania is growing.

For example, BSV Ventures specialises in early-stage deep tech, life sciences and dual-use technology companies. Scalewolf, meanwhile, focuses on dual-use technologies and invests in startups working across defence technology, artificial intelligence, autonomous systems, energy and data technologies.

Notably, local and European investors accounted for as much as 84% of deep tech funding in the Baltics last year. This suggests that regional funds are becoming increasingly forward-looking and more willing to invest in foundational technologies that may take years to mature.

Lithuania has all the key ingredients needed for a thriving deep tech ecosystem: a strong institutional and research base, world-class talent, established expertise in areas such as biotechnology, lasers and photonics, and a rapidly growing focus on defence innovation.

The priority now is to ensure that these elements interact effectively and reinforce one another, while providing innovators with the institutional support they need. After all, it is within deep tech startups that potentially world-changing innovations are being developed – and where the foundations of a high-value-added economy are being built.