Cambridge Consultants says barriers stifle deep tech

Cambridge Consultants has published research suggesting organisational barriers are holding back radical innovation in large companies. The study coincides with a strategic collaboration between Cambridge Consultants and XPRIZE.

The Deep Tech Index 2026 draws on a survey of 750 C-suite executives and 25 executive interviews. It found that 59% of CXOs see radical innovation as the most exciting form of innovation, yet only 15.7% said their organisations allocate 70% or more of innovation budgets to radical projects.

The findings point to a gap between enthusiasm for deep tech and the internal conditions needed to bring it to market. Respondents said promising ideas were more likely to lose momentum in approval processes, governance structures and competing corporate priorities than to fail for technical reasons.

Nearly two-thirds of those surveyed, or 63.47%, said employees hold back from taking risks because leaders do not visibly model risk-taking across their organisations. The report also identified short investment horizons, boardroom caution, traditional return-on-investment expectations and talent shortages as recurring barriers.

Budget divide

Spending patterns varied sharply by sector. Semiconductor companies stood out, with 36.4% of leaders saying their organisations devote at least 70% of innovation budgets to radical bets. Among consumer businesses, the figure fell to 2.8%.

Industrials and healthcare also showed a relatively stronger appetite for larger radical innovation budgets, while materials, communication services and energy lagged. No utility companies surveyed said they committed more than 70% of innovation spending to radical work.

The report suggests companies are changing how they assess innovation programmes. Interviewees said exploratory work without a clear commercial path is becoming harder to fund, as leaders push for projects tied more directly to profit-and-loss outcomes and earlier evidence of customer demand.

That trend has implications for deep tech ventures, which often require long development cycles and significant early investment before revenue becomes visible. The research argues that these conditions can make established companies less able to support breakthrough science and engineering, even when senior executives say they want to.

Many executives interviewed for the study said radical innovation had become both a defensive and offensive strategy. They linked that view to tougher customer expectations, geopolitical instability, stronger competition and shareholder pressure for double-digit growth.

XPRIZE link

Alongside the research, Cambridge Consultants has entered a strategic collaboration with XPRIZE. Under the arrangement, its scientists and engineers will help design, test and validate technologies across XPRIZE competitions, aiming to improve the route from ambitious concepts to scalable products and services.

The tie-up reflects a broader theme in the report around shared-risk partnerships. Executive interviewees said fee-for-service models are increasingly being replaced by co-investment structures, in which outside technology specialists and corporate partners share accountability for results and any eventual upside.

Richard Traherne, Chief Executive Officer of Cambridge Consultants, part of Capgemini, said the issue was less about scientific discovery than commercial execution inside large organisations.

"It's exciting to see that business leaders increasingly recognize the value of a deep tech strategy and what is really compelling is the acknowledgement that radical innovation can address real commercial need," Traherne said.

He added that the competitive gap was emerging elsewhere in the process.

"Crucially, though, organizations are not losing the global innovation race because competitors possess better ideas, but because competitors are superior at funding, protecting, and commercializing them. The gap isn't technical, it's structural," he said.

The research presents deep tech as an area drawing strong executive attention across fields such as artificial intelligence, robotics, biotechnology, quantum computing and next-generation energy. Its central conclusion, however, is that the main challenge for large companies is not generating breakthrough ideas but building funding models, leadership behaviour and decision-making systems that allow those ideas to survive long enough to become businesses.

Among the executives surveyed, 81% said defensible intellectual property is important for capturing long-term value for their businesses.