So Far, We Feed the Roots, but Others Reap the Harvest

Switzerland reigns as the world’s innovation champion. Yet Joanne Sieber, CEO of the Deep Tech Nation Switzerland Foundation, warns against complacency. In this interview, she explains why local startups often run out of steam during the decisive phase, why we urgently need to mobilise Swiss capital and why deep tech is far more vital for our future than the next taxi app.

Mrs Sieber, Switzerland is regarded worldwide as a mecca for innovation. Is this reputation deserved?

We are indeed global leaders in innovation; that is no fabrication. We have secured first place in the Global Innovation Index for the 15th consecutive time. However, innovation is not self-sustaining—it must be nurtured and cultivated. The foundation for this in our country is excellent: we possess universities of an absolutely top tier; ETH and EPFL rank among the top five educational institutions globally, including in terms of value creation. Added to this is a strong industrial anchor as well as an enormously high spin-out rate: in absolute figures, ETH Zurich is number three across Europe regarding spin-out value creation in the deep tech and life sciences sectors, directly behind the universities of Oxford and Cambridge. Furthermore, in Switzerland, we educate more STEM graduates per capita than any other country in Europe.

That sounds like an ideal scenario.

At first glance, certainly, but unfortunately, we also face a central problem in Switzerland: the path from the laboratory to a scalable business case is incredibly rocky. If you ask founders, almost all say the same thing: growth financing represents a significant stumbling block in this country. In the early phase, our ecosystem functions very well: there are venture capital funds, business angels, and sufficient state support, both at the cantonal and national levels. But the moment it moves into the scale-up phase, the air grows thin. Finding a Swiss lead investor for large rounds is nearly impossible.

Why do we struggle so acutely at this specific stage?

There are several reasons. A critical point is the lack of domestic growth capital. Our VC market is still young and not as advanced as, for example, in the USA. Swiss investors are often hesitant regarding the financing of large rounds. Additionally, due to the small domestic market, start-ups must expand globally very quickly, which immediately requires large sums of capital and courage. We are therefore facing a dual challenge: we urgently need funds that are prepared to invest 50 million and more to keep our companies in the country. The AWI Deep Tech Fund is an important step here to address this growth capital deficit. Furthermore, there are challenges such as the tax complexity of employee participation (ESOP) and restrictions on the immigration of international talent, particularly from third countries. However, a deep tech start-up needs exactly this specific expertise to compete globally.

And how do you intend to resolve this bottleneck?

We need a dedicated growth fund for this. We do not offer this ourselves but act as bridge-builders. Together with the Winterthur Investment Foundation (Anlagestiftung Winterthur), we established the AWI Deep Tech Fund. This will be launched in 2026 and will efficiently enable institutional investors to invest in the Swiss deep tech sector. This is a vital first step, essentially a blueprint that should serve as a model and be multiplied. In parallel, next year we are launching education programmes for institutional decision-makers, thereby ensuring greater transparency, knowledge, and data. We want to, and indeed must, provide proof that this asset class performs in order to build trust.

What are the specific implications for ownership structures?

The reality is that in the deep tech sector, over 85 per cent of the capital originates from abroad. That is not inherently wrong; we are dependent on foreign investors to reach the necessary capital volume. But from a Swiss perspective, the dynamic is risky: in this country, we invest tax money in education and research, with which we essentially nourish the roots of innovation. Yet the significant economic fruits—and with them the value creation, the exits, and the jobs of the future—are ultimately harvested by foreign investors. Regarding technological sovereignty, this is also problematic, because we run the risk of remaining dependent on foreign technology partners instead of cultivating our own robust deep tech basis “Made in Switzerland”.

The Deep Tech Nation Switzerland Foundation wants to act as a catalyst here. How do you plan to achieve this?

By working on the system, not in the system. We do not distribute grants to individual start-ups, but rather search for the structural gaps. It is unacceptable that we find no Swiss lead investors for the critical growth phase. Paradoxically, the money would certainly be available. Institutional investors such as pension funds or insurance companies possess the necessary means. In regulatory terms, pension funds would be permitted to invest up to five per cent of their assets in alternative investments like venture capital; in practice, however, the quota sits at under half a per cent. We therefore want to understand where the blockages are and resolve them.

Let us turn to the term Deep Tech. What distinguishes this sector?

Deep tech is the point where a scientific breakthrough becomes an economic breakthrough. Here we are speaking of AI, robotics, life sciences, quantum computing, or new energy solutions. Our Foundation Board member Catrin Hinkel, CEO of Microsoft Switzerland, put it aptly: deep tech is the new foundational technology—comparable to the significance of the railway in the 19th century.

So it is about more than just the next convenient lifestyle app?

Actually, it is about much more. Uber is a prime example of this: the application has made taxi services more convenient and fairer worldwide. We designate this as “Low Tech”, which indeed increases our comfort, but neither slows down climate change nor cures cancer nor contributes to the protection of national security. Deep tech, on the other hand, addresses exactly these major, socially relevant topics: health, energy supply, defence. What will be relevant in the future, therefore, takes place in this arena.

In January, you are additionally launching “Project Switzerland“. What does this entail?

This is a new, nationally supported initiative with the guiding question: how do we write the next global tech success stories? It does not necessarily have to involve exclusively deep tech cases. We bring established entrepreneurs who have already achieved their breakthrough together with the next generation of founders who are just entering the critical growth phase—meaning firms that already possess over two to ten million in annually recurring revenue. The idea is simple: the experienced generation shares their knowledge regarding internationalisation, exits, and growth in curated peer groups and confidential formats.

What long-term goal have you set for the Deep Tech Nation Switzerland Foundation?

Our ambition is clear: we want to double the invested venture capital in Switzerland by 2033—from today’s roughly 2.5 to 3 billion francs to at least 5 billion. We can no longer rest—it is time for Switzerland not only to water the roots but finally to bring in the harvest as well.