Embracing impact is the smart investment play

Inspired by Alex L Frederick’s LinkedIn post on agtech funding dynamics.

We’re living through what might be called a “meaning gap” in entrepreneurship and investing. On one side, there’s an abundance of capital chasing products that optimize the already-optimized lives of affluent consumers. On the other, technologies that could genuinely transform lives—curing diseases, producing carbon-neutral solutions, improving conditions for billions, while enhancing national security and resilience—struggle to find consistent funding.

The numbers are jarring: ŌURA raised $900 million at an $11 billion valuation. Meanwhile the entire agtech sector scraped together $1.3 billion in Q3 of 2025. One company making smart rings is worth more than seven times what an entire sector addressing a $9 trillion global food market raised in a quarter.

ŌURA figured something out: they deliver dopamine daily. Every morning, you wake up to a sleep score, a readiness metric, recovery data. The behavior change happens in hours. Agricultural biotech? You’re asking investors to wait until harvest to see if something worked. Clean energy solutions? Years of R&D before commercialization. Disease research? Decades, potentially.

The traditional venture capital landscape has increasingly shifted toward safer, less risky investments focused on convenience rather than addressing humanity’s most critical challenges. We’ve optimized for quick wins over lasting impact.

A recent New York Times analysis captured this divide at the macro level: while the U.S. economy appears resilient, that strength now rests largely on the top 10 % of households, who account for nearly half of all consumer spending. Lower- and middle-income families, squeezed by inflation and a cooling labor market, are pulling back.

The same concentration shaping our consumer economy also shapes venture capital flows. Billions chase technologies that enhance affluent lifestyles, while innovations that could expand resilience for the rest of the economy—food systems, climate adaptation, equitable health access—struggle for oxygen. What looks like prosperity on paper often conceals fragility underneath. The same is true in innovation finance.

The Narrative Challenge

Part of this funding disparity isn’t just about investor appetite—it’s about how founders tell their stories. As Paul O’Brien, who runs incubators globally, points out in his comment on the original LinkedIn post: ŌURA doesn’t pitch “a $900M ring”—they position themselves as “reinventing the infrastructure of healthcare.” They’ve mastered the art of speaking to what the market wants rather than what the product does.

This matters. A founder saying “autonomous inspections for large farms” isn’t compelling to most investors. But “making the food supply safer and more transparent from farm to table”? That connects to something people care about.

O’Brien’s critique has merit: deep-tech founders sometimes lead with the solution rather than the problem. They speak in technical specifications when they should speak in human outcomes.

But here’s where the critique falls short: It assumes the playing field is level—that all deep tech needs is better storytelling. The reality is more complex.

ŌURA benefits from selling something that feels personal and immediate. Sleep affects you tonight. Your readiness score changes tomorrow. The feedback loop is instant and emotional. Agricultural biotech, even when brilliantly positioned, asks people to care about problems that feel distant and systematic: supply chain resilience, food security for billions, climate adaptation at scale.

This isn’t about founders failing to “work it out.” It’s about the fundamental psychology of how humans engage with problems. We’re wired to respond to immediate, personal concerns over abstract, systemic ones—even when the systemic ones pose existential risks.

Here’s the reality: investors gravitate toward problems that are emotionally proximate and financially quick, regardless of how well you frame the alternative.

This is precisely why patient capital matters. Deep-tech founders shouldn’t have to pitch their work as consumer-facing dopamine delivery systems to deserve funding. The impact is real—it just operates on different timelines and scales. The challenge isn’t getting founders to “speak the market’s language” better. It’s building capital structures that value solving hard, distant problems as much as they value optimizing convenient, immediate ones.

Two Paths, Not One Wrong Answer

Some investors will always prefer the Italian-leather-couch strategy: find what affluent people want, sell it to them, make money, repeat. That’s a perfectly valid approach. But others are discovering something more satisfying: you can make money and make a difference.

Research backs this up. According to the book Firms of Endearment by Raj Sisodia and colleagues, which tracked 18 purpose-driven companies over 10 years, these companies outperformed the S&P 500 by 10 times and outperformed Good to Great companies by 6 times. More recent research from Jump Associates found that over a 20-year period, purpose-driven companies achieved returns five times higher than S&P 500 averages. Additionally, Deloitte research shows that purpose-led companies experience 30% higher levels of innovation and 40% higher employee retention. Companies with authentic purpose don’t just feel good—they perform better.

If purpose-driven companies outperform because they integrate meaning into business design, deep-tech ventures represent where that meaning scales. Deep tech operationalizes purpose in the most literal sense—solving problems that matter. It’s not just about “doing good”; it’s about creating the kind of innovation that makes long-term performance inevitable.

What Deep Impact Actually Looks Like

“Deep tech” isn’t just a funding category—it represents a fundamentally different approach to innovation. Deep technology companies address substantial scientific or engineering challenges requiring lengthy research, large capital investment, and strong intellectual property protection. They have the potential to create new markets or disrupt existing ones while solving major societal challenges.

This includes companies working on:

• Agricultural innovations that could genuinely address food security for billions

• Medical breakthroughs that cure rather than merely manage diseases

• Clean energy solutions that make carbon neutrality economically viable

• Water purification technologies that provide access to clean water globally

• Materials science that eliminates waste and enables circularity

• Robotics and automation that solve complex physical-world problems

• Semiconductor technology that enables next-generation computing and connectivity

These aren’t hypothetical benefits—they’re measurable impacts on human welfare, environmental health, energy efficiency, and long-term sustainability.

The Due Diligence Imperative

The same skepticism consumers apply to wellness brands should apply to impact investing. Not all “impact” technologies deliver meaningful outcomes, and patient capital doesn’t mean patient due diligence.

Deep-tech investors must rigorously assess:

• Technical feasibility: Can the science actually work at scale?

• Market timing: Is the world ready for this solution, or is it 10 years too early?

• Actual impact metrics: Lives improved, carbon reduced, yields increased—not just papers published

• Founder capability: Do they have the technical chops and business acumen to navigate the 7–10-year journey?

Authenticity in deep tech isn’t about marketing—it’s about honest assessment of technical risk, realistic timelines, and transparent communication about both progress and setbacks.

The Capital Allocation Question

ŌURA’s $11 billion valuation and $900 million raise dwarf entire sectors working on existential challenges. Investors are actively choosing to pour billions into optimizing sleep tracking for affluent consumers while transformational agricultural innovations addressing food security for billions can barely raise seed rounds.

This isn’t about business-model viability—it’s about what we’ve collectively decided deserves capital. The market has spoken clearly: it prefers quick-return consumer products with 18-month payback periods over longer-timeline deep tech that could fundamentally reshape how we feed the planet, cure diseases, or address climate change.

This raises uncomfortable questions:

• What if we applied the same creative financing structures to ag biotech that we do to consumer apps?

• What if “time to impact” mattered as much as “time to market”?

• What if we measured success not just by unicorn valuations but by lives improved per dollar invested?

Finding Your Why

For entrepreneurs and investors reading this, the invitation isn’t to abandon profitable ventures. It’s to ask what legacy you want to build and where capital is systematically underallocated relative to opportunity.

Both consumer products and transformational technologies create value. The question for investors is: where does capital scarcity meet massive market opportunity? Where are you early to markets that others are overlooking?

The good news: consumers are four times more likely to buy from mission-based companies, six times more likely to protect them during missteps, and 4.5× more likely to recommend them. Purpose increasingly drives both meaning and margins.

The Unit Economics Trap, and the Regulatory Reality

Here’s where it gets hard. Investors want “show me unit economics in 18 months.” That’s reasonable for a SaaS product. It’s unrealistic for a technology that could eliminate malaria or transform agricultural yields.

But it’s not just about development timelines—it’s about regulatory architecture. ŌURA faces wellness device guidelines that take months to navigate. Agricultural biotech faces EPA, FDA, and USDA approval processes spanning 5-10 years and costing $35-50 million. Clean energy technologies face permitting across federal, state, and local jurisdictions. Medical devices treating serious conditions require multi-phase clinical trials.

This creates a risk stack that traditional VC models can’t absorb: technical risk plus market timing risk plus regulatory risk. Consumer products sidestep this entirely. The funding gap isn’t just about investor impatience—it’s about structural barriers that make deep tech harder to capitalize.

Yet this regulatory complexity is precisely what creates defensibility. Consumer apps get cloned overnight. A patented, EPA-approved agricultural biotech that took seven years to clear regulation? That’s a moat competitors can’t cross without making the same investment. Once cleared, regulatory approval transforms from liability to asset—creating pricing power and competitive advantage that consumer products never achieve.

We need different capital for different problems. Consumer products can and should rely on traditional VC timelines. But transformational technologies need:

• Patient capital willing to wait 7–10 years

• Milestone-based funding that rewards scientific progress AND regulatory clearance, not just revenue

• Hybrid models combining grants, impact investors, and strategic corporate partners

• Metrics beyond IRR that include social return on investment

• Expertise in regulatory pathways that can derisk approval processes

And let’s be honest: liquidity across venture and private equity has already slowed. Exit horizons have stretched, and many funds are holding unrealized value far longer than expected. In that context, the real question isn’t how quickly you can exit—it’s what kind of value you’re holding while you wait. Owning defensible, IP-rich, regulatory-approved assets that solve fundamental problems isn’t idealistic—it’s pragmatic. Each regulatory milestone cleared increases enterprise value and reduces competition in ways that consumer products can never replicate.

Venture capitalists addressing global problems must learn to take risks again and look closely at deep-tech investments aligned with serving humanity in urgent ways—which will pay off in the long run.

The Investment Opportunity

For Limited Partners, this divergence creates a compelling arbitrage opportunity. While capital floods into crowded consumer categories with compressed multiples, deep tech remains systematically undervalued despite:

• Stronger long-term returns: 5× S&P 500 over 20 years for purpose-driven companies (Jump Associates)

• Higher barriers to entry: Strong IP through patents, trade secrets, and years of domain expertise create defensible moats

• Massive addressable markets: Food security ($9 T), healthcare innovation ($12 T), clean energy ($4 T+) represent enormous opportunities

• Structural tailwinds: Government support, ESG mandates, and shifting consumer preferences create favorable conditions

• Less competition: Fewer funds willing to deploy patient capital means less crowded cap tables and better entry valuations

This arbitrage exists not because deep-tech founders tell poor stories—many are learning to position brilliantly—but because the capital markets systematically underprice long-horizon, high-impact innovation relative to near-term consumer convenience.

This is more than moral alignment—it’s macro-risk mitigation. When the economy itself leans on affluent consumption, portfolios that broaden participation through food security, workforce resilience, and climate adaptation aren’t just impactful—they’re stabilizing. Purpose-driven companies already demonstrate superior performance; deep-tech enterprises extend that purpose to the structural foundations of the economy itself.

Deep-tech investors play a unique and essential role in financing the science and infrastructure that make cross-border cooperation possible while minimizing national vulnerabilities. The aim isn’t to pull apart the global economy, but to make it more resilient when shocks inevitably come.

What makes deep tech distinctive is that it addresses security at the most fundamental level—food and water supply, semiconductors, clean energy, advanced materials. These aren’t optional luxuries; they’re the foundations of national capability. And precisely because they’re fundamental, governments will always watch them closely and shape incentives around them.

As trade and supply chains face mounting strain, control over what matters most will matter most. A smartwatch is interesting, but the ability to feed your population or develop next-generation connectivity without depending on others is strategic. That imperative is investible—and the rigorous due diligence investors conduct may increasingly guide government policy, creating direct benefits for those investors.

We’ve already seen this dynamic with the CHIPS Act in the US and similar European legislation. The security concerns are real and translate into action. People will always need to eat and access water. They won’t always need a device to track their sleep patterns. Deep tech investors are backing what sustains civilizations.

The challenge isn’t finding impact—it’s finding the right capital structures, time horizons, and domain expertise to capture it. Deep-tech accelerators positioned at this inflection point can back founders solving foundational challenges with strong IP, long-term defensibility, and the potential for outlier returns that come from being early to systematically undervalued markets.

Making Your Choice

Nobody needs to choose between making money and making meaning. But we do need to be intentional about what we’re building and why.

If you’re creating the next dog-walking app, own that. Make it excellent, profitable, and successful.

If you’re working on carbon capture, regenerative agriculture, or disease elimination—and struggling for funding—know this: the future of business is increasingly defined not just by profits, but by the positive change companies create in the world. You’re playing the longer game, and that matters.

For investors, the question isn’t whether consumer products or impact technologies should exist. It’s whether to deploy capital where competition is fierce and multiples are high, or where innovation is transformational, defensibility is strong, and valuations haven’t yet caught up to potential. The data suggests the latter offers compelling risk-adjusted returns for those with the patience and conviction to see it through.

---

Thank you to Nirav Bisarya and Joff Wild for contributing to this post with their ideas and edits. Images provided by Mid Journey and Grok.