Innovation
Securing and scaling the UK’s foundational systems: Inside our Critical Infrastructure Innovation Day
- Innovation
- Article
- 5 minutes read
Keeping the UK’s critical infrastructure stable is vital. But stability alone isn’t enough. Technology is moving fast, and new risks are emerging. To stay secure, we need to adopt new ideas in a safe, responsible way. The real question is how. We recently brought together large corporates, government bodies, investors and founders in London to discuss how startups can help strengthen critical infrastructure, and how to make partnerships work. All discussions were held under Chatham House rules.
- Energy is a major constraint when scaling systems and rolling out new infrastructure.
- Collaboration is key, but revenue matters. Founders should push for paid pilots and paid proofs-of-concept where possible.
- Equity is often the main funding route for early-stage deep tech, but founders should consider additional funding options such as debt as they grow.
Critical infrastructure is a blanket term for the infrastructure and systems we rely on each day to keep society running. Energy, water, transportation, and healthcare help to keep us fed, watered, charged up and, of course, safe.
It’s a complex space where emerging ideas regularly meet existing infrastructure limitations. As technology advances, two questions come into focus:
- How do we protect these systems as they evolve?
- How can the organisations that run the infrastructure partner with startups that are building products that could help solve national challenges?
We brought stakeholders from around the ecosystem together to think about ways to inject innovation into critical infrastructure challenges and to answer these questions.
Here’s a summary of what we learned.
Building resilient infrastructure is a team sport
To open the day, Emily Turner, HSBC Innovation Banking UK CEO, joined Nvidia’s Anthony Hills for a fireside chat. They spoke about the scale of the future energy challenge. They also discussed just how important it is for people from across the tech ecosystem to work together to tackle complex problems collectively.
This rich discussion led into the day’s first panel. Representatives from core national infrastructure companies and government agencies shared their views on resilience.
The volume and nature of change that utilities and other core system operators have encountered stood out immediately. A senior leader from a utility provider said: “we used to have four weather settings, for spring, summer, autumn and winter, all of which worked on assumptions”. Today, near real-time weather data supports better decisions and steadier performance.
This is a clear example of the kind of opportunity and improvement that new tech offers. But it also brings with it new risks. As one panellist put it:
"You can’t just spend money and make threats go away, unfortunately."
Given how important these systems are, and their impact on national security, startups and operators must integrate tech responsibly. Bottom line? Resilience and responsible risk management are not negotiable.
Inspiring innovative infrastructure solves: Why startups and operators work well together
Collaboration between infrastructure operators and startups can benefit both.
For established operators, working with startups shows real intent, if providers keep “explaining why you are doing what you’re doing to the outside world”. Opening the door to startups signals that their organisation is serious about modernising key systems.
Collaboration can also help internal teams stay close to new ideas. As one participant said: “Our technologists love working with other technologists: you see their eyes light up.”
Partnerships can also help the public sector do more with limited budgets. As one panellist said:
"Government agencies don’t actually have huge budgets...which makes us quite receptive to projects where we can share some of the R&D costs."
Even so, partnerships need a clear commercial base – even if they may advance the national interest. The advice to founders? Showcasing revenue is crucial as you scale, so push for paid commercial agreements - even in the form of a pilot or trial period.
Invested in infrastructure: Discussing deep tech fundraising
For many years, venture capital (VC) focused on capital-light software-as-a-service (SaaS) businesses. That left deep tech and industrials fighting for attention and capital.
But that picture is changing - fast.
The 2026 European Deep Tech Report found that 32% of all VC funding in 2025 went to deep tech, an all-time high.
READ MORE ABOUT COMMON DEEP TECH MYTHS HERE
To understand this shift, our second panel offered first-hand founder perspectives on scaling and industrialising in deep tech. The final panel countered with the investor view from prominent angel investors and partners at leading VC firms.
Across the founder and investor panels, three themes stood out.
1. Margins and unit economics are difficult, but not impossible
“Hardware is hard”. But many modern hardware and deep tech companies are showcasing strong margins as they grow.
One panellist, who’s building in robotics, reflected that his company has reaped “the benefits of vertical integration, which speeds up deployment times (highly appreciated by customers) and reduces structural dependency on partners.”
2. Terms matter when you’re engineering powerful partnerships
The right partner can bring trust and reach. But founders also warned against tight terms.
As one panellist said, “Partnerships are great, as long as there aren’t regressive clauses around exclusivity.”
Again, risk came to the fore. Panellists mentioned the risk of putting all your eggs in the basket of one large partner, while acknowledging that “a global brand or government agency is a huge superpower and credibility factor” that, if successful, can unlock new business and relationships
3. Bold ambition needs a clear market
Where startups bring dynamic energy and speed, larger organisations often have defined longer-term business plans.
Bridging that gap is key. Founders need to understand the long-term plan for their business, while operators need to ensure they’re ready to integrate innovation in their strategic roadmap.
Experienced VCs can play an important role here. They can offer crucial guidance to passionate early-stage founders who may be devoted to developing a new technology without a clear sense of the end-state viability of their company.
The question VCs can help founders answer? As one panellist said,
"When you get to the end of the rainbow, even if your tech is amazing, is there a market for what you’re building?"
Infrastructure in demand: What happens next?
Industrial innovation is a core muscle for the UK and there is real momentum. Interest in deep tech is rising. Many corporates and government agencies want to work with startups. If more doors open to partnership, and more founders can access early-stage capital, the UK is well placed to build a strong innovation flywheel across the systems we all rely on.
Any opinions expressed are merely opinions and not facts. All information in this document is for general informational purposes and not to be construed as professional advice or to create a professional relationship and the information is not intended as a substitute for professional advice. Nothing in this document takes into account your company’s individual circumstances. HSBC Innovation Banking does not make any representations or warranties with respect to the accuracy, applicability, fitness or completeness of this document and the material may not reflect the most current legal or regulatory developments. HSBC Innovation Banking disclaims all liability in respect to actions taken or not taken based on any or all of the contents in this document to the fullest extent permitted by law. Nothing relating to this material should be construed as a solicitation or offer, or recommendation, to acquire or dispose of any investment or to engage in any other transaction.
