Finding a Market for Fusion Technology

Deep tech companies face a particular commercial challenge. Developing the technology can take years, require specialist expertise and consume significant capital, while the market for the finished product may still be uncertain. Founders have to make decisions about customers, revenue and investment long before they have a fully developed business.

That creates a difficult balancing act. How do you generate revenue while continuing to develop the technology? When should you pursue an adjacent market? And how do you know whether early commercial opportunities are helping you build the business you ultimately want?

These are questions that apply across deep tech, from advanced materials and medical devices to robotics, energy and life sciences. They also raise some important lessons about how founders approach commercialisation.

For Astral Systems, a UK-based fusion technology company, the approach has been different. Rather than focusing exclusively on generating electricity through fusion, the company has built a business around the near-term applications of its technology, including neutron generation for materials testing and the development of medical isotopes.

In the latest episode of Nothing Ventured, hosted by EmergeOne founder and CEO Aarish Shah, Astral Systems CEO Talmon Firestone explains how this strategy has helped the company generate revenue, validate its technology and build towards its longer-term ambitions.

Finding a market before the end goal is ready

In deep tech, the most ambitious application of a technology is often the one that attracts the most attention. It may also be the hardest to bring to market.

Fusion is a good example. The prospect of generating energy through fusion has enormous potential, but developing commercially viable power generation systems is a long-term undertaking. Meanwhile, the underlying technology may have other applications that customers need today.

This creates an opportunity for founders to identify markets where their technology can solve a more immediate problem, even if those markets are smaller than the eventual opportunity.

For a company developing a new material, that might mean supplying components for an existing industrial process before targeting a more ambitious application. For a medical technology business, it could involve selling research tools or diagnostic equipment while working towards a longer regulatory pathway.

The commercial question is whether these early applications provide a credible route to market. Founders need to understand who the customer is, what problem the technology solves, how much that problem costs the customer and what they would be willing to pay for a solution.

A technically impressive product is unlikely to become a viable business without those answers. Early market selection should therefore be part of product development, rather than something founders leave until the technology is ready.

Early revenue can fund progress, but it comes with trade-offs

Raising investment is often treated as the default way to finance technical development. However, some deep tech companies can generate revenue before their core product is ready for widespread commercial use.

For founders, paid research, feasibility studies, contract development and specialist testing can all provide potential sources of early income. These activities can also create relationships with prospective customers, helping companies understand practical requirements before committing to a larger product rollout.

There is, however, a trade-off. Customer projects can absorb engineering time, pull teams towards bespoke requirements and create pressure to prioritise immediate income over longer-term product development.

Founders need to assess whether each commercial opportunity builds capabilities, relationships or knowledge that will support the core business. Revenue is useful, but its quality matters too. A growing stream of customised projects may look encouraging financially while making it harder to develop a repeatable product.

The aim is to use early commercial work deliberately, with a clear understanding of how it fits into the wider strategy.

A working technology is only one part of a scalable business

Technical milestones are important in deep tech, but they do not necessarily indicate that a company is ready to scale.

A prototype might work reliably in a controlled environment while production remains expensive, manufacturing capacity is limited or the necessary facilities are difficult to secure. Each of these constraints can affect the time, cost and capital required to serve customers.

Astral Systems, for example, has faced infrastructure constraints as it develops its fusion-based neutron technology. Operating additional systems requires specialist facilities with radiation shielding, creating a physical bottleneck even as the underlying technology progresses.

This illustrates a wider issue for hardware-intensive businesses. Scaling may depend as much on access to facilities, equipment and production capacity as it does on further technical breakthroughs.

These requirements need to be reflected in financial planning. Founders should model the cost of moving from demonstration to repeatable delivery, including the equipment, people and infrastructure required at each stage. They also need to understand how much capacity they can add with each new round of funding, and when that capacity is likely to generate revenue.

Without this work, a business can reach an important technical milestone only to discover that it lacks the resources to turn that progress into commercial growth.

The team needs to balance research with delivery

Deep tech companies often begin with founders whose expertise lies in science or engineering. That expertise is essential, but building a company requires a broader set of capabilities.

Research teams are focused on understanding problems, testing hypotheses and improving performance. Commercial teams need to establish customer requirements, manage delivery, price products and build repeatable processes. These priorities can compete for time and resources, particularly in a small business.

Founders need to decide how these functions will work together as the company grows. That does not necessarily mean hiring a large commercial team early. It does mean ensuring that customer feedback reaches the people developing the technology, and that technical decisions account for the realities of delivering a product.

It also means being clear about the kind of company the founders want to build. A business focused on maximising long-term valuation may make different decisions from one prioritising near-term profitability and sustainable growth. Neither approach removes the need for commercial discipline, but the chosen strategy should guide decisions about hiring, pricing, product development and investment.

Capital requirements change as the business develops

The financing needed to prove a technology can look very different from the financing needed to manufacture it, build infrastructure or expand into new markets.

Early funding might support a small technical team and initial experiments. Later stages may require substantial investment before additional capacity can generate meaningful revenue. Founders need to understand these changes well before they begin raising each round.

External investment remains important for businesses with long development cycles and significant upfront costs. However, founders should be clear about what each round is expected to achieve, which risks it will reduce and what evidence will be needed to attract the next source of capital.

Early revenue can strengthen that position, as it provides evidence of customer demand and may reduce reliance on investment to fund every stage of development. It cannot, on its own, finance every capital-intensive business. The funding strategy needs to account for the economics of the technology and the route to commercial scale.

This is also where financial planning becomes particularly important. A model should connect technical milestones to hiring, expenditure, production capacity and expected revenue, rather than treating fundraising as a standalone exercise.

Commercialisation needs to start early

For deep tech founders, the challenge is to develop the technology and the business at the same time. That means testing customer demand before the final product is ready, using early revenue carefully, understanding the practical barriers to scale and planning for the changing capital requirements of the company.

The most promising technical solution will still face difficult commercial decisions. Founders who address those decisions early have a clearer basis for deciding which markets to pursue, what to build next and how much capital they actually need.

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