Why 78% of Chile’s Mining Tech Pilots Never Become Contracts

A successful pilot at a working copper mine is supposed to be the hard part. Prove the technology holds up in one of the most demanding industrial environments on earth, and the contract should follow. New data out of Chile says otherwise.

A study published on 28 September 2026 by Expande Minería de Fundación Chile, in partnership with Spencer Stuart and McKinsey & Company, found that 78% of surveyed startups report their first pilot as a technical success, yet only 38% recover the cost of running that trial. The engineering works. The business model quietly bleeds out.

Chile is the world’s leading copper producer and second-largest lithium producer. That gives its domestic startups an unrivalled testing ground. What the study makes clear is that a testing ground and a commercial launchpad are not the same thing, and the gap between them is where Chile mining tech startups are dying.

Chile’s position as the world’s dominant copper producer and second-largest lithium producer is not static; copper and lithium export volumes reached record highs in 2026, which simultaneously expands the domestic testing ground for mining technology startups and raises the economic stakes if that technology cannot be commercialised locally.

For anyone weighing an industrial technology investment, this reframes the whole exercise. Technical viability is table stakes. The real question is whether a company can survive corporate procurement long enough to get paid. Here is how that plays out, and what to watch for.

The funding paradox starving proven mining technologies

Start with where the money comes from, because in this sector it mostly comes from the founders themselves. The study of 180 valid responses found that 87% of these companies rely on self-generated funds, and roughly 40% operate with no external financial support whatsoever.

Only around 6% have secured venture capital.

Sit with that number for a moment. This is deep-tech for heavy industry, where deployment means hardware, integration with mission-critical plant, and complex software that has to survive real operating conditions. It is precisely the kind of work that demands patient, well-capitalised backing, and it is running almost entirely on the personal balance sheets of its founders.

The technical results only sharpen the contradiction. When these founders get a pilot, they usually deliver: 78% report a successful or conclusive first trial. But the money does not follow the merit. Barely more than a third recover their costs during that pilot, which means the majority are paying, out of their own pockets, for the privilege of proving a product to a client who has not yet agreed to buy it.

The read here is uncomfortable but useful. When you assess one of these companies, engineering brilliance is not your primary variable. Financial runway is. A team can be the best in the world at extracting copper more cleanly and still fail as a business because it runs out of cash waiting for a purchase order.

Pepe Barroilhet, a partner at Spencer Stuart, frames the stakes at a national level: Chile’s next economic cycle will likely hinge on exporting mining services and technology, not just the copper itself. If the startups building that future cannot fund themselves past the pilot stage, the export ambition stalls before it starts.

Understanding the architecture of Latin American mining innovation

To see why patient capital matters so much here, you need the map of how this ecosystem actually works. Chile has spent years building infrastructure to connect risk-averse miners with small technology suppliers, and the shape of that infrastructure tells you a great deal about where the money can and cannot flow.

At the centre sits Expande, an open-innovation platform run by Fundación Chile. Its job is to broker the relationship between mining companies and technology suppliers, and it has facilitated 190 contracts worth US$50 million to date. It also operates two dedicated pilot sites, controlled demonstration environments rather than live mines, where new technology can be tested before it goes anywhere near active production.

That connector role is one of Chile’s genuinely effective structural reforms. It lowers the cost for a major miner to find and qualify a small supplier, and it gives startups a structured door into operations that would otherwise be sealed shut. The catch is that a controlled test site can also become a comfortable place to test forever without ever adopting at scale.

Codelco, the state copper company, runs a parallel route through OpenCodelco, an acceleration programme operated with OpenBeauchef and the Advanced Mining Technology Center at Universidad de Chile. In July 2026, computer-vision startup Muon Vision was named one of four solutions advancing to piloting through the programme, evidence that the largest operator is formalising at least part of its startup intake.

Bridging the gap with specialist capital structures

Generalist technology funds tend to avoid this sector, and their reasons are rational. A SaaS company can go from launch to revenue in months; an industrial deep-tech company faces multi-year qualification, high capital intensity, and buyers who move at the pace of safety committees. That mismatch between fund lifecycle and sales cycle is why standard venture capital sits on the sidelines.

The vehicles that do work here are fundamentally different from mainstream technology investment, and the full range of mining capital structures available to deep-tech operators, spanning royalty streams, project finance, and hybrid grant-equity instruments, reflects how poorly standard venture economics map onto industrial deployment timelines.

The vehicles that do work are hybrids, blending grants, acceleration, and equity into structures that can absorb technical and market risk over long horizons. The main players include:

• ChileGlobal Ventures and the CLIN fund: A US$20 million impact-investment fund launched in 2018, layered on top of accelerator support and Corfo grants of up to CLP 60 million per company.
• Alza Mining Tech Fund: A dedicated mining-technology fund that led the sector’s most recent deal, a US$900,000 seed round for Chilean startup MineWatch on 14 September 2026.
• Aster and the Coppernico VC fund: An acceleration programme offering up to US$50,000 per startup, aimed at pre-seed and seed ventures chasing international scalability.
• Corporate venture arms such as SQM Lithium Ventures and BHP Ventures, which bring capital alongside a potential deployment pathway inside a major operator.

Lay these out side by side and the lesson is plain. The funding that fits this market is sector-specific and slow by design, because only that kind of capital is patient enough to match how industrial buyers actually make decisions.

Surviving the corporate pilot graveyard

Now walk in the founder’s shoes. You have a validated product and a controlled pilot behind you. What comes next is not a contract; it is a waiting game that most companies are not built to survive.

The clock alone is punishing. The study found that 55% of startups in the piloting stage need more than 12 months just to reach their first operational test, and typical pilot cycles run 12 to 18 months on top of that. For a self-funded team, that is over a year of expenditure before a single revenue-generating deployment is even on the table.

When a promising pilot then stalls, the reasons are rarely about the technology. 65% of respondents blame shifts in the client’s internal priorities, and 64% point to organisational risk-aversion and resistance to change inside the mining company. A further 51% cite procurement and contracting processes that were never designed to buy from small, emerging suppliers.

When pilots fail to advance, the root cause is overwhelmingly organisational rather than technical. Nearly two-thirds of startups attribute stalled progress to client risk-aversion and shifting priorities, not to any shortcoming in the product itself.

The organisational psychology is where this hardens into a structural trap. The operations and maintenance teams asked to adopt a new technology carry the entire downside if it disrupts production or safety, yet they capture almost none of the upside if it succeeds. Rationally, the safest move for an individual manager is to keep testing and never commit.

The organisational psychology driving this behaviour is not unique to Chile; mining innovation adoption faces structurally similar resistance across every major producing jurisdiction, where operational teams carry asymmetric downside risk from deploying unproven technology while capturing almost none of the upside.

For your due diligence, this changes the checklist entirely. A technically flawless product with no internal champion at the client site is a stalled pilot waiting to happen. You need to know who inside the mining company owns the deployment, whether they have budget authority, and whether that authority survives the next reshuffle of priorities. Validation data will not answer those questions, and validation data is not what kills these companies.

Catalysts for commercial scale and export viability

The diagnosis is bleak, but it points directly at the cure. The September study does not just describe the bottleneck; it prescribes the structural reforms needed to clear it, and there is already a live example of what breaking through looks like.

Barroilhet’s central recommendation is disarmingly simple: mining companies should stop treating innovation as an informal favour and start treating it as a budgeted line item with annual performance targets, held to the same standard as any other corporate investment. That single change attacks the root of the resistance problem, because when adoption becomes a manager’s KPI rather than a personal risk, the incentive to keep stalling disappears.

The full set of reforms the study calls for runs as follows:

1. Formalise innovation budgets inside mining companies, with annual targets rather than ad hoc goodwill.
2. Diversify financing sources so startups are not left dependent on founder capital.
3. Accelerate pilot cycles to cut the year-plus timeline that drains cash before revenue arrives.
4. Adapt procurement and contracting frameworks so major operators can actually buy from emerging suppliers.

The clearest proof that the model can work is Ceibo, a Chilean startup in sustainable copper extraction that secured over US$30 million in Series B funding from BHP Ventures. What makes that deal instructive is not the size but the structure: a corporate investor that can also open the door to operational deployment inside its own mines.

That is the pattern worth hunting for. The corporate venture capital model bundles capital, technical validation, and a route to scaled contracts into a single relationship, which lets a startup step around the procurement maze rather than dying in it. When the backer can dictate the deployment pathway, the pilot graveyard stops being the default destination.

Which leaves the open question the study cannot answer on its own. If these reforms take hold, Chile could become a genuine exporter of mining technology to jurisdictions like Australia and Canada. If they do not, it risks remaining an excellent testbed whose best ideas are ultimately commercialised by foreign capital.

Redefining due diligence for heavy industry technology

The single most important shift this study demands is a mental one. Scaling a mining technology is not, at its core, an engineering challenge. It is a procurement challenge, and the two require completely different things from the companies that solve them and the investors who back them.

So adjust the criteria accordingly. A pilot announcement is not a milestone worth celebrating until you can see the commercialisation pathway behind it: the internal champion, the budget line, the contracting route that turns a successful trial into a repeatable contract. Absent those, a strong pilot is a cost centre, not a catalyst.

For investors wanting to build out the full checklist beyond the procurement and champion questions raised here, our dedicated guide to mining due diligence frameworks covers the technical assessment process in detail, including how to evaluate operator relationships and commercialisation risk alongside geological and resource data.

The next twelve to eighteen months of Chilean reform will decide the outcome. Whether local startups capture global market share or simply provide cheap research and development for foreign acquirers depends on whether miners formalise their innovation budgets and rebuild procurement for emerging suppliers. Watch that, not the pilot press releases.

This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with financial professionals before making investment decisions. Past performance does not guarantee future results, and forward-looking statements are subject to market conditions and various risk factors.