Ever since the Covid-19 pandemic hit the market, venture capital-backed technology firms have exceeded all anticipations and have been a major factor in the global economic revival.
It's becoming more and more evident that the VC atmosphere is the only remaining origin of energy in a world economy deprived of novel ideas. Given that in 2021, investment into the European venture field reached a record high.
Considering our improved dependence on the invention, effectiveness, and problem-solving skills presented by VC-backed tech, we expect investment to accelerate in the upcoming year. Below are a few trends and technologies that will likely influence these investment choices.
It may appear that large corporations have a strong grip on the market, but smaller companies that are profitable and beneficial to society still have an opportunity. Although the pandemic has caused many businesses to close, it has also created various new possibilities.
Startups can take advantage of new technology and markets that weren't available before to create more efficient, cost-effective, and innovative products and services. By taking advantage of these opportunities, smaller businesses can capitalize on their unique strengths and emerge as formidable competitors.
3D printing is revolutionizing the way the world creates things. This cutting-edge technology is helping startups reduce their reliance on traditional manufacturing, enabling them to produce new products faster and more cost-effectively.
According to recent research, the global 3D printing business market is projected to reach $76.17 billion by 2030, with a CAGR of 20.8%.
The potential of 3D printing has been particularly appealing to startups due to its rapid prototyping capabilities and low overhead costs. This technology allows entrepreneurs to quickly create prototypes of their designs without having to purchase expensive equipment or pay for long production times.
Additionally, 3D printing makes it possible for businesses to customize existing products or create entirely new ones without having a huge budget. Furthermore, mass-producing products with 3D printers is becoming increasingly affordable as technology continues to improve.
One example of a successful 3D printing startup is BotFactory which has developed a desktop-sized machine that can assemble circuit boards at home. This innovative product has allowed BotFactory's customers to design and test new electronics faster than ever before. The company has also been able to scale up production quickly and expand its customer base due in part to its low-cost manufacturing process enabled by 3D printers.
More and more startups are taking advantage of the perks that come with utilizing 3D printing technology, including rapid prototyping, customization, scalability, and cost efficiency compared with traditional manufacturing methods, allowing them to bring new inventions and ideas into the market quickly and effectively while reducing the risks associated with launching a business venture.
Agriculture startups have been on the cliff over the past few years, with a record jump in Agri tech startup investment by 2-fold to $4.6 billion in FY22. This trend is driven by increasing demand for sustainable and local food production, as well as technological advancements that allow for more efficient farming practices.
For example, indoor farming startups such as AeroFarms and Gotham Greens are using hydroponics and LED lighting to grow leafy greens in urban areas. At the same time, FarmWise has developed autonomous robots to reduce labor costs. These technologies offer significant cost savings while providing greater control over the environment in which crops are grown.
In conclusion, with increasing demand for sustainable food production and technological advancements making indoor farming more accessible than ever before, there is a growing trend towards agriculture-based startups offering innovative solutions to current challenges faced by farmers worldwide.
As evidenced by rising venture capital investments and increasing numbers of new firms entering the market, this trend is likely to continue into 2023 and beyond.
The AI startup industry is already exploding and expected to continue its rapid growth in the coming years, with market predictions forecasting a value of over $14 billion by 2023. This is largely driven by the increasing demand for innovative and disruptive AI-powered solutions from both established tech companies and startups alike.
According to a recent report by IBM, almost two third of organizations are already planning to increase their investments in AI technologies. This indicates that businesses realize the potential for AI to revolutionize operations and unlock new revenue streams.
Lastly, with increasing venture capital investments, growing interest from established tech firms, and a burgeoning talent pool, it is clear that there are exciting times ahead for AI startups in 2023 and beyond. Startups should take advantage of this opportunity to capitalize on innovative solutions and drive growth in their businesses.
Here are the top AI startups you can learn from:
Climate tech is an emerging industry revolutionizing how we approach environmental sustainability. Climate tech startups are utilizing innovative technologies to help the world reduce its carbon footprint while creating cost savings and improved efficiency for businesses.
According to a report from Pitchbook, climate tech is a growing sector, with investments in 2022 Q1 totaling $9 billion across 273 deals. This trend is expected to remain alive in 2023.
Some of the most popular segments of focus for climate tech startups include clean energy technologies such as solar & wind power, energy storage solutions, and smart grid technology, as well as AI-powered solutions for reducing emissions and improving efficiency.
For example, US-based startup SunPower has developed an AI-driven platform that helps solar energy companies better manage their operations and reduce customer churn rates. Another startup called CarbonCure Technologies uses AI and machine learning to help building material producers reduce their CO2 emissions.
Lastly, the growth of the climate tech sector shows no signs of slowing down in the near future; it will only continue to accelerate over the next few years as businesses become more aware of the need for sustainability measures.
2023 is expected to be a big year for cybersecurity startups due to the rising threat of cybercrime and an increased focus on digital security. According to Fortune Business Insights, the global cybersecurity market is set to reach $376.32 billion by 2029, with a CAGR of 13.4%. This is indicative of the fact that businesses today are becoming more aware of the need for robust cybersecurity solutions and are willing to invest heavily in this space.
Furthermore, venture capital investments in cybersecurity startups have also been steadily increasing over the last few years. In 2021, VCs invested over $21.8 billion into cybersecurity startups worldwide, and this number is expected to grow even further in 2023 as investors become increasingly confident in the potential rewards these companies offer.
Some of the most notable recent investments include Cylance ($297 million), Cybereason ($275 million), and CrowdStrike ($485 million). This trend is likely to continue into 2023 as investors recognize the value of investing in cutting-edge cybersecurity solutions that can protect businesses from evolving threats.
Overall, with increasing investment and a rising demand for advanced digital security solutions, 2023 looks like it will be a critical year for cybersecurity startups. Companies in this space are likely to benefit from increased funding and positive investor sentiment going forward, which could lead to significant growth opportunities for those able to capitalize on them.
Digital health startups have seen a surge in investment in 2021, with venture capital fundraising in the sector reaching $29.1 billion globally. Although 2021 and the coming year will see a bit decline in the total funding, the market still has much potential.
Some of the most notable recent investments include Omada Health ($448.5 million), Ro ($1 billion), and Livongo ($235 million). This investment trend is being driven by increasing consumer demand for digital health solutions, with patients being more likely to use technology to improve their healthcare experience.
In addition, the rising adoption of telemedicine and remote patient monitoring services has made it easier for digital health companies to reach patients in previously untapped markets. This has allowed them to expand their customer base and drive growth in many areas, such as chronic care management, diagnostics and analytics, and mental health services.
Overall, 2023 looks like it will be a critical year for digital health startups, given the continuing high levels of investor interest and customer demand for digital health solutions. Companies that are able to capitalize on these trends could see significant returns on their investments, making this an exciting time for those involved in the sector.
The direct-to-consumer (DTC) startup trend is growing rapidly in the retail sector. As the DTC brands have the potential to take market share from already-established retail giants, venture capitalists have put in between $8 and $10 billion in them since the beginning of 2019.
One of the main drivers behind this trend is the shift toward digital commerce and eCommerce. With more people shopping online, there has been a surge of new DTC brands that are leveraging digital platforms to reach their customers directly. This has enabled them to cut out traditional retail middlemen like wholesalers, distributors, and even marketplaces like Amazon, creating a more efficient and cost-effective way for those brands to reach their consumers.
In addition, the rise of social media has allowed DTC startups to build relationships with their customers through engaging content, providing personalized experiences, and driving sales growth by reaching potential customers who may have previously been inaccessible.
Lastly, due to the Covid-19 pandemic, the world has seen an increase in demand for contactless services, providing an opportunity for many DTC startups to offer delivery and curbside pickup services as well as other innovative solutions.
Overall, it seems that the direct-to-consumer trend will only continue to grow in 2023 as more businesses look for ways to capitalize on this growing market opportunity. As such, we can expect even more investment capital flowing into DTC startups as well as increasingly sophisticated digital marketing strategies being employed by these companies.
The electronic vehicle (EV) startup trend is gaining traction in 2023 as more and more companies recognize the potential of this technology as a substitute for combustion engines. In fact, a recent report by IEA predicts that 13% of the automobiles marketed in 2022 will be electric vehicles, owing to their growing popularity among passengers.
This surge in EV ownership can be attributed to a combination of factors such as government incentives and subsidies, falling battery costs, and the emergence of more reliable and affordable electric vehicle models. Additionally, many EV startups have introduced novel features such as autonomous driving capabilities or charging station networks that have helped to make them even more attractive to consumers.
With the global EV market estimated to grow from 8,151 units in 2022 to 39,208 by 2030, there is significant potential for growth in this sector. Numerous startups are thus entering the field with innovative products, such as long-range electric vehicles with extended battery life. Examples include Tesla's Model S and X, Nio's ES8 electric SUV, and Rivian's R1T pickup truck.
Overall, it is clear that the electric vehicle startup trend will continue to grow in 2023 and beyond due to increasing consumer demand for this type of technology combined with venture capital investment flowing into these companies. Furthermore, with new innovations being introduced each day and a growing number of players entering the market space, it seems likely that this trend will remain strong throughout the year ahead.
If you have started working on a startup idea or are looking for one that is in trend, these eight startup segments should be your priority. Even if your startup doesn't fall into these categories, you can incorporate some elements of them into your idea. For instance, introducing AI to your startup shouldn't be difficult.
