Investing is a gut-wrenching adventure with many expected and unexpected twists and turns involved. Startup investing can be a lucrative experience, but depending on the types of investors and activities involved in pushing interest in the particular item, society catching on to the new deal can be a bit strenuous. Certain sectors affect tech startups a bit more than others, according to KPMG Startup Trends Index:
- 37% of the consumer goods sector influences startup growth
- 24% of the media and entertainment sector influences startup growth
- 10% of the banking sector influences startup growth.
Some firms like like Vista Equity Partners also invest in the tech sector. Since most tech is available to the consumer and tends to be a socially discussed feature of the world, it should go without saying that tech startups rely a lot on society to be lucrative enough to survive. Sadly, most startups fail due to a combination of reasons, most of which have to do with leadership, product/service awareness, and growing pains. Likewise, startups tend to follow trends of bigger businesses, and innovate based on what is seen and done in the media and in certain technologies, such as video game consoles or smartphones. Popular groups for startups include:
- Digital payments, such as ModoPayment and Zooz, with their share of angel investors and venture capital firms, that hope to create new ways to easily pay.
- Cloud computing, such as Infinite io and CoreOS, seek to mitigate expenses in increasing storage in technology, combating hard drives and expensive alternatives to cloud computing.
- Big data and analytics, though a bit broader and more complicated, includes companies that handle large data processing like Actian, or do real-time dashboards like Visual Revenue.
On the other hand, certain categories for startups aren’t progressing as well as the few mentioned above, for multiple reasons. Though the market is there, the tech tends to follow the mainstream without being creative- though again, it’s a bit difficult to innovate when tech is still so young! Here are some groups that aren’t doing so hot:
- Quantum computing, where places like Rigetti Computing and D-Wave Systems hope to usher in a new era of quantum computers and further developing society with a complex chip.
- Home health monitoring is a remote form of monitoring patients with ease and comfort in their own homes, and boats lower readmission percentages and higher patient satisfaction than hospital stays, according to VivifyHealth.
- Wearables include healthcare and messaging systems. A conglomerate of items to wear on your body that apparently benefit you more than a cell phone, somehow. (Don’t quote us on that – weird things tend to be the future, or at least find their niche, like Segways and mall cops.)
Tech startups seem to be flourishing where there is room to flourish, and wilt where there is no need. Based on trends, we can extrapolate from this data that technology will broaden and investors will be drawn to its charm and competency when the industry has a yearning for a new breed of toy or function to make life much more simple.