Web Summit 2019: 3 Take-Aways on the Future of Tech

While Web Summit has come and gone, many of the trends discussed in Lisbon every year are bellwethers for the years to come. While technologies like AI, 5G, Autonomous Vehicles and the Future of Work continued to be trending topics at the show, I noticed several larger trends that I believe speak to where the industry as a whole is headed and how it operates as the second decade of the 21st Century begins. 🐺

Here are the 3 main takeaways that stood out to us the most.

Speaking on the Venture Stage at Web Summit with Author & Advisor Diane Mulcahy on the Future of Work and the major trends and startups fueling it.

The Globalization of Tech

The technology industry is increasingly becoming more and more global. You can see this simply by walking the show floor — where over 160 countries were represented at the conference. To see an industry that used to primarily be dominated by those in Silicon Valley take deep root across Europe, Asia, the Middle East and now Africa is truly incredible.

Likewise, breakout startup success is no longer limited to Silicon Valley and the U.S. alone. Today, there are now approximately 500 Unicorns, or startups valued at or above $1 billion, worldwide. That’s up 79% from the 279 global Unicorns that were recognized in February of 2018. China is said to be the current leader with 206 Unicorns (one of which is Cathay portfolio company and autonomous driving Unicorn, Momenta), compared to 202 in the U.S. (including Chime, another Cathay investment and fintech Unicorn). India is now home to 21 Unicorns, the UK has 13, France with 7 and Germany has 7 also, just to name a few.

European Unicorns, from Bolt to Deliveroo to N26, are now offering new innovative products and services revolutionizing areas such as transportation, food delivery, financial services and so on. And Europe is home to the vast majority of the 70,000 startup founders, investors and technologists who attended Web Summit this year, which is now one of the world’s largest and most influential technology conferences.

At Cathay Innovation, we have long believed in the European startup scene, leading investments in companies such as Barcelona-based on-demand delivery service Glovo, Paris-based late-night ride-hailing app Heetch and Paris-headquartered on-demand freight startup OnTruck, among many others.

We are also strong believers in backing innovation in developing economies such as Africa. Shortly after Web Summit, I had the honor of moderating a panel at Fab Africa with 3 incredible female founders on the topic of customer insights, growth and the digital age in the African fashion and beauty sectors. We see a huge potential in Africa — a soon to be 2 billion customer market — which is why we recently partnered with Tunisia-based PE firm Africinvest to create the largest VC fund in Africa and fuel the startups creating new digital infrastructures and services throughout the country.

All Eyes on Impact

While new tech innovation is eye-catching, the even bigger focus this year seemed to be on impact. I consistently heard panelists to attendees themselves ask, “How can we develop and use technology for the greater good?” This is not an altogether new topic for Web Summit — where just last year the father of the world wide web, Tim Berners-Lee, announced a new campaign in Lisbon “to help the world build a better internet.”

This year, Web Summit welcomed high-profile speakers such as Akon, the rapper turned entrepreneur behind Akoin, Jaden Smith, co-founder of Just Water, Kate Brandt, Chief Sustainability Officer at Google and Lise King, CEO at UN Global Compact to name a few. These speakers, and many others, brought new ideas and approaches for attendees to consider that they believe will address global problems such as sustainability, privacy or the global digital divide.

Impact investing and social enterprise are also on the rise, growing to a $500 billion field today. At Cathay, while it’s not the only criteria we consider when making an investment, impact certainly plays a large part in our decision making. We’re proud of our portfolio companies who are doing their part to improve society such as Pinduoduo, a leading Chinese social commerce platform that last year enabled US $9 billion towards anti-poverty business exchanges.

What’s more, Chime, the top US challenger bank, has dedicated its energy to offer quality free banking to the American middle class and to those who are rejected from the system. While, KaiOS, an affordable smart-feature phone was awarded a spot on Fortune’s “Change the World list” for its efforts in bringing internet access to the world.

The core value of the internet is to connect people, businesses, and organizations of all kinds, and to do more with less through the combined power of the network and technological advancements for all. This was clearly on display at Web Summit and there are many other examples now appearing in our global investment portfolio. As more and more of these initiatives begin to materialize and show tangible results, we believe there will be an even larger push for meaningful impact in technology investments and innovation in the years to come.

Corporates are a Key Driver for Innovation

Corporate incumbents are increasingly looking to partner with startups. Last year, 264 new, unique CVCs invested for the first time, up 35% from 2017 according to CB Insights. Today, CVCs represent 50% of venture deals.

This isn’t just about investments. We believe the most successful innovations will not happen in silo. To scale, they require the support and buy-in of a broader ecosystem, particularly corporate incumbents. For example, organizations like Tencent and Alibaba in China, are becoming powerful enablers to their portfolio by offering them access to their platform, user base and know-how. The Tencent ecosystem for instance was one of the accelerators for Pinduoduo.

KaiOS, which recently launched in India in partnership with Jio, is another prime example of leveraging partnerships with corporations in order to scale and have the largest impact. Telco operators (e.g. MTN, Jio) act as key distributors, device manufacturers (e.g. TCL) pre-load the software onto phones, while technology partners (e.g. Google) provide critical support. Using this ecosystem approach, they have connected more than 100 million people to the internet for the first time.

The corporate value add model is close to our heart. At Cathay Innovation, about a third of our capital comes from global corporates, who are looking to work with startups and accelerate their digital transition. We are seeing first-hand how a global platform and strong collaboration between startups and corporates, who once considered themselves in different worlds, creates a common playing ground where all benefit from accelerated innovation, reaching new markets and increasing meaningful impact.

What Does it All Mean?

From the globalization of the tech industry to the increased participation of corporations and a greater focus on impact — our time at the Web Summit conference was a good reminder of where the industry is headed as a whole and a reminder of a shared responsibility as members of the community.

it is now time for venture capitalists, startups, and incumbent industry leaders, who are bringing new technologies to the world, to also set up a framework of relationships, criteria and metrics to both encourage and measure impact and make all of us accountable for positive outcomes. Stakeholders now have an opportunity to work together, like never before, in ways that can benefit all.

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Co-founder and CEO of Cathay Innovation