Point Nine Capital 2016 Team Predictions
The prediction season for 2016 is coming to an end (ok let’s admit it, we’re probably a bit late) and since at Point Nine we not only enjoy reflecting on the past but also like to think of what’s next, here are not 9 but 12 predictions from the P9 crew.
Co-Founder & Managing Partner
Berlin becomes a VC financing hub
As fundraising for Berlin startups becomes increasingly doable in the city itself, without the startups having to fly to London or other more established fundraising locations, Berlin is slowly but surely becoming a fundraising spot.
Rumour has it that a few new funds are being raised in Berlin right now (by new and existing groups) and more European VCs will open a Berlin office.
Even if not all of the current gossip materializes, it seems very likely that in 2016 Berlin will start developing a critical mass of early stage funds (Seed, Series A, maybe some Series B) with decision making here on the ground.
Berlin will thus become a fundraising location and a destination for startups from the rest of Europe (esp. central, eastern and southern Europe) to come to for fundraising. This will even accelerate the growth of the Berlin ecosystem.
Co-Founder & Managing Partner
2016 will be the best year yet for European startups looking for a seed or Series A investor
European Venture Capital has never had a great reputation. Compared to the Bay area, the size and the sophistication of the funding ecosystem has been poor. But in the last 12–18 months we’ve seen an unprecedented number of new funds and changes in the European VC landscape:
- Saul and Robin Klein have left Index to start a new seed fund.
- Ciarán O’Leary and Jason Whitmire have left Earlybird to launch a new early-stage fund called BlueYard.
- Roberto Bonanzinga, a former partner at Balderton Capital, has launched InReach Ventures.
- Simon Levene, a former partner at Accel and Index, has started Mosaic Ventures.
- Accel has hired Fred Destin, Balderton has hired Suranga Chandratillake, Index has hired Ilya Fushman, …
Increased competition means that startups have more choice and that VCs will work harder to prove that they can provide value-add beyond the money. It feels like the the European VC ecosystem is coming of age … and all the changes we’ve seen in 2014 and especially 2015 lead me to believe that 2016 will be the best year yet for European startups looking for early-stage funding.
Principal
Marketplaces will continue to be unbundled, uberized and SaaS-ified
At Point Nine, we observed and continue to strongly believe in the following 3 trends around digital marketplaces:
- Continued “Unbundling” of horizontally structured marketplaces into dedicated, vertically structured platforms
- “Uberization” of marketplaces: marketplaces strive to “own” the transaction so that everything is dynamically bookable on demand
- Line between SaaS and marketplaces becomes more blurry: product-offerings of marketplaces are becoming so strong that eventually there are multiple ways to monetize (subscription or transaction-based)
Here are some examples of deals we have done in 2015 that illustrate the trends above: Deskbookers (NL), Eversport (AT), StarOfService (FR).
You can find a more detailed outlook on 2016 on Mathias’ medium channel (and, while you at it, don’t forget to follow him on Twitter.)
Principal
Security & developer tools will at the center of attention
We know it has been mentioned endless times, but software is eating the world and it has two key implications for the short-term future:
a) More people with limited understanding of technology risks are heavy users of it. Large companies have the resources, but are still failing at it. Smaller companies (SMBs) who don’t have the resources will become an easier and equally profitable target for mass-scale cyber attacks.
b) Developers are the new rockstars and the biggest opportunities lie in the areas which attract the brightest minds:
- Open source appeals to developers willing to solve complex problems. But monetizing open source software is hard. Solving those problems through APIs can be a more profitable model and is equally appealing in terms of challenges.
- Slack is currently the hot sh**t among developers. Being quite an open platform, I expect it to give birth to a future unicorn.
- Machine learning and AI is the new teenage sex … they will be part of every pitch, but when it comes to the state of the art of these fields I believe that we’re still too early for widespread implementation.
Principal
The subscription model will increasingly be accepted in the consumer space
Driven by widely successful consumer plays like Spotify and Netflix, subscription dynamics (similar to SaaS) will increasingly be accepted in the consumer space and allow for interesting new opportunities like Yoogaia, Helpling, Green Blender and Marley Spoon from the P9Family.
Dominik Zalewski
Finance Director
VC funds operations & back office will undergo interesting changes
- EU financial regulators will work hard to keep VCs busy on the compliance front — which in practice will mean more reporting for even smaller firms and and harsher execution of deadlines.
- Talents will move from traditional financial sectors to operation departments of new and growing VC funds.
- Berlin CFO/COO network will become more connected and visible.
- Fund administrators specialised in early stage VCs will emerge to compete with big advisory firms and old school players in the area of back office operations outsourcing.
- Banks will realign their strategy towards startups and VCs showing more understanding of the industry and more friendly approach.
Karolin Geike
Team Assistant
We’ll use more AI personal assistants but they’ll still need human supervision
Some time in the future, AI-based solutions such as x.ai or Comtravo will get better than humans at scheduling meetings or booking flights, though the digital PAs will only be very good at one thing (I don’t see a silver bullet). But not in 2016. For now I’m happy to take on any silicon-based contender!
Jenny Buch
Talent Manager
Company culture and employer branding will be central to recruiting
In 2016 your number one recruiting lever will be your company culture and a strong employer branding. The top talents will have plenty of options to pick for work and will join the companies with the most interesting mission, the best people and the (potentially) most fun to work at.
There will be more HR tools that help around HR marketing activities and how to track and analyze them (such as goodwords). Because of this Talent war, HR will become more open minded, agile and creative in order to keep their employees happy.
Analyst
The way people move, work and buy will change
- The freelance economy will continue to grow and the market will start to select winners from losers amongst existing on-demand marketplaces
- Customer loyalty will be key with the rise of subscription business models
- Autonomous driving will open a wide range of opportunities for innovation and disruption (insurance, cyber security,etc.)
Research Analyst
Messaging platforms will give birth to a new breed of mobile first SaaS players
In 2015 most successful “mobile first” SaaS were either horizontal productivity tools (messaging, calendar, team communication, expenses) or vertical tools for businesses for which workforce mobility is important (field sales, construction industry).
For many software categories, mobile alone was not enough to compete with “non mobile first” existing players. Messaging platforms might be the catalyst that was missing. I expect more interesting horizontal mobile first SaaS in 2016, built on top of Whatsapp, Slack, Messenger etc…
France is going to win the UEFA Euro 2016.
Advisor
“The Bubble” becomes “The New Normal”
Entering 2016, the venture market has started slowing, valuations are coming down, and some of the weakest private “unicorns” are struggling to meet the high expectations implied by their valuations. The year will start with a chorus of “The bubble is over!” tinged with a bit of Schadenfreude.
But as the year progresses, several private tech companies will grow into breakout successes. We’ll see several S-1's filed with stellar financials and some huge exits that more than pay for the losers. Startups with great teams and large markets will grow nicely, and the venture market will stabilize at a brisk (but not bubbly) investment pace.
We’ll realize the “bubble or not a bubble?” debate was a distraction from the more interesting reality: the industry has many years of growth ahead as tech impacts every industry and every nook and cranny of our lives.
Advisor
Doctors will start prescribing mobile apps
In 2013 the first mobile health product secured reimbursement in the US. In 2014 the first European health insurer started reimbursing mobile apps. 2015 brought reimbursements for even more mobile solutions.
As doctors are crucial gateways for wide adoption of new medical solutions I expect 2016 to bring to life a first successful go-to-market strategy for mobile apps based on doctors prescribing a mobile app.
