2020 Predictions: Looking Backward
Authored by Krishan Allen.
Every twelve months, when looking at the new year ahead, we can’t help but guess what happens next. It’s tough to resist pulling out the crystal ball. And well, many of the events of 2020 were tough to foresee. Despite this, some people did manage to get their forecasts right.
This article celebrates the predictions that worked. We look at hypotheses made about the European tech ecosystem ahead of 2020 in this Sifted article and highlight who got what right.
1)The year digital health grows up
— Claire Novorol, Co-Founder and Chief Medical Officer, Ada Health
Digital Health as a category took leaps forward in 2020, culminating in a record quarter (as of Q3 2020) for global investment dollars. At $21.8bn invested globally, this was a 1.6x increase YoY and a full $3.4 billion greater than the previous record high (set just the quarter before).
Within Europe specifically, Q3 2020 and Q2 2020 set record highs. Both quarters ranked as 2 of the top 3 fundraising quarters for European Digital Health funding ($2.3B and $2.2B, respectively) in recent memory.
And of the past decade’s 22 publicly-known Digital Health European exits, six happened in 2020 (as of November 2020).
2)The region with the biggest step-change in the startup ecosystem? Scandinavia.
— Philippe Collombel, general partner of global venture fund Partech
London, Paris, and Berlin have been top mainstays in the European ecosystem for years, and Berlin really took a leap in attracting investor funding in 2019. The city looked to have cemented its position in the top three. But a surging Berlin ecosystem actually took 4th place behind Stockholm in 2020 (at least by measures of invested capital). Stockholm finished in the top three for the first time in recent memory, per Atomico’s 2020 State of European Tech report.
The Scandinavian ecosystem encompasses far more than Sweden’s capital. But the city’s strong capital formation and entrepreneurial abilities are indicators of the region impressively punching above its weight.
3)The year of the impact startup
— Travis Todd, co-founder and Chief Executive of Berlin startup community, Silicon Allee
By a number of measures, the topics of Climate Tech / Greentech walked closer to center stage in 2020. What did this look like? Well, we saw market maps (Creandum, Tech Founders, even accelerator “maps”), industry reports (PWC, UBS, Tech Nation), new funds (Pale Blue Dot, Dutch Sovereign Wealth (lots of it), goal setting (Balderton), LP requirements (Atomico), and famous tweets.
PWC reported an aggregate of $60 billion in global venture capital plowed into the Climate Tech space from 2013 to 2019 — about $15 billion of which happened in 2019. Leading indicators for 2020 numbers and beyond look quite promising. Let’s hope the increasing attention on these topics lives up to this promise. And though environmental sustainability sits within a subcategory of impact tech, we can’t wait to see even broader themes of impact innovation rise in prominence too.
4)The year of remote working
— Nicolas Colin, The Family
Here’s the one you’ve been waiting for. Did Nicolas predict COVID-19 and its impact? Probably not. But his sentiment on distributed work technologies (Zoom, Slack, Figma and others) being ready for “primetime” was a prediction many of us watched come to life. What a year for remote to pull ahead as THE defining work habit in tech. And full-remote or hybrid environments look likely to stay.
More food for thought: Nicolas cautioned that Silicon Valley might leverage the advent of remote work to their advantage, hiring top European talent into American companies.
With that in mind, data shows that hard to fill job postings became…well, less hard to fill. But interestingly, two major European hubs, UK and France, showed serious reductions in the share of hard-to-fill job postings relative to the US. So, there’s at least one indication that major European tech ecosystems were perhaps able to grab talent at a better rate through COVID-19 than the US.
5)The year US venture money pours into Europe
— Hussein Kanji, partner at Hoxton Ventures
Indeed, the Americans have come. Investment from across the Atlantic has taken shape with new firms getting involved. “A record number of American institutions, more than 550, participated in at least one investment round in Europe in 2020, an increase of 36% since 2016.”
Additionally, founders of all levels of experience felt the presence of investors from the States. The majority agreed with the statement that “US VCs seem to be more active in Europe” in the past 12 months.
Where are we going in 2021?
We enter 2021 with our eyes wide open, knowing that the unexpected is expected. If you enjoyed this article, follow our Speedinvest Blog or find me on Twitter here. My DM’s are open for your thoughts on the future and especially if you’re building tech to help shape it.
