Startups Offer A Unique Glimpse Of The Year To Come
Our industry never runs short of would-be prognosticators. Around this time of year, those of us interested in the future of technology find ourselves awash in predictions from analysts, journalists, big-tech executives and the like. While these people are all informed by unique perspectives, one thing I’ve seen in leading Oracle for Startups and Oracle for Research is that agile, curious innovators often have their ears closest to the ground. For startups, the ability to adapt fast, seize upon the latest developments, and see what’s coming from around the corner can make the difference between success and failure. So, based on what I’ve learned from the innovative startups and researchers Oracle is supporting, here are some trends I expect to take off in 2022.
Industry clouds are the next big thing (and startups should care): As Cloud Wars’ Bob Evans said: “I’ve never seen the entire tech industry coalesce as aggressively and as rapidly around a single trend as what’s happening now with industry clouds.” These clouds offering processes and tools catering to the needs of specific industries are about to make big waves, and startups, especially SaaS players, are looking to ride them by collaborating and co-innovating with cloud providers like Oracle. That will drive stronger solutions and increased revenue opportunities. Startups are already building tailor-made cloud products for specific industries like healthcare and financial services, and I bet more will jump on this trend.
Blockchain will mend the supply chains Covid broke: Blockchain is more than a platform for cryptocurrencies. The technology’s ability to enable smart contracts, tracking and traceability is poised to transform supply chains, boosting their transparency and efficiency. The change started with regulations and shifting consumer demands predating Covid, but the pandemic, in highlighting supply chain bottlenecks and glitches, has accelerated blockchain adoption to tackle this use case. As such, a number of startups we work with, including retraced — a transparency and sustainability platform for the fashion industry — have reported fast growth. Look for new applications that massively innovate supply chain operations, with startups leading the way.
Multicloud becomes the standard: We’re seeing evidence that the private sector’s shift toward multicloud is influencing the public sector. Contrary to some beliefs, startups are also leading the way. I’ve listed this in past predictions, but it’s too important to not reference again. We called this early for startups, back in 2019, and continue to see this grow. According to new IDC research, 86% of startups considered using other cloud providers beyond their primary vendor, and 68% are leveraging a multicloud strategy. Startups and enterprises alike will increasingly take a multicloud approach, to use the best cloud for different workloads, meet customer demands, and remain flexible.
Venture’s disruption will continue: It’s ironic that the industry known for disruption is being disrupted, but non-traditional investors like private equity have moved in and are writing big checks to startups, shaking up the traditional VC model. Sequoia Capital’s recently announced strategy shift to a singular, permanent fund structure shows how much powerhouses like Tiger Global are forcing change. And with the rise of angels to crowdfunding to direct listings to SPACs, the only constant is change. As technology investing goes from the niche asset class of venture to being a good business, we’ll continue to see asset managers come to compete. Venture’s no longer an exclusive club, and disruption will continue.
Rise of super apps: After a decade of unbundling, consumer behavior will revert to re-bundling. Consumers are feeling app fatigue — just look at the number of apps on your phone to see why. I predict a shift to apps that act as one-stop-shops, driven by a desire for convenience and simplicity. First adopted internationally — think WeChat and Paytm — super apps combine functions like social, financial, entertainment, and utility services. One member of our startup program, Minfo, is developing a universal app to help humans engage meaningfully with everything from radio ads to elevator buttons in smart cities of the future. Startups and organizations would be wise to consider their business in a ‘super app’ world.
Latam becomes the next top startup ecosystem: The Latam region has seen record-setting years in 2021 for venture and private equity funding. While the region is still behind others in volume, I predict it will grow the fastest over the next two years, with innovation driven by necessity and social trends. The reasons are compelling, with more than 600 million consumers (215 million in Brazil) who are digital-first citizens, and mobile usage skyrocketing. For example, the population is underserved by banking, leading to fintech growth. While Brazil’s economy is unpredictable and at the mercy of macro-fluctuations, I believe in this region’s potential, and Oracle is backing it with resources to help this hotspot continue its growth.
Democratization of high-performance compute for startups: Once reserved for research institutes and large enterprises, cloud has unlocked the power of HPC for startups. Our recent partnership with Altair is a great example of putting enterprise-grade HPC in the hands of startups. Expanding beyond the traditional definitions of HPC, environments that deal with massive amounts of data needing immense computational power require a high-performance cloud. Take, for instance, training large language models such as GPT-3. Aleph Alpha is training a 13 billion parameter AI model on Oracle Cloud using Nvidia’s most powerful GPUs connected by high-speed networking. Look for advancements in high performance computing to push AI capabilities and open possibilities for a vast array of applications and industries.
Tech for good is a growing force: Social responsibility is a big topic these days, and we should all celebrate that it is. Whether it’s sustainability, food security or mental health, tech is increasingly being directed toward driving positive change in our world, and startups are leading this charge. For example, Circulor is using blockchain to make raw materials more ethical, Tracifier is on a mission to reduce food waste, and startups such as Skin Analytics and Aindra Systems are using tech for quicker medical diagnoses. It’s particularly encouraging to see climate-tech startups attracting record levels of funding; $32 billion so far this year. It’s no longer enough to offer a great product; the public expects startups and corporations alike to make a positive difference, and companies that do this well will be more successful in attracting investment. We expect this trend that’s good for business and humanity to continue into 2022 and well beyond.
Gen Z will be taken seriously: Gen Zers are digitally native and unlike any entrepreneurs we’ve seen before, not least because they prioritize making a difference over making dollars, using tech as a tool for social good. We’ve had the privilege to work more closely with Gen Z in 2021. I believe this generation will have a massive impact — leveraging cloud all the way — to transform what “business” looks like — from individual content creators to social justice advocates, while rethinking banking through neobanks. For sure, this generation has bold and dreamy ideas. But they are also rooted in business fundamentals, and I’m excited to support them.
One-stop-shopping for startups: According to new IDC research, startups value partners that provide a one-stop-shop experience. IDC authors and research directors Simone deBruin and Stuart Wilson write: “It is the extensive range of benefits and value-adds on offer that attracts startups to corporate programs of technology vendors. Not only do they provide technology support, but they also provide benefits in aligned business areas such as marketing, market access, business knowledge, and expertise.” That’s been our program’s ethos since we launched. And while many startups self-serve their way through our program, a growing number want more hands-on support and resources. Startups will look for more comprehensive offerings from corporates and VCs, and organizations would be wise to provide.
If there’s anything we’ve learned over the last couple years, it’s that predictions can be entirely upended by global events. The technology industry is unique in its need to react to rapidly shifting real-world demands of businesses. For that reason, events beyond our industry have a way of changing the course of our industry and changing it fast. The crystal ball will always be a bit fuzzy, but if I had to put money on where things are going, I’d carefully assess the startup landscape before placing that bet.
