The Types of Startups That Are Thriving Right Now
Niche startups are finding themselves in the best position to take advantage of an economy turned upside-down.
No-one is “winning” during this pandemic. As the volume of cases worldwide grows to more than 3.5 million and the number of deaths approaches 300,000, our lives have been cruelly turned upside-down. Making matters worse, until we arrive upon a vaccine, we are hurtling towards economic catastrophe.
The economic flow-on effects to startups and small businesses have been immense. Many businesses have seen trade collapse and see little hope of a long-term future. Unemployment has skyrocketed. Consumer confidence has crashed to an all-time low.
Yet out of this chaos, some startups have witnessed unprecedented spikes in demand as previously niche industries find themselves in an unexpected boomtime. Below are four of those startup sectors that are actively thriving right now:
Alternative Cleaning Solutions
Not only are we washing our hands more, but we are also giving greater thought to wiping down all manner of surfaces and devices, particularly mobile phones.
UV light has been known to inhibit bacterial growth for nearly 150 years. Yet technology has only recently made material strides in exploiting the potential cleaning functions of UV light. For a select few companies at the forefront of R&D in this field, the pandemic has seen demand for their products soar.
Taylor Mann, CEO of CleanSlateUV, a startup that manufactures products to clean hospital equipment and other electronic devices with UV light, reported to TechCrunch that while “mobile device hygiene was a major and fast-growing concern even before coronavirus came on the scene,” coronavirus has “only added fuel to the fire”, spurring growth in the industry significantly.
In a similar vein, PhoneSoap, a Utah-based company specializing in mobile phone cleaning, has seen revenues increase more than 1,000% year-on-year. Demand for PhoneSoap’s products has been so high in fact, that the company sold out of most of its devices in early March, and has had to resort to taking pre-orders which the company hopes to ship by the end of May.
Remote Collaboration
With more employees working from home than ever, and social distancing reducing the number of in-person meetings, the big players in remote collaboration like Zoom, Microsoft Teams, and Slack have all reported huge uptakes in usage (Zoom acquired more users in the first three months of 2020 as in the entirety of 2019).
But it is not only the big players that have seen exponential growth. Many smaller businesses and startups are also reporting significant increases in year-on-year usage.
Hopin, the UK-based live online events platform, is thriving as the pandemic has thrown the immediate future of real-world events into the air. Quick to realize the potential long-term impact of coronavirus on social interactions, Hopin reportedly received $6 million in seed funding in late-February to expedite the platform’s scale-up.
In Finland, the employee communications platform Smarp has more than doubled its inbound pipeline as a direct result of the pandemic. As CEO Roope Heinila told Sifted, “we are seeing a major uplift in demand for our services”, noting that demand is only increasing as the crisis expands.
While in Israeli, the edtech firm Jolt brought forward the launch of its online platform Jolt Live by a full year. Explaining this move, Jolt Roei Deutch, co-founder and CEO, has said that:
“Where many traditional educational institutions are having to consider closing campuses, we have been able to accelerate the launch of virtual sessions…allowing thousands of our students to continue learning without disruption.”
Doctor-On-Demand Apps
It is no surprise that businesses in the telemedicine and doctor-on-demand space are finding themselves in greater demand than ever before.
With GP clinics closing their doors to limit the virus’s spread and hospitals crying out for anything that will help alleviate capacity issues, these platforms are playing a doubly important role.
Kry, the largest doctor app in Europe has reported a 60% increase in app downloads year-on-year and an 80% uplift in the total number of consultations. Currently in talks with a number of U.S. healthcare providers, the company has raised more than $230 million in funding, with CEO Johannes Schildt viewing the pandemic as a “mega shift” that is poised to “drive a lot of value” for his company.
Qare, a direct competitor of Kry, has also noted large increases in pandemic-related demand — on top of existing double-digit month-on-month growth. While Babylon, the leading doctor app in the UK has delivered over 2 million consultations this year.
Trading Platforms
“We’re living through a historic period of time and some people don’t just want to sit on the sidelines.”
As the CEO of the Australian-based trading app Stake noted last month, the volatility unleashed by the pandemic has been a boon to trading platforms as punters try to “buy the dip” and make a quick killing on the stock market. Since Christmas, Stake has seen trading volume quadruple through its app to more than $150 million per month.
Viktor Nebehaj, co-founder and CMO of Freetrade, told Altfi last month that March was an “insanely good” trading period, with a record number of account openings and “almost every day setting a new all-time record over the month.” Amidst such success, Freetrade is now launching its sixth round of crowdfunding, hoping to raise at least $1.2 million in May.
These four types of startups barely scratch the surface of those which are thriving during this pandemic.
While not all might be considered “good”, most have seen their growth stem from one simple truth: they are providing immense value at a time when our lives and livelihoods have been flipped topsy-turvy.
They are a testament to the many entrepreneurs and small business owners who are doing everything they can to help fight this battle.
