Venture Capital: 9 Forecasts for 2019
1. Fintech will continue to grow at a rapid pace this year and I anticipate more of a focus around API driven tech solutions. The flexibility and adaptability of tech across various markets will be important.
2. Data is going to continue to be at the crossroads of all decisions for early stage investors. Startups that have the ability to take to market data-driven solutions and execute the smartest, will be some of the early big winners.
3. Digitalizing the health care industry is becoming front of mind for everyone. As the industry catches up with technology, there exists plenty of opportunity for startups to bridge the divide.
4. We will see growth in the insuretech space and specifically lifestyle tech solutions that are more consumer-centric. It’s a hungry space for the large insurers so I’d expect increased corporate venturing from some of the bigger players.
5. We’ve seen the introduction of a few corporate venture arms recently in South Africa, and I expect this to continue to grow as Venture Capital (VC) becomes more mainstream among corporate South Africa. But don’t hold your breath just yet on some of the pensions funds. The reality is that we need to see some early wins for the VC market, and by that I mean proper exits for investors, before the institutional investors will be interested. Having said that, there are a few institutional type investors with a keen appetite for VC.
6. The SA SME Fund, under their new leadership, is going to make some good headway this year in getting behind venture firms and backing the SME ecosystem. Early worries were that this was going to be a new beat to the same old private equity tune, but the new CEO has made it clear what he’s backing. And that’s good news for VC and the SME market.
7. A common theme gaining momentum is the generation of smart cities and the connectivity of IoT (Internet of Things) devices. But will this really light up? It will be up to innovation teams within corporates, or startups backed by deep pocket investors, that are prepared to weather the long lead cycles required to penetrate the market. Or perhaps these startups are best suited to other regions where there is a more open market, and where the best product at the best price wins the bid?
8. Crypto had a tumultuous 2018 and many are questioning the sustainability of this asset class. While there have been some big losses I don’t believe crypto will disappear. Crypto will find a home as soon as there are more valid use cases that support wide-scale circulation. I believe we’ll find that in other use cases for blockchain, and when we do it will be like the re-invention of the Internet.
9. The startup ecosystem isn’t built on one subset of stakeholder. From startups to accelerators, Angels and VC’s, corporate and institutional investors, each has its role to play in scaling the startup ecosystem. I foresee greater collaboration this year, across the board, and an increasing number of syndicated co-investors to support the scaling of startups.