Venture capital is one of the essential pillars of modern industry; it, so to speak, makes the professional world go round. In brief, venture capitalism describes the early investment into promising start-ups by individual investors, where rapid company growth pays monumental dividends via rising company value and share price.
Venture capital is a high-risk endeavour with many moving parts, but also one that has made some of the Western world’s most prolific billionaires – and today, it is more accessible than ever. Retail investment vehicles enable those with little monetary resources to engage with growing businesses via crowd-capital funding, while newer entrepreneurs have more tools than ever to reinvest earnings into young businesses. What are the trends for 2024, that venture capitalists are likely to be sniffing out?
One of the bigger trends to emerge in recent months relates to the growing urgency of the global climate crisis. Several points of no return have already been crossed regarding carbon emissions figures and ocean temperatures, making green initiatives all the more important. With public opinion matching the science, demand for sustainable solutions – and, by extension, sustainable businesses – is high.
As such, sustainability-aligned businesses are hot property and are rewarded with swift growth. Whether firms working in green energy, or new start-ups with a sustainability focus, there is rapid financial growth to be found in green sectors – and several platforms from which sustainable start-ups can be seeded.
This trend is not quite ‘new’ anymore but remains a prescient consideration for venture capitalists in the coming years. The coronavirus pandemic saw a large majority of the West’s workforce sent home until further notice, necessitating swift adoption of remote work and collaboration technology – in turn, generating a great deal of demand for innovation and iteration in this specific corner of the tech industry.
Even with the pandemic lockdowns a more-or-less distant memory, demand for remote working equipment and software has remained remarkably high. Shifting attitudes and relationships to in-office work is pointing towards a future of hybrid, modular, and remote working as standard, making an early investment in businesses surrounding this niche a shrewd move. Ancillary considerations such as peer-to-peer encryption and third-party data handling are also fertile ground for venture capital.
Bio-Tech and Life Sciences
The tech industry is an ever-growing organism, but some aspects are expected to grow all the quicker. The rapid onset of the coronavirus pandemic was also something of a wake-up call for global health, with research organisations and laboratory teams kicked into overdrive to fast-track a vaccine.
The pandemic illustrated well the sheer value of medical research and biotech endeavour, with medical supply firms and research organisations alike experiencing heightened venture capital engagement. Meanwhile, controversial developments in neural interfaces are quietly heralding a very different biotech revolution, with all the legal and ethical issues that follow. Whichever side of the debate, there is financial promise for early investors.