10 markets ready for your startup in 2020.
Startups might be small, but their impact can be big. They’re lean, agile, innovative, passionate and disruptive, and trends that begin as the brainchildren of startups often cascade into society both at a local and international scale. But in a world of lightning-fast change and with thousands of new businesses born every day, it’s difficult to pinpoint the markets that are primed to enter and make a startup successful. So, we’ve compiled a list of ten markets we think are ready for a startup and set for enormous growth in 2020 and beyond.
We live in the time of personalization; from watching, listening and buying to investing, wearing and traveling, we’re obsessed with having experiences customized for ourselves. Nutrition is no different. Personalized nutrition is booming, and with some estimates of the market reaching $50 billion by 2025, big companies have started to take notice; Nestlé acquired the customized vitamin subscription startup Persona earlier this year and Mars recently acquired targeted nutrition company foodspring. If you combine this move towards a tailored world with other factors driving the personalized nutrition market such as increasing demand for healthier foods, interest in personalized medicine and the modern-day desire for self-improvement, it’s a market that will be welcoming startups to join the growth.
Back in October, electric scooter startup Bird announced a newly acquired $275 million dollars in funding, bringing their valuation up to $2.5 billion dollars. Bird was founded in 2017. Whilst scooters themselves do come with their inherent problems, theft and vandalism being two main concerns, in reality they’re one amongst many types of transport entering the market. Both the economic and environmental benefits of sharing transport for the individual are clear, but if looked at from a wider demographic perspective, the world’s urban population is expected to nearly double by 2050. Alongside the future of self-driving modes of transport, the shared mobility market holds immense potential for startups.
Automation, personalization and the increasing demand for cloud-based services are amongst the drivers of the Artificial Intelligence market’s impressive growth (CAGR of 55.6% between 2016 and 2025). It is, however, not without its pitfalls, as the costs associated with setting up and running a genuine AI (AI being a term that is often used in an exceptionally vague manner) operation is something harder said than done for a startup. But, of course, there are startups showing us that success is being achieved. Amsterdam local Aidence uses AI to aid in early recognition of lung cancer and raised €10 million in Series A funding, Cinnamon is replacing countless mundane document-based tasks that humans usually do ($15 million in Series B funding) and People.ai, who uses data to improve and guide performance of sales teams, raised $60 million in Series C funding.
It’s unsurprising that sustainability is on the list as each year becomes a clearer reflection of our devastating effects on the Earth. Urgency around the issue has prompted a torrent of businesses to tackle a truly worldwide problem, from plant-based meat substitute giants such as Beyond Meat and Impossible Foods (both looking to take on the intimidating Chinese market) to The Ocean Cleanup who are aiming to clean up 90% of the world’s oceans. Despite well-known organizations leading the charge, sustainability is ripe for startups to contribute to the growing mission. Hrbs., a circular culinary herbs delivery service, and Holie Foods, a plant-based food startup, (both members of B. amsterdam) are two examples of startups operating on a more local level, a level where change starts. And outside of the B. community, startups such as urban growers Bowery Farming, food-sharing Olio and Bill Gates backed solar fuel Heliogen are demonstrating that good for the planet can be good for business.
Many people still just think of gaming when they hear virtual reality, and whilst the gaming industry is closely tied to the technology, it’s potential today reaches much further. Education, medical training, treatment of mental illnesses, sport, real estate, military training and even recruitment to name a few. And as the technology advances at a frantic pace, virtual reality use cases only grow. One startup showing the world what virtual reality can do is Varjo, founded in 2016, who create human-eye resolution products for a range of professional industries, and they raised $31 million in their Series B funding. If their products live up to their claims, the implications are revolutionary. And as an extra incentive, the market is meant to hit $120.6 billion by 2026.
One study concluded that the US CBD market could punch through $20 billion of sales by 2024; that’s just CBD in one country. The entire legal cannabis market is on target to touch $66.3 billion in 2025. Some investors do remain skeptical of the cloudy regulations surrounding cannabis, but that doesn’t seem to be stopping an array of successful startups. Take 2018 founded Daye for instance, a London based CBD infused, pain-relieving tampon startup that prides itself in self-care and planet-care who, at the start of this year, raised $5.5 million in funding. Or 1906, innovative leaders of cannabis edibles who recently closed an $18 million round of funding after starting in 2016. It’s a big market that’s seen its fair share of ups and downs, but with increasing acceptance and knowledge of both CBD and THC, we think the future for startups here is bright.
Whilst blockchain does face a host of challenges; political, behavioral and structural, not to mention businesses needing to shift away from the traditional monopoly creation mindset, its global market is expected to have a CAGR growth rate of 68.1% between 2019 and 2027. It’s hard to ignore anymore, change is coming and startups know it. Bitcliq is the world’s first fish trading platform using blockchain, Indonesian startup HARA is using blockchain to help small farmers access beneficial data, Provenance is bringing transparency, sustainability and accountability to supply chains and Goin is encouraging millennials to save and invest. Blockchain really is a world of possibilities, and the applications for it are only growing.
People are gaining a more holistic view of their health as more and more research is released on the consequences of lengthy, stressful schedules, toxic work cultures, and neglected office conditions. And to add to this, depression, anxiety and a long list of chronic work-related conditions are on a sharp rise. Companies are now seeing corporate wellness not only as a way to increase productivity, retain talent and boost innovation but as fundamental to being a good employer. Startups such as Spill, who are revolutionizing message-based therapy, picked up £650,000 in seed investment earlier in 2019, and the workplace mental health platform Unmind received £3 million in new funding this year. It’s a market that’s predicted to reach $90.7 billion in 2026, so perhaps now is a good time to get thinking.
Dubai recently claimed the world’s largest 3D printed building, which is also the world’s first two-story 3D printed building. Admittedly, it’s an industry that has been engulfed in the hype, and alongside a lack of legal premises, it’s not without its risks. But it’s the possibilities of 3D printing that make it remain an enticing space for startups; Haus.me are enabling 3D printed, off-grid homes, MX3D printed a stainless steel bridge across one of Amsterdam’s oldest canals and Desktop Metal (a leader of the industry who since being founded in 2015 have raised $438 million in venture funding) have just created an office-friendly 3D printing machine. Some think 3D printing has had its time, but the move to automation is inevitable, and with it, a reliance on such technologies means it’s hard to imagine a future without more 3D printing.
It’s hard to tell if the label ‘Femtech’ has hindered the market’s growth, but it hasn’t seemed to affect investments in recent years, and Venture Capital investment is rising each year and is set to reach $1.3 billion in 2020. Startups such as smart technology Elvie, sexual wellness app Ferly, or hormone tracking disrupters Inne have seen the potential for health and technology to come together and provide solutions to problems that are faced by many. It might seem niche at first, but in reality, approximately 50% of the world’s population is female; that’s a big space for startups. With the overall market estimated to explode to a value of $50 billion in 2025, Femtech is definitely one to watch.