As we head into 2022, it is clear that the technology industry is booming, and venture capital investment is at an all-time high…but can it continue? In 2021 the venture capital industry saw record-high valuations for startups, particularly in hot areas like Web3, AI and FinTech. If you are an entrepreneur looking for funding, it is important to focus on categories with robust growth potential that investors will continue to be interested in should the market slow down and valuations trend lower. In this blog post, we discuss the top five categories that we believe will be the most promising for venture capital investment in 2022.
Web3
With the rise of blockchain and cryptocurrency, Web3 is poised to continue disrupting traditional web applications and services.
But what is Web3?
Web3 is a decentralized internet powered by blockchain technology. It is the next iteration of the internet and is designed to be more transparent, secure, and user centric. It is believed that Web3 will be an essential category for entrepreneurs looking for venture capital investment in 2022 because it is the future of the internet. By building on Web3, entrepreneurs can create new types of decentralized applications and services that are more in line with the future of transaction (transparency, security, and user friendly). Some of the areas that entrepreneurs can focus on include NFTs, decentralized finance (DeFi), and decentralized social networks. Because the timing of Web3 crossing the chasm is unknown, the biggest winner in this category over the next 5 years will be the entrepreneurs and investors who bet on selling the picks and shovels – the actual infrastructure of web3, not the out-front consumer brands.
For more information on Web3, check out this opinion article from CoinDesk and this article from CoinTelegraph
Sportstech
The sports industry continues to be ripe for disruption, and in 2022 we can expect to see a wave of startups focused on sportstech due to the increasing demand for digital experiences and remote engagement. The industry has been undergoing significant changes in recent years, with the pandemic accelerating the need for innovative solutions. This includes everything from wearable devices that track athlete performance to new platforms for sports betting. Another factor contributing to the industry’s growth is the increasing focus on data analytics and sports performance. With the rise of wearable technology and advanced analytics tools, coaches, athletes, and sports teams are now able to gather and analyze vast amounts of data to improve their performance and gain a competitive edge. This trend is set to continue, with even more advanced technologies and tools expected to be developed and adopted across the industry
With the increasing popularity of e-sports and the rise of mobile technology, there is a huge opportunity for entrepreneurs to create new products and services that appeal to sports fans. Venture capital firms are already investing in this space, and we can expect to see more funding flowing into sports tech startups in 2022.
For more information on sportstech, check out this article by SportTechie:
Embedded fintech
While fintech has been a popular category for years, embedded fintech takes it to the next level by integrating financial services into other products or services. This can include everything from banking services built into a shopping app to insurance options offered through a ride-sharing service. Embedded fintech has the potential to transform many industries and is attracting significant investment.
We predict that embedded fintech will be an important category for entrepreneurs looking for venture capital investment in 2022 because it’s set to disrupt the traditional banking industry. By integrating financial services into non-financial products and services, entrepreneurs can create new types of financial products and services that are more accessible, convenient, and personalized. Some of the areas that entrepreneurs can focus on include mobile payments, micro-investing, and digital wallets.
For more information on embedded fintech, check out these articles:
Artificial Intelligence
Artificial Intelligence is a technology that has been around for a while, but it is still an essential category for entrepreneurs looking for venture capital investment in 2022. AI technology is being used in various industries, including healthcare, finance, and transportation, to automate processes, improve decision-making, and enhance customer experiences. By leveraging AI, entrepreneurs can create new products and services that are more efficient, intelligent, and personalized. Some of the areas that entrepreneurs can focus on include chatbots, predictive analytics, and natural language processing. For more information on artificial intelligence, check out these articles:
Robotics
Robotics is an area that we believe will continue to see growth in 2022. As automation becomes more prevalent in various industries, including manufacturing and logistics, robotics will play a crucial role in improving efficiency and reducing costs. With advances in artificial intelligence and machine learning, we can expect to see robots becoming more intelligent and more capable. This has led to an expansion of the potential applications for robotics, from manufacturing and logistics to healthcare and agriculture. Additionally, the pandemic has accelerated the need for robotics in healthcare and other industries, creating investment opportunities for venture capitalists.
For more information on the state of investment in the robotics category, check out this report: The Robots Investment Report
The Wrap Up
While these categories offer opportunities for entrepreneurs, it is important to note that the current high valuations in the technology industry may not be sustainable. Venture capital investors may be worried about a technology valuation bubble bursting, which could lead to lower valuations for startups and less upside for entrepreneurs. It is also important to focus on building sustainable businesses with strong fundamentals, rather than solely relying on a high valuation. In the long run, a healthy and stable startup ecosystem benefits everyone involved.