2023 Startup industry predictions

What were general trends this time last year?

The end of 2021 saw a record-breaking year for European venture capitalists with over €100bn in investment. There were hopes the year that followed would mimic this growth with the supposed abundance of unicorn startups and increased investment opportunities. The second half of 2022 clearly indicated this would not be the case, as we entered 2023 with record-breaking inflation rates in the United Kingdom and a looming recessions on the horizon. Surprisingly however, while 2022 took a significant economic downturn, investment has still been higher than both 2019 and 2020.?

The downturn, while obviously putting a dent in the startup community, did however provide clarity and focus for driven entrepreneurs looking to solve pressing issues in industries such as SaaS, climate tech, and pharmaceuticals.?

So what happened? The global sociopolitical climate and events of 2022 resulted in rising inflation rates, a looming recession, and the cost of living rising in the UK. Thus, investment slowed and several businesses struggled to secure funding in the final months of the year. Tech experienced quite a few unexpected bumps in the road with the explosion of ChatGPT, Elon Musk’s short-lived Reign of Terror at Twitter, and the collapse of crypto markets – all of which unsettled the general startup ecosystem in 2022.??

Not all is lost, however, for startups looking to secure funding in 2023. We took a look at some upcoming predicted trends for startups in the next year.

Sustainability / Climate Tech?

Within the past decade, the very real effects of climate change have inspired a strong wave of entrepreneurs looking for creative solutions for sustainability. This strong wave however has proven inconsistent over the years, failing to make much concrete impact, until now. 2023 is predicted to be populated by a surge of Climate or Clean Tech as founders will seek sustainable solutions for producing and consuming energy.?

Amidst the gloom of the economic downturn, Climate Tech is predicted to continue at a steady pace throughout 2023 due to the pressing inevitable impacts of climate change. These aren’t just startups associated with limiting carbon emissions, but hybrid tech, sustainable eating, and optimizing energy sources and usages.?

Ai

With the explosion of ChatGPT towards the end of 2022, there’s no surprise that 2023 is predicted to be huge for Ai. With its seemingly unlimited potential there will be a focus on using Ai as an add-on tool, rather a replacement for people or unethical shortcuts. While some experts are claiming that Ai will soon be a tool for entrepreneurs to predict market and customer demand trends, others say it is still in its early stages of development. This will be rather a year of experimentation and specification, since Ai models’ accuracy and transparency is paramount before widespread usage.?

Ai has the potential to be used across all industries, as long as it is properly understood. The more we learn about its abilities, the more businesses can adapt its usages for innovative solutions.?

Health Tech

In a post Covid-19 world, Health Tech still stands as a powerful player in the startup ecosystem. Experimentation with new digital technologies have revolutionized healthcare; both in organizational workflows and in receiving the care they need which opens up availability amongst staffing crises and other factors that have traditionally kept those from getting the care they need.?

2023 will see a continuation of digitising necessary healthcare services ranging from women’s health to mental health services & counselling. This is an excellent example of founders looking to solve a longstanding problem through a unique and innovative product that is so necessary, the startup should have the ability to survive regardless of the investment landscape.?

So what now?

As much as we wish we could accurately predict the future, 2022 definitely showed us how much change can occur within a year. The socio-economical landscape is constantly changing, which definitely adds uncertainty for businesses. Still, uncertainty and hardships pave the way for the entrepreneurial spirit to come up with innovative solutions and technologies such as the aforementioned industries that investors will supply funding for.?