4YFN 2024 wrap-up

2024 was the 10th year of 4YFN in Barcelona. Over that time, the event has benefited from being alongside, then incorporated into the Mobile World Congress, which had 93k people attend this year. That is almost 5k more than last year's MWC attendance, but still below the high of 109k people in 2019.

Remember, 4 years ago, it was 2020, and the event was cancelled due to the pandemic. Things have changed a lot since then.

Here are the trends I saw from the 2024 4YFN in Barcelona. To check out my 2023 4YFN review, click here.

AI is no longer just a trend. It is here to stay

“AI is a tsunami” ( Jordi Romero CEO & founder of Factorial and Partner of Itnig).

AI, especially Generative AI, is still a big talking point, but much of the glitz and glamour of last year’s conference has gone, leaving behind the tough business reality.?

“You can’t just sprinkle AI and make everything work”. ( Alistair Fulton , COO & VP of Ecosystem Blues )

Without the hype, the tough reality of what it takes to make an AI business has become apparent. It is resource intensive, so big money is needed to get it up and running. Luckily there is still big money interested in AI. Nvidia’s stock price is booming. But it is not a simple landscape. The big money needed and limited realistic opportunities means not everyone can be a direct player.

What was clear was it is not just the big corporates who can build AI. Sara Bisbe López , Chief AI tech officer at AILY LABS was a great example of how it can be done from scratch.

With an eye to the future, the benefits of AI are starting to become apparent. There were claims that productivity could jump by as much as x4, with national GPDs increasing 5%-7% just from AI. That would mean companies will need fewer people, but those who stay could demand higher salaries.

But what it will take to get there will be tough.

AI has a bumpy road ahead and there will be tough consequences

With the glitz and glamour gone, the world must deal with the hard reality of AI’s new potential as well as the headaches it can cause.

The PR headaches of AI hallucinations, misdirection and derailments are bringing to the surface the many issues AI faces. Data, especially training data, is a sleeping giant. Personal data is set to be a battleground as "GDPR is under threat" ( Marie Austenaa , Head of Digital Identity at Visa ).?Just recently, Google’s Gemini has been making headlines for all the wrong reasons as they tried to eliminate racial bias. B2B AI companies are better at hiding their problems, but B2C makes the many issues facing the industry very clear.

It is not surprising that many people now fear for their jobs. AI is coming for white-collar jobs. I heard some estimates that AI could disrupt 1 billion white-collar jobs globally.?

Many speakers did not shy away from the need for proactive regulation. There was a consensus that any regulation couldn't be reactive due to the speed at which AI moves. Remember, 70% of Americans can’t spot a deep fake. In an election year, that is dangerous.

It is only a matter of time before more bad news hits the headlines. But it is unlikely to derail the juggernaut of AI.?

Outside of AI, it is a tough, but pragmatic market.

If you are outside of direct AI model creation, it is a very different market (note: those simply training someone else's model are in the outside category here). Gone are the days of “free money”. It is not a bear market, but not a bull market either. The USA appears to be heading for the mythical soft landing, preventing recession there. The economy is good, but there are plenty of things to worry about.

For the world of startups and scale-ups, what was clear from 4YFN is that the market is forcing a return to core principles. The road to profitability and a sound business model have become a big concern. Businesses have to prove their value, rather than tell a story of their potential. Business models are being securitized, and those trying to do something outside the norm are finding it a lonely road, with investors showing little interest. Fritz Oidtmann , Managing Partner from Acton Capital gave some great insights on business models.

This landscape makes the startup space both simple and complicated, making it a challenge to navigate. In the last year, Europe has seen fewer new entrepreneurs than in previous years, therefore the new startup growth is being driven by returning founders. The problem: There are only so many previously successful founders/ super high-potential teams to go around.

VCs are adjusting, but also being smarter and more careful. This is leading to an interesting market situation where there is a growing gap in VC funding haves vs have-nots.

AI disrupted the VC industry, but now the VC is adjusting.

The past may offer an insight into AI’s future: The complexity and interdependency of tech

Not using AI has become a red flag these days. VCs are using AI to analyze the market, and when to divest.

What is clear from a business side is AI is making the complexity of doing business more apparent. Big players are showing that they can’t do it alone. Building end-to-end services is no longer realistic, instead, you must pick your place.

Looking at past trends, we can see some potential futures for AI. I attended the IoT Stars event on Monday (thanks Marc Pous for organising) and it offered some interesting insights that could give us a glimpse of the future of AI.

IoT went through a boom a few years ago, with everyone trying to build their own branded platform and control the end-to-end experience, hoping startups and smaller players would fill in the gaps in an app-store-style ecosystem. It didn’t work.

What has happened is the evolution of “Many secure silos” ( Kenta Yasukawa , Cofounder & CTO at SORACOM ).

It looks like the major players of AI have learnt from the journey of IoT. Many partners will need to work together to ensure AI reaches its full potential.

The challenge will therefore be the silo mentality. Regulation as well as industry agreements, conventions and standards can help elevate some of the potential issues.

Mid-sized companies will drive a lot of the market, and AI will need to rely on these companies to do a lot of the heavy lifting. This is good news for the startup ecosystem.

I spoke with Daniel Quant from MultiTech who offered an interesting example of Uber vs “the knowledge”. To become a London Black Cab driver, you must pass a test called “the knowledge”. It requires 2-3 years of training and you must learn every single street and landmark within a 6-mile radius of Charing Cross. No location tech is allowed to be used by a Black Cab driver. On the other side of the equation is Uber. All that you need to become an Uber driver in London is a driver's license, a car and a short 30-minute course from Uber. ?Uber's software takes care of the rest. Bear in mind that Uber is one of the world's largest consumers of Map data. Ed Freyfogle demonstrated how difficult location and map data can be, and how many end users take it for granted these days.

Any tech startup relies heavily on APIs and plugins from existing companies and the ecosystem. How everyone works together is important, and AI is going to be no different.

The Barcelona startup eco-system is evolving

The home city of 4YFN was out in full force this year, with its voice being louder and prouder than ever before. It is an interesting story that also says a lot about the startup ecosystem in Europe as a whole.

The local ecosystem has been growing to become one of the core startup locations in Europe. It still trails London and Berlin, but there is still plenty of room to grow. A few big success stories have helped too. The old guard of Pravalia has been upstaged by TravelPerk , Factorial and Glovo . The founders of these newer arrivals, Avi Meir (TravelPerk), Jordi and Bernat (Fatorial) and Oscar Pierre (Glovo) have not been quiet either. Regular speaking events as well as making many angel investments have helped push the eco-system. Repeat founders from all over Europe are also choosing Barcelona for their next startup.

Non-Spanish VCs are starting to take notice, setting up local offices to not only close deals but support their portfolio investments.

But as you may expect, there are still challenges that remain. The financial scene still needs more development. There are no “Super VCs” based in Spain, meaning any post-Series A round needs non-local investment. Traditional Spanish VCs, who are used to having a privileged seat at the table are adapting, are potentially not adjusting fast enough. Investors agree there are plenty of opportunities, but the financial ecosystem will take more time to mature, although it may never reach the heights of the UK or USA.

The startup and scaleup entrepreneur community is growing too, but outside of big, international drawcards such as Founder to Founder , smaller entrepreneurial communities often struggle to attract critical mass numbers, causing them to fail.

Spain, including Barcelona, remains a lower cost-of-living and cost-of-salary compared to northern Europe, allowing startups to operate with lower costs. Scale-ups are realising that too.

Accelerators and coworking spaces are plentiful, but the low-cost nature of Spain causes a duality that can be tough to reconcile for coworking companies.

One of the most interesting comments came from Bernat Farrero (Founder/CEO Factorial & Founder of Itnig), who said "There are not enough forever founders”, who stay with a company rather than exit. Factorial's founders both show no signs of exiting just yet. Itnig - Startup Ecosystem is building a great support system, with deep roots in early-stage local startups.

I can only hope the local ecosystem continues its growth. Success brings more success. A rising tide floats all boats.

4YFN continues to become more diverse

One of my favourite things about 4YFN is the large diversity of the event. People from all over Europe, Asia and North America have long been the coming, but African companies have been making a bigger presence over the last few years, and this year I noticed a much larger presence from Middle Eastern companies and countries.

Since my first event back in 2017, I have always been impressed by the strong community of voices of female founders, tech professionals/enthusiasts and VCs. This year I found their voice as loud and proud as ever. A big shout-out to my contacts at 普华永道 for inviting me along to watch the "Women Leaders in Telecommunication at the Peak of Global Economic and Societal Change".

Green-tech is joining health-tech as a regular theme at 4YFN with a long outlook

Health-tech has long been a core theme at 4YFN and the time and resources required by the industry demonstrate the embrace of the “4 years from now” ethos. How health-tech companies leverage AI was a popular theme in the discussions. Again, it was grounded in reality, rather than hype.

This year I started to get that same vibe from green-tech. The theme has been growing in recent years, and this year it was buoyed by the news that 2023 was the hottest year on record. A strong showing of startups, talks and stands meant it was a topic that could not be ignored.

I expect to see plenty from both topics again next year.

Conclusions: 10 years of 4YFN

10 years of 4YFN in Barcelona has seen lots of change. AI has been a big topic, and it looks like we will be talking about AI for years to come.

The full impact will be felt for years to come, and each year of 4YFN will explore the different stages of evolution.

If there is one clear lesson from 4YFN 2024 it is: Those who have embraced AI are already pulling ahead. It is only a matter of time before the gap becomes too big for those who are left behind to catch up.