Top Industries for Startups

Digitization and automation have impacted every aspect of consumer and business user lives. Almost every company strives to adapt to this new reality, with the world demanding a virtual way of doing simple and sophisticated things. Some still struggle to survive, while others have embraced the latest technologies, such as Blockchain and Artificial Intelligence, relied on custom software development, and made a significant profit in particular niches.

From telemedicine to EdTech-related apps, your startup business can explore different options to get attention from investors, partners, and target audiences. If you are ready to develop the next disruptive solution but need some direction, you can find plenty of opportunities in a few top startup industries. As a bonus, you will also find the technologies with the highest potential for entrepreneurs to explore and capitalize on. Read on to find out which of them are suitable for your case.

List of Startup Industries and Technologies to Watch Out For

EdTech

Since digital technology has changed our learning, EdTech has become one of the best industries to start a business. Online education evolved and experienced a global surge in investment during the frenzy of 2020 to 2022 when many startups reported sky-high investment rounds.

However, venture capital interest in EdTech solutions gradually decreased by the end of 2022 due to evolving market conditions and economic challenges. The collective investment in private US EdTech companies fell from $3.6 billion in the first half of 2022 to $2.2 billion during the same period in 2023, according to Reach Capital, one of the largest EdTech-oriented investors in the world.

We can find evidence that the global VC investment market in other public resources has drastically cooled compared to the previous year. For example, Brighteye Ventures, a venture capital firm with operations in the UK, Luxembourg, and France, has also explored the topic. Their most novel report found that venture capitalists spent $9.1 billion of EdTech funding in 2022 and invested $2.6 billion in the first half of 2023. According to experts, total EdTech VC funding is projected to reach a substantial $5 to $6 billion by the end of 2023.

Another report provided by HolonIQ forecasts global EdTech venture investments to reach only $3.5 billion in 2023. During the second quarter of 2023, EdTech venture investments amounted to $707 million, resulting in a cumulative total of approximately $1.8 billion for the year's first six months.

EdTech funding rounds have experienced a significant decline, ranging from 20% to 40% compared to their levels in 2022. However, the most substantial impact has been on the deal value. Experts predict there will be no emergence of newly established EdTech Unicorns or Mega Rounds (deals worth $100 million or more) shortly.

This is how much capital has been so far raised by different EdTech companies in the world in 2023:

The USA has the highest number of EdTech funding rounds in 2023, showcasing its prominent position as the EdTech industry leader. However, India, China, the UK, and Australia contribute significantly to the global EdTech funding landscape. These countries have seen substantial investments and funding activities in the EdTech sector, reflecting the growing importance and potential of educational technology and eLearning on a global scale.

For example, the Brighteye Ventures VC firm has successfully concluded the final close of its second fund, raising $109 million. The primary objective of this fund is to support approximately 35 EdTech startups across Europe. With this significant capital infusion, Brighteye Ventures aims to fuel innovation and acceleration in the educational technology sector throughout the European continent.

Despite the weakening economic situation and declining funding, EdTech remains one of the most popular startup industries. In 2022, the global education technology market reached a valuation of $123.4 billion and is projected to hit $348 billion, according to Grand View Research. Experts forecast that this market will experience a compound annual growth rate (CAGR) of 13.6% from 2023 through 2030, indicating strong potential for considerable expansion in the coming years.

The high demand for innovative educational solutions and increasing technology adoption in learning environments create a solid ground for new ventures to enter the market. As long as startups can adapt to the changing market conditions and meet learners’ evolving needs, there are opportunities for success and progress within the EdTech space.

Entrepreneurs can launch new educational technology solutions rocking the industry today:

• Immersive Tech;
• Coding and Technology; 
• Learning Management Systems;
• Language Learning apps;
• Early Childhood Learning;
• STEM apps;
• Social-Emotional Learning apps;
• Online Courses.

These solutions can scale to millions of users across various sectors, including:

• Pre-K;
• K-12;
• Higher Education;
• Corporate learning;
• Consumer learning.

If you plan to invest in e-learning and education, look for tech enablers with relevant expertise. Here are what Geomotiv is ready to deliver today:

• custom solutions;
• education platforms;
• live classrooms;
• teacher lessons marketplace;
• online certification systems;
• miscellaneous LMS development services.

eCommerce

The pandemic made it more challenging than ever to find someone who’s never bought anything online. From 2020 to 2021, people needed to embrace lockdown, which resulted in a significant shift to sales via the Internet.  The trend continued into 2022, with retail eCommerce sales reaching $5.5 trillion, as estimated by Statista report. As a result, it propelled eCommerce to the list of the best startup industries, with plenty of investors looking for opportunities there. Retail eCommerce sales in the US alone amounted to $257.3 billion:

As we proceed with 2023, many experts assess the eCommerce industry as a mature and ripe sector preserving steady long-term expansion potential. Among growth drivers, we can find increasing consumer hunt for online shopping convenience, mobile device proliferation, improved personalization opportunities, and preference for digital interactions.

VC funding in eCommerce reached $37 billion in 2022, representing 9% of total startup investment, as announced by MAGNiTT's report. One of the growing startup industries, it remains a fertile environment for new entrepreneurs.

eCommerce can become more attractive for investors in some regions than CleanTech, Gaming, Healthcare, and Education. For instance, a recent survey by one of the leading VCs, Digital Horizon, revealed that out of 250 UK-based LPs, 20% have selected eCommerce and retail as their top investment sectors for the upcoming year.

As for already completed VC funding rounds in eCommerce startups from 2022 to 2023, we can observe that worldwide funding decreased to $37 billion compared to the same period in 2022 when funding reached $39.6 billion. Additionally, the number of deals in the retail tech sector experienced a decline of almost 50% during this timeframe.

Our analysis of public information from Crunchbase, Pitchbook, Seedtable, and other resources found that there are continued series of big raises from 2022 to Q2, 2023:

Large investment deals ranging from $100 million to $1 billion indicate a positive trend for the eCommerce industry in various countries.

Also, mobile app usage keeps surging, which has boosted mCommerce as a new way of online transactions using a mobile phone or a tablet. Mobile apps will likely become the primary channel for online shopping and “the next big thing” for this startup industry.

As per eMarketer's findings, mCommerce continues to be the favored choice among consumers worldwide. By 2024, the total retail sales from global mobile commerce will be approximately $4.5 trillion, constituting roughly 70% of the overall retail eCommerce sales.

The shift towards mobile dominance in eCommerce is evident in particular countries and regions. For example, eMarketer experts also mention that mobile commerce is set to comprise 43.2% of total eCommerce sales in the USA. This trend is also anticipated to approach the 50% mark by 2027. Presently, nearly 90% of mCommerce sales stem from smartphones, which are projected to experience a 16.7% growth in 2023. Conversely, sales from tablets and other mobile devices are expected to diminish year after year.

There is also an uptick of interest in online supermarkets, local cafés, ghost kitchens, catering vans. Timely and affordable delivery services are also in demand.

According to the most recent data collected by Grand View Research, the online food delivery market is worth $221.65 billion in 2023 and is expected to expand at a CAGR of 10.3% by 2023. Contrasting the average annual growth projections of various promising niches is fascinating. For instance, the agrotech sector's proliferation rate is notably lower than the rapid pace established by the online food delivery industry.

The soaring demand for online shopping and delivery services makes eCommerce one of the fastest-growing industries to start a business. It offers a massive opportunity for entrepreneurs in 2022 and the forthcoming years. The market is becoming very dense, which means that the competition is growing.

If you are thinking of developing an online store, then consider starting with a branded niche-specific product. You can find a particular area to specialize in and then push this strategy forward. It is more reasonable from the point of view of the allocation of investments and human resources.

Also, when facing the question of adding an eCom store in your processes, companies have two paths to consider: either to go with a system available on the market or build their own platform from scratch. With a custom solution, you can target all the goals of your company, but have to invest more time and money. Based on the size of your business, the price range for custom online stores starts from $60K and can go up to $300K:

• Basic version (core feature set with responsive design) - $60K+, 3-6 months
• Medium version (more features and design of a larger complexity) - $90K+, 6-9 months
• Large version (complex multi-level website design, development, and support*) - $300K+, 9+ months (ongoing)

*Explore an in-depth review of the stages involved in an eCommerce software development process in our recent article. 

In this context, Geomotiv can enable your business’s digital transformation with our custom eCommerce software development services.  

Streaming Services

TV watching and online streaming have surged during the lockdown and continue to add new subscribers and loyal fans as we proceed with 2023. Cord-cutting and the concept of content “anywhere and anytime on any device” continue expanding. Another factor that fuels the demand for streaming services is the popularity of binge-watching among consumers.

According to recent figures from S & P Global Market Intelligence, private equity and venture capital firms poured $370 million into streaming media companies worldwide in 2022. These figures show a decrease of 73% from the previous year's total of $1.38 billion. 

The number of transactions involving companies that provide video streaming services, audio streaming, and TV shows backed by private equity also decreased from 35 to 29 during this period. It's worth noting that in 2023, only three deals have been closed, as reported by analysts.

Despite the drop in investment activities, the streaming services market value continues to widen.

Analysts from Mordor Intelligence project the Video-on-demand (VoD) Market to accelerate from $104 billion in 2023 to $173 billion by 2028. The industry’s significant players await massive growth opportunities, with Netflix, Disney+, and Amazon Prime gradually expanding their reach.

Here’s how many paying subscribers the key global platforms have had in 2023 so far:

The video streaming landscape continues to get more crowded and fragmented as more and more players enter the market. Especially for the US, the video streaming landscape has changed, with Netflix gradually losing its market share because of the competition. Amazon Prime has shown more aggressive amplification, while Disney+ and HBO Max have slowed down.

The year 2023 is going to introduce fresh players to the streaming landscape. One notable instance is NASA, which intends to unveil its streaming service, NASA+, further diversifying the options available to viewers. Anticipated to debut later this year, this ad-free streaming platform is set to offer a spectrum of captivating content. Encompassing live broadcasts of upcoming launches, thought-provoking documentaries, and a fresh array of exclusive original series, NASA+ is poised to provide an immersive viewing experience.

As viewing habits change, mature VoD service providers will likely expand their offerings and attract more subscribers. Some invest in new content, while others focus on scaling to new countries and regions. For example, Disney+ has strategized an expansive global reach into an additional 30 nations in 2023, elevating its presence to encompass over 160 countries.

This upward trend will stand firm, making streaming services one of the best industries for startups. In this way, entrepreneurs can unlock numerous opportunities hiding in plain sight. With Geomotiv’s TV Media software development services, you can join the conversation and break into the game of streaming services.

Healthcare

There is no surprise that Healthcare became one of the fastest-growing industries in the world in the previous year. Health-related tech solutions are experiencing a push right now, even though most lavish events have been sidelined in 2021-2022. Booming business opportunities attract many exciting startups willing to leverage the latest advances in Healthcare software development services and technology.

The pandemic has undoubtedly set a direction for the industry, with investors pouring a record amount of money into health-related startups in 2021. However, investment advancement has slowed as we proceed with 2023. Healthtech companies secured $18 billion in 2022 and are expected to collect a dollar sum ranging from $15 billion to $25 billion, less than 2021’s anomaly ($29.1 billion).

Here’s how much funding investors have put into the top Healthtech companies in 2022:

Despite expectations of decreased valuations in 2023 among digital health investors, the industry's overall funding landscape remains robust. Numerous venture capitalists hold a positive outlook on Healthcare in 2023, identifying it as ripe for investment opportunities and one of the most popular startup industries.

Meanwhile, consensus among investors is vital. A novel GSR Ventures survey found that 51% of investors strongly believed in oncology as the most promising clinical sector for startups. This area is closely pursued by mental health at 37%, neurology at 27%, and primary care at 23%.

Another notable investment area of the Healthcare sector is Medical Biotechnology (BioTech). With revolutionary drug discovery and technology advancements, the BioTech sub-sector is grasping great investment opportunities.

Unicorn fundings in BioTech saw significant cash flow in 2023, with the majority of companies located in the United States:

It is also worth mentioning the advancements in medical devices and the proliferation of The Internet of Medical Things (IoMT). Wearable devices empower patients and individuals willing to care for their health through technology.

However IoMT went further in uniting disparate devices to ensure unified access to data for patients and doctors. The future of this technology looks promising, as reflected by its market size projections. For example, experts from Mordor Intelligence anticipate it to accelerate at a CAGR of 23.4% by 2028.

As a company with vast experience in the domain, we’ve helped various Healthcare providers to extend their services to remote areas using technology. Our software development team worked on a telemedicine solution that could facilitate remote communication between patients and doctors in real-time. Another piece of software was dedicated to meeting unprecedented demands of patient care with an AI-powered healthcare chatbot. Apart from driving substantial cost savings, the solution also helped to monitor health at home during quarantine. 

Other thriving areas include web and mobile apps for patients and doctors, Healthcare CRMs, healthcare analytics solutions, and BI services. If you are considering starting a business in the industry, Geomotiv’s technology experts can help you stay ahead of the curve and provide the most ambitious solutions. 

Transportation

Transportation is among the fastest growing startup industries, boasting several compelling factors that fuel its attractiveness. Firstly, the sector shows a pressing demand for digitalization, prompting the transformation of extensive data repositories into digital assets. This need aligns with the innovative capabilities of evolving startups, facilitating their role in driving industry-wide evolution.

The sector's impressive widening rates underline its attractiveness for entrepreneurial ventures. In 2022 alone, the Compound Annual Growth Rate (CAGR) reached a remarkable 18.3% for logistics and 13% for smart transportation sub-sectors. 

The transportation industry's enticement for startups becomes even more evident when considering the substantial size of VC funding it attracted in 2022. It reached an impressive $46 billion. This remarkable capital injection underlines the sector's robust potential and attractiveness to investors.

Prominent transactions during the quarter encompassed a range of remarkable endeavors. Among these, Chinese software firm JD Industrial Products stood out by securing an impressive $300 million in funding. Similarly, Oxbotica, a distinguished UK-based autonomous vehicle developer, raised $140 million. 

Such financial backing fuels the expansion trajectories of these companies and signals the significance of the transportation industry. Additionally, the move towards digitization unites new market entrants and traditional logistics providers. With the latest technology, companies automate back-office processes, improve inventory visibility and management, and reduce the number of human errors.

With a deep understanding of modern technology, our proficient team of developers and business analysts is also familiar with the Logistics industry. Geomotiv can work with you to help create digital solutions, including Delivery Operations solutions, Routing Solutions for Student Transportation, or any other type of Logistics software for your custom needs.

MarTech

The MarTech (Marketing Technology) sector stands out as one of the top startup industries, offering numerous compelling reasons for entrepreneurs to launch a new product. 

Notably, experts from Grand View Research confirm that the industry has immense growth opportunities. They found that the industry's impressive valuation reached $325 billion in 2022 and a projected CAGR of 20% from 2023 to 2028. With a landscape comprising approximately 8,000 companies and a steady expansion trajectory, MarTech provides a favorable environment for innovative companies.

Investment trends further reaffirm this point: MarTech attracted 5% of all global investments in 2022. Despite a slight decline in funding from $39.8 billion in 2021 to $28.4 billion in 2022, the sector remains ripe for venture capitalists, supported by active investors such as GV Capital, IDG Capital, and Qiming Venture Partners. 

Between 2022 and 2023, the world witnessed substantial investment rounds, with MarTech startups securing funding sums nearing the $500 million mark:

Notably, a significant portion of the industry's revenue, precisely 33%, originates from the robust North American market, which also serves as the primary location for most emerging startups. In 2022, the global MarTech sector witnessed substantial total funding of $25.6 billion, proving the considerable investor interest and confidence in its success. Martech.org, the leading publisher of industry-related information, provides the data.

This resource also mentions major technology drivers in this industry. They include Artificial Intelligence (AI), Augmented and Virtual Reality (AR/VR), Composability, and Web 3.0. They create a welcome ground for startups to shape the future of marketing technology. 

Geomotiv's teams are fully equipped to deliver clients various MarTech development services. You can count on us if you want to develop a custom MarTech solution from scratch or integrate existing systems with marketing and advertising tools.

FinTech

FinTech is another example of a rapidly expanding startup sector offering rich capitalization possibilities for investors. The industry has a current valuation of $194.1 billion in 2023, as announced by Expert Market Research. The report anticipates the FinTech industry to accelerate at a CAGR of 16.8% from 2024 to 2032, reaching the projected value of $492.81 billion.

The development of automation technologies and an ever-growing array of online and application-based services contribute to the attractiveness of FinTech for entrepreneurs and established companies. The surge in online banking and mobile payments has also empowered FinTech companies to introduce innovative solutions for consumers and businesses.

Comprising 17% of total startup investments, Fintech became a densely populated area for new ventures in 2022. Startups secured $83.7 billion of financial backing, though the cash flow decreased in the second half of 2022, as per our investigation of S&P Global Market Intelligence research.

As for 2023, global venture capital funding for FinTech startups witnessed a 49% year-over-year decline to $23 billion in the first half of 2023 amidst economic challenges. The deal count dropped by 64% compared to the first half of 2022. However, compared to H2 2022, FinTech funding values have increased, reaching $14 billion in Q2 of 2023.

Large billion-dollar deals have ballooned the FinTech funding value and contributed to the growing interest among large investors. Top deals comprise Stripe's $6.5 billion round and Alibaba's Ant financial unit raising $1.5 billion. Other substantial cash injections include:

While the investor's enthusiasm and the market potential remain high, it's crucial to acknowledge that the FinTech sector comes with specific challenges. Regulatory compliance and security concerns stand out as potential hurdles for entrepreneurs. Achieving success in the FinTech industry demands a profound comprehension of technology, finances, and regulations.

If you have a new idea for a FinTech startup but want to put it to the test, you can count on Geomotiv. Our Business analysis experts can aid in assessing your idea’s feasibility, considering all underlying risks and potential hurdles. Contact our experts for an in-depth BA stage for your new venture.

Artificial Intelligence

In 2023, the AI startup investment landscape is witnessing visible signs of expansion. The market value has surged to an impressive $133 billion, propelled by a CAGR of 37% projected from 2023 to 2030. 

This trajectory mirrors the expansive AI adoption across diverse domains, which generated the subdivision of AI startup industries. Other growth factors include support from local governments and the shift to digitalization on global and national levels.

Notably, the volume of venture capital (VC) funding in the preceding year, 2022, reached a significant milestone of $52.1 billion. This substantial investment constitutes a 12% share of the total VC cash flow to startups in the same period.

As for the first half of 2023, AI-related startups secured $25 billion, accounting for 18% of global funding. This sum includes the $10 billion Microsoft-led round for OpenAI in January. Crunchbase reports that this amount falls short of the $29 billion invested in the initial six months of 2022. However,  it represents a more significant share of the global funding pie.

Several funding rounds involving AI-related startups alongside OpenAI have captured the attention of the investment community during the first half of 2023:

Many experts confirm that the demand for AI solutions will remain rising in the coming years. For example, McKinsey's online survey found that numerous organizations have transitioned from experimenting with AI to actively integrating it into their Enterprise applications. However, the tech talent shortage is the primary factor causing numerous companies to slow down their AI-related efforts.

Most survey participants (roughly 32%) indicated challenges in recruiting for various AI-related positions over the past year. These findings show that companies must embrace diverse hiring options to meet the increasing demand for AI developers.

However, thanks to software development companies like Geomotiv, talent sourcing and hiring have become more effortless. Geomotiv provides instant access to experienced AI and ML developers with advanced theoretical knowledge and proven practical skills.

Blockchain

Blockchain technology presents a remarkable opportunity for startups to establish new businesses in today's rapidly evolving technological landscape. The market size of blockchain technology is impressive, reaching $10.02 billion in 2022, according to Business Research Company. The projection indicates an 87.7% CAGR from 2023 to 2030, estimating a market size of around $100 billion by 2027. No fastest growing startup industries on our list can boast such favorable estimations.

One of the primary drivers of this staggering boom is the substantial influx of venture capital funding and investments in the blockchain sector. In 2022 alone, investors injected over $30 billion into blockchain initiatives, constituting 7% of total startup funding for that year, as stated by MarketsandMarkets. 

Although 67% of the market revenue currently originates from large enterprises, there is an increasing demand for blockchain solutions among small and medium Enterprises (SMEs). This trend underlines blockchain's wide-ranging appeal and potential impact across various business sizes and scales.

Grand View Research reports that the second half of 2022 witnessed a decline in investments due to disruptions in the crypto assets markets. Additionally, uncertain regulations, a need for standardization, and a tech talent shortage incur additional challenges.

However, the momentum remains strong with massive investment rounds in 2023. For instance, BitGo, a US-based digital asset trust and security company valued at $1.7 billion, secured $100 million in funding. Another notable example is Tools For Humanity, a Germany-based company focused on Wordcoin development, which raised an impressive $115 million.

Geomotiv knows how to compensate for the technical expertise required to harness the power of blockchain technology. Our experienced company offers qualified developers to help you design and build a cutting-edge product for your blockchain-related startup.

Closing Thoughts

If you are thinking of promising industries and technologies to invest in, our list may help you succeed in 2023 and beyond.

For entrepreneurs looking to launch a new product, you are better off embracing the latest technologies like Artificial Intelligence and blockchain and keeping a close eye on EdTech, eCommerce, Streaming services, Healthcare, Logistics, and MarTech industries.

That is where technology experts can step into the rescue to reinvent traditional businesses and develop new, compelling solutions for the future. If you are considering taking the opportunity to compete in one of the fastest-growing industries to start a business, engage Geomotiv’s team.