What Venture Capitalists look for in 2020?

What sort of trends can we expect investors to be interested in 2020? Here are some views from VCs on this:

• After what happened to WeWork, investors now require firmer company governance and structures to protect themselves from any negative impact. These protections will be written down in the term sheets. Companies with similar operating styles (i.e. hyper-burn, growth-at-all-cost) may have difficulties in getting investments.

• The IPO market will slow down, replaced by a surge in Mergers & Acquisitions (M&A). With pubic equity investors being more critical about startups and how it can profit, these startups may turn to other strategic investors to buy their company.

• To add a competitive edge to their business, people will start looking into machine learning and AI. Personalization will continue to be a trend, and machine learning will be used to make better personalized predictions and while collecting personal data. As the technology evolves, companies will need to consider issues of data privacy and security. One method of achieving this is to run machine learning locally on consumer devices, instead of on cloud.

• There will be progress in quantum computing, in countries such as China, Japan and the US.

• The roll-out of 5G networks will provide a new opportunities for startups to compete and innovate.

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Source:
Taulli, Tom (2019, Dec 6). What Venture Capitalists (VCs) See For 2020.
Retrieved from: https://www.forbes.com/sites/tomtaulli/2019/12/06/what-venture-capitalists-vcs-see-for-2020/ (Last accessed 2019, Dec 11)