The future of startups
We have been riding the startup wave for nearly a decade now and things are changing quite rapidly. What was the dream of so many young people, this lost haven they searched for; this adventure they engaged in; is today a much more complex phenomenon. The days were you would simply pitch without any premeditation on how you will get your money are long gone and open way to a world of complexities and politics entrepreneurs have to understand when venturing into a startup.
So what is the situation of startup ecosystems today?
To answer this question, we need to divide ecosystems into 3 different categories just like countries: The developed, the emerging, and the undeveloped. This is a first indicator of the rationalization of the concept of startups whereby it is no longer the wild wild west, but a new organized industry that nearly mimics national economies. The developed ecosystems such as the United States, or western Europe have pretty much matured and barrier to entry became quite high for new players in different industries. Cost of entry has also drastically increased, although decreasing in matters of technology cost, it is radically higher in matters of sales and marketing expenses required to get new users making cost of user acquisition quite the handicap.
Emerging ecosystems which are few are struggling to attract entrepreneurs due to the nature of such ecosystems. Today emerging ecosystems are located in small to medium populated countries with an average target market making it a challenge to venture into such markets especially with the availability of already operating solutions trying to open new markets with already developed processes.
Undeveloped Ecosystems, mainly in Africa, are still far away and struggle from basic infrastructure needs and lack of support to startups and entrepreneurs.
In the MENA and GCC, ecosystems are still active but no longer hold the hip that once was; the UAE is turning into a new R&D hub for the region and the vision by 2022 is to host all major international corporations within the UAE. KSA is undergoing major changes and reforms and will still fuel the region with strong startup concepts and ideas. Egypt is also a major hub with over 100 Million inhabitants it is seen as the next big thing in the region. All in All we will still see startups growing but the pace of high growth startups in long gone.
Coming back to our initial question as to the future of startups, it needs to be clear that technology companies as a term is becoming quite obsolete. There are no technology companies as every company is using technology and is in need to develop software to remain in play. The future is again to what I live to call SMMEs [Small to Medium Sized Modern Enterprise] comprising of new E commerce businesses, online service providers, Software providers, and software that connect to end user solutions to speed up processes.
In 15 years, the world will be a virtual replica of what it was prior to the internet and our brain and way of functioning will be virtually present making it easier to cut distances, eliminate borders and create our own version of the world we live in.
Entrepreneurs today should be more focused on taking a part of what will come than disrupting it.