5 Tech Investment Trends to Keep Your Eye On
There are few sectors more exciting – or potentially lucrative – as tech when investing.
However, since the world of technology is constantly evolving, it can be challenging to know which areas of the expansive tech sector to keep your eye on and invest in.
With this in mind, these top 5 tech investment trends currently dominate.
1. Developments in the Metaverse.
By 2024, Bloomberg Intelligence predicts that investment in the Metaverse will likely reach $800 billion. Meta – formerly Facebook – has already invested over $10 billion in the concept, and many investors have followed suit.
As the virtual world becomes an even more significant part of our lives – in the form of phenomena such as cryptocurrency and Virtual Reality experiences and gaming – we can only expect this movement to expand in the future as the Metaverse becomes a staple of our real-life world.
In particular, the increasing monetisation of digital assets such as NFTs and digital versions of physical goods make the meta-market one with huge potential, mainly since the cost to produce digital assets is significantly lower than their physical counterparts.
Powered by blockchain technology – where records of transactions are kept in ledgers designating ownership – we can expect countless businesses to jump on this opportunity, and investors should take note of this future-altering trend.
2. Evolving payment systems.
The world of Fintech is growing exponentially as technological advances create new possibilities for the future of finance – especially in the form of new payment systems.
Over a hundred fintech start-ups have reached unicorn status, showing the vast number of opportunities there have been for finance tech to disrupt the space – and how profitable investing in these start-ups can be for investors since many have become worth billions.
In particular, embedded financial services are a massive movement in the world of Fintech currently. It allows non-finance-centred businesses to offer financial services to customers, and these same companies to employ Banking as a Service (BaaS) and embed financial services into their systems.
Digital wallets – where digital currency and digital goods such as NFTs are stored – are becoming increasingly prevalent as their use-cases increase and fintech companies expand the range of what they can accomplish with their innovations.
3. Cloud computing and SaaS.
Over the last decade, organisations across countless industries have been using cloud-based services and outsourcing to SaaS companies to fulfil their needs.
What’s more: as a result of the COVID-19 pandemic, global digital transformation sped up rapidly – particular in the world of business – as many people were forced to communicate, work and orchestrate their leisure time in the digital world, leaving us with technologically-enabled world years ahead of its time.
This global digital transformation hasn’t slowed post-lockdown, and the use cases for SaaS and cloud computing continues to grow – as do the number of SaaS start-ups and cloud computing tech firms.
McKinsey notes that one of the newest and biggest cloud and edge computing trends is “distributed infrastructure”: a phenomenon allowing companies to operate more remotely, access analytics on demand, and strengthen cybersecurity, among other uses, by moving their computing to the edge of their networks.
4. Robotics & AI.
From Electric Vehicles (EVs) to fully-fledged human look-a-likes, AI and robotics are transforming many traditionally human-led tasks and processes, from driving to data processing and analysis.
Tesla believes that human-imitating robots could be the answer to the labour shortage problem in the US and across the world. Conceivably, the robots could step in to complete labour-intensive processes such as assembly, packing, lifting and transportation of goods throughout a building.
Aside from that, EVs – fuelled by artificial intelligence (and electricity, of course) – provide one part of the puzzle piece to the climate solution. As such, they will only become more popular in the future.
Moreover, businesses are rapidly turning to AI to drive their analytics and to make the best data-driven decisions for their business. These are only a few of the many growing uses cases of robotics and AI.
5. M&A is ramping up.
As a result of the many exciting developments in tech, the rapid shift towards digital transformation in all aspects of life and the immense potential profitability of tech start-ups, investment banks have taken an increasing interest in the tech world.
As a result, it’s expected that the number of mergers and acquisitions of tech businesses is set to ramp up, as predicted at Morgan Stanley’s Technology, Media and Telecom (TMT) Conference in San Francisco.
Start-ups and SMB tech businesses will likely grasp this opportunity to grow and achieve greater reach more quickly, while M&A firms will acquire and merge the start-ups they believe could be immensely profitable.