As the Great Resignation continues in full swing, some people are skipping the job hunt altogether and pursuing entrepreneurship. A record 1.4 million Americans filed applications to start new businesses in September 2021 alone, according to an analysis of Census data by the Economic Innovation Group (EIG). In October, more than $54 billion was invested in over 2,000 companies around the world. Some of the hottest sectors? Wellness, finance, and property technology (aka proptech).
As Helaine Knapp, founder and CEO of fitness startup CityRow, tells Fast Company, “I think we need to be prepared for anything in 2022.” As such, we tapped Knapp and other experts to find out what trends this year holds.
Hybrid is here to stay
Events, in particular, may never be the same. That is a good thing for Alon Alroy, cofounder and CMO of events platform Bizzaboo, who is betting the future will be hybrid.
“The future is going to be about flexibility and choice,” says Alroy. “There will be large in-person events, there will be small in-person events, but each of those new ways of gathering will now have a virtual component as well. And that creates a lot of room for innovation.”
He isn’t the only one who sees the advantages of a hybrid business. CityRow’s Knapp thinks entrepreneurs are better off than before when it comes to raising capital. “[There] likely will be a lot more remote fundraising, a lot more remote deal-making, which has a lot of advantages to it. If you choose to see them, and just be able to make the best with every single card that you are dealt, even if it’s something that you were not prepared for. I think that’s what’s going to separate the good from the exceptional entrepreneurs in 2022,” says Knapp.
Crypto, blockchain, and no-code tech will continue to disrupt traditional business models
The digital space isn’t all about fundraising or hosting events, however. Neil Sequeira, co founder and a partner at Defy venture capital, believes disruptions are ahead for legacy businesses. “You’ll see the crypto DeFi [decentralized finance] blockchain businesses opening up more business models in traditional markets that are already being disrupted,” says Sequeira.
This means room for innovation. As financial and no-code technology becomes more accessible, finance, insurance, and other legacy businesses will see more competition. Small business owners and startups alike will be able to use these tools to overcome inefficiencies, and challenge more well-established businesses.
“The foundation has been built for people to do this, but what are the windows and doors and kind of the applications that run on top of that foundation going to look like? That is where there are plenty of places still to invest,” says Sequeira.
Focus on Environmental, Social, and Governance (ESG)
2022 will bring a renewed focus on the environmental, social, and governance impacts of businesses. For Sequeira, this means a “focus around climate sustainability, where ingredients come from . . . where the products are created, and the impact they have on the world,” he says. But it doesn’t stop with consumers and the products they purchase. This trend is taking root for employees as well, with younger generations wanting their employer’s values to match their own.
“It’s critically important to them that they are working somewhere where the impact of what they do on the world is accounted for. And that is a change from many generations in the past,” says Sequeira.
Darren Bechtel, founder and managing director of Brick and Mortar Ventures, knows the importance of ESG but has worries about the reality of the investment landscape. “I fear that it’s being used as a little bit more of a buzzword, and there’s a lot of money being thrown around just to check boxes,” he contends. “I think there are companies that lack really scalable, sustainable business models that have successfully raised money,” Bechtel adds, but cautions that there might be a “little bit of a day of reckoning.” He explains it may be similar to what we witnessed in the early days of drones for construction. “Those generalist investors all thought it was the greatest thing since sliced bread. And there were just massive valuations and massive rounds, and then just a field of dead bodies and recaps,” says Bechtel. “I’ve worried that we might see that happen.”
Sink or swim for real estate
As tech becomes a permanent fixture in everyday life, it’s time for real estate to catch up. Brendan Wallace, cofounder and managing partner at investment firm Fifth Wall, sees 2022 as a year of enormous secular growth in real estate and proptech. Despite being roughly 13% of the U.S. GDP—and one of the largest asset classes and lending categories—real estate has been one of the slowest industries to adopt new tech, says Wallace.
He believes the real estate industry is bifurcated between organizations that embrace change and technology, and those that don’t. “I think that means that the larger, more tech-forward, frankly, more sustainability forward, real estate organizations are going to grow and scale,” says Wallace. These will likely reap the advantages of size, cost of capital, and efficiency, he says.
More flexibility and personalization for everyone
Whether it’s fundraising techniques, events, exercise methods, education, or jobs, 2022 will bring an abundance of options for people and businesses. Finding what works best for you will be the goal. To do so, Knapp says leaders must have their finger on the pulse of their industry, and be prepared to help shape their future.
“That’s what we’re doing at CityRow with our true omnichannel,” says Knapp, “to really connect with consumers in the two fastest-growing verticals of fitness.” For Knapp, that means offering brick-and-mortar studio space and expanding digital workout options from home.
In a recent report, Fast Company senior writer Liz Segran spoke to tech entrepreneur Melissa Bridgeford about Wizard Commerce, a new platform she cofounded. Set to launch in 2022, it will allow consumers to text a brand, discuss products, and ultimately buy items through a secure website that also saves payment information. “The fact that conversational, text-based commerce is so popular in Asia suggests that it could also take off here,” Bridgeford said. “And we believe that the time is right for American consumers to try this new approach to shopping.”
Sequeira of Defy observes, “We’ve had this foundation of a change of distributed, both, from a crypto and blockchain side, but also a workplace and people side of things.” For example, Defy is working with GajiGesa, a fintech company designed for unbanked Indonesian workers. Instead of allowing them to fall victim to predatory lenders with high interest rates, GajiGesa allows workers to withdraw their earned wages immediately. They now work with over 120 companies in various sectors and boast that over 80% of their clients no longer use informal lenders.
“Think about the past two years,” continues Sequeira. “Every board meeting has Zoom, but what is going to make that experience better?” He likens an application like videoconferencing to the floor of a new house. “But then if you look at the house, well, there’s so much more to it, there are paintings on the walls.” That is where he sees a lot of room for compelling innovation and potential improvements.
The pandemic has changed the way we live, work, and socialize. Everyone from grandparents to students became proficient in navigating digital spaces and the new normal. As businesses begin to reopen, this won’t change, but instead, continue to evolve. And the world of entrepreneurship will follow suit. Sequeira muses, “And how do you take that and make it a really beautiful place to live?”
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