Top 5 fastest growing industries of 2019: a review of the investments in startups

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In 2019, Healthcare, Transportation, E-commerce, Artificial Intelligence, and Financial Services segments were home to 2019’s fastest-growing startups that attracted the most of VC investments. These industries are emerging and reaching new milestones with each passing day. We prepared this report so that you can familiarize yourself with the most trending market sectors of the last year.

The report is based on publicly disclosed funding rounds of 2019, from seed to late-stage venture, collected from Crunchbase’s dataset. We excluded companies with non-US HQ. All funding values here are given in US dollars. Please note that some companies may appear in more than one sector as, according to Crunchbase, they refer themselves to several categories that may intersect in this report.

Top 5 market sectors with the most dollars invested in 2019

This year’s top industries with the biggest venture capital investments include E-commerce, Health Care, Financial Services, Artificial Intelligence, and Transportation. $5M investments dominated most sectors peaking at the Transportation sector and dropping to $3M+ for E-commerce businesses.

Health Care: Industry overview

In recent years, we are seeing the health industry merging with new technologies extensively. The following HealthTech related fields of expertise dominated the market in 2019: Artificial Intelligence (AI), Blockchain, Big Data and Analytics, Telemedicine, Internet Of Medical Things (IOMT), Virtual & Augmented Realities. Rapid advancements in the above technologies will present significant disruption for the healthcare industry forcing businesses to adapt quickly.

Top 20 trending startups

Predictions for 2020

  1. Digital-Native Healthcare Executives will lead the industry in the next decade.
  2. The use of AI and investments in healthcare Machine Learning (ML) technologies will rapidly increase.
  3. More people will start moving towards online consultations/home-based care/telemedicine/mobile health due to convenience, the lack of time and other reasons.
  4. Blockchain’s use in healthcare is going to increase, especially in regards to patient data protection.

 

Transportation: Industry overview

Digitalization continues to progress each year within the transportation industry. Data and technology are what will help companies move forward in building more efficient transportation systems in 2020. Although the industry is now facing some major obstacles due to the lack of tech training, the future is promising for those who will embrace the innovations.

Top 20 trending startups

Predictions for 2020

  1. Micro-Mobility will flourish in the upcoming years and eventually will transform the look of major cities. 
  2. 2020 is going to be a pivotal year for space travel as spacecraft should be able to carry a crew.
  3. The growth of fully autonomous vehicles will be used to resolve the driver shortage issue
  4. Sustainable transport technology solutions will continue to evolve rapidly and attract huge investments.

 

Financial Services: Industry overview

According to TechCrunch’s latest report FinTech sector in the US has seen enormous growth in 2019 with a “stampede of fintech unicorns”. The financial services market expected to grow at a 6% rate and reach $26.5 trillion by 2022. As expected, technology is changing the industry here too. Non-cash and mobile-based payments are spreading all over the mature markets.

Top 20 trending startups

Predictions for 2020

  1. The use of artificial intelligence will continue to increase and play a vital role in the finance sector. AI is predicted to save $1.3 billion for the insurance industry by 2023. 
  2. The segment of digital payments via smartphones is booming. 
  3. Blockchain technology will become more mature and will be a key weapon in the battle against cybercrime. 
  4. More banks will go through automation and digitalization. This transformation includes measures that are going far beyond replacing the bank teller.

 

Artificial Intelligence: Industry overview

Artificial Intelligence has touched nearly every sector in 2019 and undoubtedly will continue to contribute to the development of many industries in 2020. The future of the market looks attractive with opportunities in Healthcare, E-commerce, Fintech, Agriculture,  and Automobiles, etc.

Top 20 trending startups

Predictions for 2020

  1. 2020 will be the year of ubiquitous adoption of Machine Learning in the autonomous applications and IoT-enabled devices.
  2. AI will advance the Healthcare sector, make it less costly and more accurate.
  3. AI tools will get better as data becomes more accurate and available. As a result, the line between human beings and AI will become harder to distinguish. 
  4. Humans will start to learn new skills to cooperate with AI tools and co-exist with these new robotic instruments.

E-commerce: Industry overview

In 2019 the E-commerce sector was experiencing remarkable growth and some experts predict this trend will stay in the upcoming years. According to Statista, retail e-commerce sales will nearly double from the $3.5 trillion in 2019 to $6.5 trillion by 2023.

China remains the owner of the biggest share in the B2C e-commerce market, making up almost 50% of the globe’s retail e-commerce revenue, followed by the US which led by the e-commerce giants Amazons & eBay. B2B e-commerce, where the market is almost three times larger than retail, is predicted to show similar steady growth.

Top 20 trending startups

Predictions for 2020

  1. People don’t buy from one channel solely, so more businesses will be adopting multi-channel selling in 2020 and making themselves available across all of the channels their customers use.
  2. Businesses will fully embrace mobile, starting from smooth experiences on mobile devices to smarter payment processing. 
  3. Reasonable consumption and environmental consciousness become even more relevant both for B2C and B2B e-commerce organizations. 
  4. Customer service and personalization will move to a new level thanks to such technologies like AI, Augmented and Virtual Reality (AR and VR).

Conclusions

The industries that we covered in our report took the business by storm in 2019. According to all the predictions, they hold tremendous potential for entrepreneurs in 2020. If you’re thinking about starting a business in 2020, our report may help you choose a growing industry with lots of potential.

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Viktoriia Horbunova
Written by
Viktoriia Horbunova

Viktoriia Horbunova is a digital marketing specialist at YouTeam, Y Combinator-backed platform for building remote dev teams.

Viktoriia's areas of interest include content production, market research, and tech entrepreneurship.

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