My 2022 Predictions
Happy New Year to you and your family! In addition to well wishes for 2022, I also wanted to take a minute to kick off 2022 with some predictions for the year! Some of my own, but also let you know what predictions I am following from others.
Visited Moraine Lake in Alberta, Canada in 2021.
An investment theme I am closely watching as we head into 2022?
The Artificial Intelligence tools & APIs recently released for software developers enable an entirely new level of automation for software platforms. One example, GPT-3 is a text-based A.I. model from Elon Musk & Sam Altman’s company Open AI that you simply prompt with plain English text, and it will generate an incredibly accurate response. What is fascinating to me is how these AI models continuously improve, to the point that GPT-3 can now even code portions of your app for you, from something as simple as a prompt that says “create a user signup screen.” And within a few seconds, GPT-3 will write all the code, and the browser will render the page with a brand new, fully functioning signup screen. This simplicity and open access will unlock the door for a whole new generation of founders and builders.
What's a trend that is buzzy but will take some time in 2022?
Everyone is talking about the impending third phase of the internet called Web3, which the builders and users decentrally own, orchestrated with tokens. I love the concept of Decentralized Autonomous Organizations or DAOs as I believe they could be the next evolution of what a company is.
I do think the path blockchain technology is on will take the internet closer to this Web3 vision of the future. However, I have spent some time personally building in this space with my company Finta, which provides fundraising software to founders and diligence tools to investors. Finta originally started as a project called Equity Token and through that work, I have seen firsthand how important it is going to be for the SEC to modernize and clarify its securities regulations for a world where tokens can flow freely in a decentralized environment while still representing equity ownership.
Andresson Horowitz recently advocated that the U.S. government create some policy guidance for entrepreneurs to build within. Otherwise, these web3 innovations might happen outside U.S. borders.
What's a development in fundraising founders should know?
Venture Capital is at an all-time high. According to Crunchbase, “prior to 2021, global funding had not reached over $100 billion in a single quarter. Funding in 2021 has far superseded that amount, with the first quarter tracking at $135 billion, the second quarter reaching $159 billion, and the most recent quarter peaking at $160 billion.”
While access to capital is at an all-time high, and we live in a world where fundraising announcements receive constant glory in the press, the outside appearance to other startup founders can be that fundraising rounds constantly happen with little effort. But the data show’s that most founders log over 100 meetings with different investors to eventually secure the investment they need to safely have 18-24 months of runway in front of the company.
So I want founders to remember that they are not alone and should keep fundraising beyond any initial rejections. Don’t take the rejection personally and use the feedback to improve your pitch for the next investor. I find it has been helpful to get founders into the mindset of thinking about the fundraising process more like a sales process, but this time the product is just different. Instead of a good, you are selling equity in your company. The right investors for your company are out there; you just need to find them so they know you exist. Keep going!
Other 2022 Tech Predictions I Am Following:
Scott Belsky, the founder of Behance and Chief Product Officer at Adobe, put out a great article yesterday on the “10 Forecasts For The Near Future Of Tech”.
Every year Fred Wilson publishes his predictions for the next year and here is Fred’s predictions for 2022. I have to agree that the carbon and climate tech spaces are def heating up, from what I am seeing. What I love about how Fred does this each year is that he also recaps what he got right and wrong the previous year. You can read his 2021 as well.
Finally, The All In Podcast has become one of my favorite listens this past year, and the besties released their tech predictions for 2022 in the latest episode, which you can watch on Youtube or listen to the podcast. The whole episode is good, but a great segment worth listening to on payment rails in fintech, starting at the 27 min mark.
I hope you enjoy the new year and wish you the best of luck in 2022!
