2015 looks like an important year in the future of many startups. They may be good ideas, but they have to chart their course through a variety of external factors if they are to stay alive. Which are the most interesting? Which sectors should we pay attention to? I'll tell you all you have to know to understand what this year 2015 will be like.
Sector, momentum, team and exit possibilities. These are the four basic pillars that professional investors look at when it comes to putting their money into a startup. They are out to earn money (a return), so they season their decisions with the external flavors of the market situation, which has little to do with the technology itself, but rather everything that is involved in a business project: competition, finance, legislation...
La Nevera Roja, Spanish start-up
Among these external factors are also the processes of mergers and acquisition, the changing habits of a broad consumer base and the needs that arise in a business sector. Over and above the development of their businesses, startups have to be ready to climb on their surfboards and ride the wave of external factors.
That is what has happened, for example, with La Nevera Roja, the Spanish food home delivery food that was making a loss, with a grim outlook for survival due to the need for new investment. However, its operations desk knew about the battle begin waged by various giants in its sector (Justeat, Delivery Hero, Foodpanda...) and they have surfed the wave to success with an 80-million-euro deal.
In 2014 around 300 million euros were invested in projects at the initial phase, with prospects of expansion and high growth. Little or none of this money went to a forgotten sector, that of classified ads. However, two of the biggest exits last year were in this sector: Milanuncios (100 million) and Trovit (80 million). Milanuncios was the result of a defensive move by the multinational Schibsted in the face of a startup that was eating away at their market. Trovit was triggered by the Schibsted operation, a Japanese group with global aspirations that turned its attention to Spain after the move by its Norwegian rival.
Tourism, cybersecurity, games and e-commerce
There are two examples here, but there could be many more. From the point of view of an investor and also in theory there is a handful of startups that could feature in similar episodes in the future. The tourism sector is one that is worth paying special attention to. The wave of consolidation between OTAs (travel platforms) and the insatiable appetite of groups such as Priceline, Tripadvisor and Expedia puts tourism startups at risk of experiencing the wave of external factors from close up. The Madrid app Minube has much in its favor in this respect: international recognition of its app, a community of loyal travelers and the experience of investor partners (Bonsai, Kibo) that have already been involved in operations of this kind.
Cybersecurity is another of the areas in which sparks are expected to fly in investments and acquisitions. The major companies and institutions already see this issue as a priority, with a mixture of generalized hysteria (not without reason) and negative experiences due to attacks on their infrastructures or data theft. There are few Spanish startups in this sector, but among them two can be highlighted. Blueliv, a startup sponsored by Telefónica and the founder of Password (acquired by Symantec) reflects the typical profile of a project that combines business growth and the potential interest of its own partner to acquire it. Enigmedia, a project for the encryption of calls, with its own patents and winner of the Cybercamp competition (organized by Incibe) is another of the candidates for investment.
Among game developers, Omnidrone and A Crowd of Monsters are two of the most interesting startups, with strong investor support at their initial stageand that continue to follow in the footsteps of a very large consolidated company: Social Point. In the e-commerce sector two technologies will continue to make the news: Wallapop, the second-hand market app that has emerged strongly in the small ads sector; and Promofarma, a marketplace that puts pharmacies in touch with buyers of healthcare and beauty products in the large parapharmacy market.
Spain will again miss out on any significant event inthe fintech sector, which is in vogue around the world. This is because the development of this activity in the Spanish market is suffering from the Eye of Sauron syndrome, as epitomized by the long arm of the Bank of Spain and the industry lobby created by the eight banks still operating. Two of the Spanish-based projects with the biggest projection packed up and left for countries with friendlier legislation and today they are highly successful in London (Kantox)and Boston (Peertransfer). The irony is that BBVA is investing strongly in foreign startups in this sector (Sumup,Simple, Coinbase). As is Santander (iZettle,Monitise...). Bankinter, Caixa and Sabadell have only dipped their toes gingerly into the water in the sector. But the other banks appear to be more concerned with defending their traditional business rather than getting up-to-date with the upcoming digital and financial revolution.