- Founders in the Cloud
- 6 hot tech startup trends for 2024
6 hot tech startup trends for 2024
What startups and VC's are telling us to watch this year
One of my favorite sci-fi movies of all time is Minority Report. While a departure from the Philip K. Dick story it is based on, the world-building and action made for an engrossing film. But the real fascination was with the three “Precogs”, mutants that could predict murders in the future.
While there are a few messages one can draw from the story, the key lesson is the frailty of certainty. A whole system of criminal justice called Precrime was built on the strength of the predictions from these Precogs. Yet unknown to the general population, sometimes the Precogs disagreed with each other.
Around the start of each new year, prognosticators across all fields come out to tell us the future. These forecasts range from bland and obvious to outlandish and improbable. Wherever they land on this wide spectrum of bets however, their predictive power is more a shot in the dark than informed insight.
What’s in store for tech startups in 2024?
Yet here we are, a couple of Startup Advocates, taking a wide swing at what the future holds for the world of tech innovation and startups. What gives us any better idea of what to look for in 2024? Our position gives us a unique and privileged insider view into what startups are doing across industries, sectors, and geographies. This means we at least have a decent basis for our predictions.
So how did we do with previous year’s predictions? We are about one for three, but just like in baseball, batting over .300 is pretty solid. The rise of web3 in 2022 never happened, nor did cloud sustainability garner any momentum. However, the ubiquity of AI and how Generative AI would shape the developer experience did become reality in 2023.
With that introduction, what are the growing trends shaping tech in 2024? While we are already five days into the new year (are we cheating?), here are six potentially big ideas we are watching closely:
Earlier this week, we saw a tweet about a robot that could cook a complete Cantonese meal, clean up drink spills, and high-five colleagues. While not only delicious and useful, we are starting to fully see the utility of robotics for everyday tasks rather than as toys or slightly terrifying Terminator-esque figures.
The first generation of robotics companies led the way such as Boston Dynamics, Hanson Robotics and iRobot. Now the latest generation of startups are taking the technology even further with the power of Generative AI across every industry, especially in manufacturing with companies like Apptronix, Integral AI, and Veo Robotics making robots and humans smarter on the factory floor.
Conversational AI resurgence
How cool was it watching the old Star Trek episodes where the crew would speak to the computer and things would just happen. Using Alexa, Siri, or Cortana though was never as satisfying. While the vision of AI-driven voice interfaces was there, the reality fell way short. Why? Because the approach to training these single-purpose machine learning models was tedious and inflexible.
Generative AI has brought a refreshed approach that better understands the nuances of human speech patterns. While the leading interface in AI is currently the chat window, there are numerous startups that are building the future platforms for reliable voice interfaces. In the near future, we may be talking to, instead of typing on, our phones and devices.
Crypto emerges from the dead
In a year where everything pivoted to AI and the regulatory environment hardened, many web3 players kept building out of the limelight. There were exciting infrastructure updates such as L2 Rollups and zk Proofs, while consumer retail projects and gaming were still going strong. In fact, AWS built even deeper partnerships with web3 leaders like Ava Labs, Animoca Labs, and Polygon to help builders build more robust and secure blockchain apps.
While AI has garnered all the attention in the past year, concerns are escalating about the authenticity of content and ethical use of AI. The irony is that web3 and the blockchain will become the underlying technology to bring greater trust and transparency to AI. Expect to hear more about the convergence of AI and web3 in 2024, which Fred Wilson of Union Square Ventures mentioned in a recent post.
Frugal cloud engineering
During AWS re:Invent 2023, Werner Vogels, Amazon’s CTO, spent a lot of time during his keynote talking about the “Frugal Architect”. His point was that with all the power, resources, and constant innovation available with the cloud, there is the risk that organizations build infrastructure that is neither optimized nor cost-efficient for the business needs.
Cost optimization was a common theme in 2023 as companies from enterprises to startups scaled back their cloud costs. There is already a large constellation of startups in the cloud ecosystem to solve for siloed aspects of optimization around compute, security, financial management, and so on. What is beginning to emerge however are startups provide more holistic optimization using AI to drive further cloud cost savings and architecture optimization.
Rise of hybrid soft / hard startups
Software may be eating the world, but AI is eating software. This is already happening for software development where upwards to 40% of all code will be AI generated by end of 2024. The implication is that relying on software alone for a competitive advantage is not enough for startups when anyone armed with an AI-coding assistant can build a competing product that ships faster with better features.
While the traditional competitive moats like network effects, patents, domain expertise, and data are still relevant, a newer model is emerging that couple software and hardware components. While not relevant for every use case, VC’s are increasingly betting on hybrid startups on the thesis that they are harder to copy and offer stronger first-mover advantage, especially in smart robotics and AR/VR apps.
SpaceTech accelerates into orbit
One of the most interesting announcements during AWS re:Invent wasn’t about a new service. It was when Adam Selipsky ended his keynote with Project Kuiper to bring private broadband connectivity through low Earth orbit satellites for AWS resources. It highlighted for us just how far the space industry has come over the past 20 years since SpaceX launched with their ambitious vision.
Other sectors often get more attention such as Fintech and Life Sciences. SpaceTech has been gaining more traction lately as SpaceX and Blue Origin have dramatically lowered the cost of launching payloads into space. With the economic model being more reasonable and providers like AWS supporting startups through industry accelerator programs, expect to see many more startups to explore this market following on the heels of Lunar Outposts, Privateer, Relativity Space, Varda, and others.
What trends are you watching in 2024? Let us know, we look forward to hearing your thoughts on what you think is going to be hot this year!
So we shared our thoughts on 2024, but what are VC's excited about in tech startups for the new year? There were a ton of predictions, so to make this easier, we scrapped as many predictions as we could, fed them into some Generative AI tools, and with some coaxing got the key VC’s themes below (and yes, there is a lot of AI in the list):
Multi-Modal AI Models: Integration of multi-modal retrieval and inference taking center stage in AI products, enabling expressive interactions, helping to usher a surge in enterprise adoption of AI with a diverse "multi-model" landscape.
AI Development Trends: Machines will generate over 50% of new global code by the end of 2024 leading to the biggest significant increase in developer productivity.
AI Agents: AI tools shifting focus to workflow integration and self-guided agents and away from text/chat-based UX for AI-native applications.
AI in Healthcare: Anticipation of breakthroughs in AI-driven healthcare, moving away from pure summarization to improving diagnostics and personalized treatments.
Open-Source AI: Rise of open-source Large Language Models (LLMs) fostering faster enterprise adoption of generative AI, leading enterprises to shift from Proof of Concept to production in 2024 for AI applications.
AI Virtual Assistants: Accelerating integration of AI virtual assistants for conversational interactions in both software and consumer hardware, leading to an AI software UX design "arms race" driven by rising competition to encourage mainstream adoption of AI.
Industry AI Startups: Revitalization of vertical SaaS with generative AI startups emerging to provide AI applications for biotech, climate, industrial, and supply chain sectors.
Quantum Computing: Anticipation of quantum computing breakthroughs in 2024 with practical demonstrations such as quantum sensors and advancements in quantum-proof security.
Availability of GPU’s: While a setback in 2023, expect real-time diffusion applications to be more efficient with model improvements and that “chiplets” become a more familiar concept.
You can read the full list of deduplicated predictions here if you are curious about specific.
Well we are in the new year and excited to launch a new series of posts here for our growing community that reached over 5,000 subscribers over the winter break!
Tech gets a jump on events from the beginning of the year with the massive CES (Consumer Electronics Show) in Las Vegas, but India is hot with the community activities! We received messages for submitting CFP’s for events like AWS Community Day Bengaluru in March. Meanwhile, tomorrow there the AWS Community Day Pune2024 DevSecOps and AWS Community Day Ahmedabad 2024 is on January 20!
What other community events are you tracking or helping to host in 2024? Let us know and we would be glad to post that here (and maybe even show up)!