Smart employers rely on Sage accounting solutions to take care of their accounting needs, so that they can take care of their
employees. Find out more about how our accounting systems can help your business, today.
As we reflect on some of the most standout success stories from the startup scene in 2017, an inspirational picture emerges for the future entrepreneurs of 2018.
Not just for those confined to world class labs, top tier universities, and technical minds tinkering with code; but also looking to how low-cost and accessible technologies are being harnessed by creative and ambitious minds in Nairobi, Kenya; Gurgaon, Northern India; and Azerbaijan.
Collaboration is the buzzword for 2018, and the world is getting smaller. Startup Europe Comes to Africa (SEC2A) held their launch event in Brussels in November 2017, backed by The European Commission, to advance entrepreneurship between the two continents. The campaign hopes to create opportunities for digital trade, and open doors to greater investment opportunities on both sides. This is just one example of the many collaborations happening around the world to connect entrepreneurs with potential investors in more wealthy territories.
Here is our pick of the most interesting, and inspiring trends to look out for in the global startup scene this year.
Money goes even more mobile
Traditional banking has seen a radical shift in 2017, with millions around the world adopting new borderless, app-based mobile bank accounts. Moving their money away from traditional corporate banks, and entrusting a new wave of fintech startups with their funds.
In the words of Dave Mitchell, President of NYMBUS, “Millenials want to bank wherever they want and whenever they want, which does not align with the traditional banking model… in essence, your wallet will be your phone.”
The two most notable examples are Revolut and Monzo. Both allow low-to-zero international withdrawal fees, free payments via chip and pin in 130 currencies, and you can open an account online in minutes via a secure online ID check.
In late 2017, Revolut launched a new service to account holders, allowing them to buy the three most popular cryptocurrencies, (Bitcoin, Ether and Litecoin), directly via the app in 25 currencies. This sector is evolving fast, and with frontrunner Revolut now taking on cryptocurrency trader apps, they clearly have big ambitions for the future.
Meanwhile in Africa…
While millions in the western world are turning their backs on formal banking institutions, nearly 80% of adults in the African continent have never had access to formal banking
. This is the highest ratio of unbanked people in the world. On the other hand, smartphone usage is growing at a rapid pace. It is predicted that in the next three years, there will be over 300 million more smartphones in use in sub-Saharan Africa (Global Finance Magazine, 2017).
This presents a unique, and also huge opportunity for fintech startups in Africa. Many people in this continent are skipping traditional banking altogether and going from cash, straight to mobile banking. In the beginning of 2017, there were already 277 million registered mobile-money accounts in sub-Saharan Africa, compared to only 10 million in Europe and Central Asia combined (Elixirr Partners).
With the lack of formal banking presence, the majority of mobile banking innovation is coming from the telecoms sector. Backed by Vodafone, the most popular mobile wallet in Kenya ‘M-Pesa’ has processed transactions equal to 50% Kenya’s GDP. Zoona, a South African startup has processed transactions over $1billion through its mobile wallet product.
The growing issue now is that people find their mobile banking is tied to their telecoms provider, highlighting a big opportunity in the region for more independent mobile banking providers.
ARTIFICIAL INTELLIGENCE (AI)
Chatbots evolve with advances in Conversational Intelligence (CI)
As we reported in 2017, the practical applications for AI in business are reaching mass market on a grand scale. Like our very own Chatbot Pegg, the world’s first accounting chatbot, any small business owner or entrepreneur now has affordable access to AI that works within their existing smartphone technology. AI plugins to help you with anything from recording and tracking expenses, (Pegg), automatically responding to customer inquiries, (Nanorep), and even template-based ‘bot builders’ so you can create your own Chatbot, (MEOKAY).
2018 will see these text-based applications being used by more companies, and in more industries around the world. They will very quickly become the norm. Expect to be talking to a bot next time you book a flight, or ask if they have that top left in your size.
Some Chatbot applications and Virtual Assistants claim to be so intelligent, that they can hold a full dialogue with a customer, responding with intelligent questions, and useful information, converting cold contact with prospective clients into sales. Conversica claims to achieve an average of 35% response when used for new business lead generation, that’s quite the result if you compare it to your part-time assistant sending out cold emails.
But it’s a double-edged sword…
With advances in Conversational Intelligence, also arises advances in technology used for fraud. Some leading financial institutions are claiming a loss of tens of millions of dollars annually from unprecedented levels of phone fraud, (Business Insider
). The CI is so advanced, customers don’t know if they are talking to a fraudulent Chatbot, or a real representative from their bank.
Pindrop is one standout startup from 2017 that is tackling this problem. Named by Business Insider as one of 50 startups they predict to boom in 2018, this IT programme is already being used by call centres to analyse the voices of each caller. It’s able to determine whether the voice on the other end of the line is real, or generated by a computer.
Humans can no longer tell the difference.
eCommerce tools bridge old-world farmers with new-world customers
Entrepreneur reports that ‘2018 may finally be the year ecommerce overtakes retail once and for all’. With Forrester finding that 83% of adults in the US purchased something on Amazon in 2017.
But that’s not news to any of us. A little dig into how ecommerce technologies are supporting startups in the agritech arena, and there have been some exciting developments in 2017.
As technology reaches more remote communities around the world, the adaptive and bright-eyed youth are adopting mobile and internet based technology to make their lives easier. But what about the elders who still work away in the fields, far away from apps, and ‘click to buy’.
Easy to build, and with low setup costs, template-based eCommerce platforms such as WixStores and Shopify can be used by any ambitious entrepreneur with a great idea, and no coding knowledge is needed.
Launched in early 2017 by 23-year old Anu Meena in Gurgaon, Northern India, AgroWave is on a mission to transform farmers' lives by incorporating technology in the fruits & vegetable supply chain. With an app in the pipeline for 2018, the business uses simple ecommerce tools to connect rural Indian farmers directly with businesses, cutting out middle-agents and allowing a higher price to be paid to farmers for quality produce.
From a small rural village herself, Anu Meena watched her farmer grandfather struggle to sell his produce for a fair price, nurturing the seed for her business idea.
Image Credit: AgroWave
is a similar business launched in Bali, Indonesia, in 2017. A simple eCommerce shop built in WixStores has allowed a local family to create a successful online delivery service, procuring organic produce from multiple rural farms on the island, and selling direct to customers at profit, including a door-to-door delivery service.
These are simple business ideas, harnessing the latest in affordable eCommerce technology to support local rural farmers. And in the case of AgroWave, they have already gained seed funding and grown to procure produce from four rural regions, turning over 50,000 Indian Rupees per day, (that’s equivalent to US$790).
In India, an estimate 60% of rural Indian households make their living from agriculture, the second-largest agricultural land in the world. This creates a huge opportunity for agritech startups in this region.
Agritech startups in agricultural land are scalable, easily transplantable to multiple markets, and a top trend to watch out for in 2018.
THE UBER EFFECT
GPS technology used to tackle challenges in developing cities
Many tech startups in recent years have made the world a smaller place, connecting service providers with customers in both the real, and digital world. Uber connects drivers to passengers. Egyptian startup Tutorama connects tutors with students in their local area, allowing parents to monitor their children’s progress online. GoFood connects hungry customers with all their local restaurants who provide a take-out service in Indonesia.
In 2017, we saw some exciting new startups taking the Uber concept, and harnessing this technology to tackle local challenges.
One such startup is Flare, dubbed the ‘Uber for emergencies’ in Kenya. The app connects users with the nearest ambulance service using the same GPS technology as Uber, reducing response time and ultimately saving lives.
In Nairobi alone, there are up to 50 different emergency service numbers to call for an ambulance, most of which are run by private companies. It would be normal to wait up to 2 hours for an ambulance to arrive, if not longer. Flare has taken this well tested technology to create a more central line of contact between patients in need, and the nearest available ambulance.
While the business started out focused on health emergencies, they have now expanded their fleet from 50 independent ambulances, with the addition of 10 fire trucks to respond to fire emergencies. They have also expanded from their original test location in Nairobi, Kenya, to neighbouring countries in East Africa.
In South-East Asia, Uber competitor ‘Grab’ has launched GrabHitch, an app which allows scooter drivers to offer passengers lifts on their motorbikes, making them a little extra cash, and offering passengers a more accountable service to book a cheap ride, rather than jump on the nearest unlicensed tuk-tuk.
In India, where tuk-tuks (rickshaws) make up 20% of motorised trips in cities, there is a surge in local startups launching apps to monetise the street-side hail. And in July 2017, India’s Minister for Transport announced that the government are investing in their own lift-hailing app to tackle the need for mobility and greater accountability in the country’s many overpopulated cities.
In Sub-Saharan Africa especially, where smartphone usage, and internet access is growing at a rapid pace, this is one region to watch for new startups using GPS technology to connect services with customers in many industries.
Environmental challenges push innovation in startups
In the US alone, reports suggest that employment in solar and wind-powered energy is growing twelve times faster than the entire US economy. And that 46% of large American businesses have recruited new staff to address sustainability in the past two years. So if not only for the health of the planet, the sustainability movement is certainly healthy for employment opportunities.
Surprise innovations in renewable energies are also coming from the most unexpected regions. Like 15-year-old Reyhan Camalova from Azerbaijan, who was the youngest female entrepreneur to participate at the Global Entrepreneurship Summit 2017. She founded ‘Rainergy’, a sustainable solution that converts rainwater into electricity.
And HiGi Energy, a Philippines-based startup that converts water hyacinth, an indigenous aquatic plant (locally considered a pest!), into a clean fuel to light cooking fires. In a country that still depends heavily on charcoal and firewood for cooking fuel, replacing these resources with what is locally considered a weed, is a great step towards reducing deforestation in these areas.
A different kind of green business…
Worth an honourable mention, the recent decimalisation of marijuana in South Africa and several US States is creating a new market of opportunities for ambitious entrepreneurs.
Quick to meet the demand of law enforcement, who now need to regulate THC (the psychoactive property of marijuana used for recreational drug use) levels in drivers, Hounds Lab has secured US$8.1million investment to launch the first ever THC breathalyzer gadget. The gadget is able to measure levels of THC, and also alcohol levels, present in drivers on the roadside.
And it’s not only marijuana in a recreational drug context that is creating opportunities. Hemp, a sustainable material taken from a different strain of the Cannabis Sativa plant is seeing a phenomenal increase in demand worldwide. Used as a clean cooking oil, a health food ingredient in baking, and also as a thread to weave more sustainably produced clothing, demand for hemp-based products rose by 63% in Western Europe last year.