What’s Hot (and Not) – All You Need To Know About Tech Trends
There are many ways to get a pulse on the startup scene to see what is trending. For example, one could look at the sub-sectors getting the most money from venture capitalists (vc). The more deals and money hitting a sub-sector, the more it could be on its way up.
However, perhaps there is another angle that can tell us something: the change in mentions of tech keywords between 2015 and 2016 in vc-applications from startup -entrepreneurs. And the results are astounding. One keyword is being mentioned 850% more – and it really helps show what entrepreneurs are thinking.
YCombinator.com is arguably the most prominent startup accelerator on the planet. Since 2005, they’ve funded over 1000 startups. Every year, Y Combinator sifts through thousands of applications from entrepreneurs. To find out more about trends, Y Combinator commissioned the data-studio of Priceonomics.com to analyze 8 years worth of anonymized application data. After breaking the applications down into keywords, they calculated the percentage of applicants that mentioned any given term.
Using the above subjective methodology, here are the increases and decreases over the last year that stood out the most:
The word “Slack” was used 850% more often in 2016 applications, clearly related to the popular workplace collaboration tool of the same name.
The explosive growth of Slack.com (‘A messaging app for teams who put robots on Mars’) has rippled through the startup world, likely inspiring an army of potential competitors and collaborators in the wake of their success. Slack already had 8-10 acquisition offers last year and in spring of 2016 Microsoft eyed Slack as a potential acquisition target for as much as 8 billion USD.
Other emerging trends that picked up steam in recent applications: virtual reality (“VR”), artificial intelligence (“AI”), internet of things (“IoT”), and “drones”. The 119% increase in the usage of the word “bills” also points to the recent attention on the fintech space.
The mention of “SaaS” (Software as a Service) also increased 52%, as it has become a preferred business model by venture capitalists.
… And What’s Not
What’s the largest decrease? “Bitcoin”, which dropped 62% from one year to the next. The cryptocurrency has been a popular developer target for years, but the rush to take it mainstream may now be losing steam.
The word “nonprofit” was also used 29% less, which may point to the recent pressure for startups to offer a more foreseeable potential return on investment for investors. The ecosystem isn’t as frothy as it once was, and nonprofit ideas may have taken a temporary tumble as a result. “Crowdfunding” has also dropped more off the radar, receiving 25% less mentions.
For more information, go to Y Combinator’s The Macro blog, which in the post “Reading applications to Y Combinator is like having access to a crystal ball” discusses many of these trends over the course of years in great detail.