With COVID-19 and a financial crisis having affected the bulk of the world for most of 2020, there has been a lot of discussion about the impact on small businesses and start-ups. These have included constant write-ups about the changing nature of the workplace, and how digitisation can save some operations. They have also involved some positive talk about how start-ups can thrive by innovating and seizing opportunities in a time of crisis (such as hiring top talent more easily). But another interesting aspect of all of this is that there are certain sectors in which start-ups may actually be poised to succeed specifically because of the crises we’ve faced.
The following are some areas in which new businesses may be able to excel, and in which start-ups yet to come will have a good chance when those in other sectors may struggle.
Telework
We just mentioned that there’s a lot of talk about the changing nature of the workplace, and much of this revolves around the notion of long-term teleworking sticking around in a post-COVID world. Certainly, some offices will go back to operating as usual (and indeed some already have). But telework is going to be vastly more popular for the foreseeable future, and may well represent the new normal of modern work.
Now, this can seem to be a space in which there’s already limited space for new companies. Tools like Zoom and Slack, as well as various programs provided by the likes of Google and Microsoft, are already generating a great deal of business. However, keep in mind that Zoom wasn’t anywhere near where it is now just a year ago, and there are plenty of more niche teleworking needs that need addressing as well. It’s undoubtedly a competitive space, but there’s little doubt we’ll continue to see new start-ups making it big.
Renewable Energy
Renewable energy already looked like a busy space for new start-ups heading into 2020. The events of the year to date have significantly improved the near-term prospects of renewables, however, largely because they’ve decimated the oil industry. Despite global efforts to protect crude oil after its once-in-a-generation crash earlier in the year, oil trade price trends make it clear that the industry is still struggling. In fact, troubling downturns in the oil price during September and, more severely, in October, are raising serious questions about a more long-term crash.
We already know that this trend in oil has led to a shift toward investment in renewables. Existing financial support fell less for clean energy than for oil, and there are strong indications that as we move forward more money will migrate from the former to the latter. And in any situation like this — with an increasingly outdated industry losing funding to an updated version — there is space for innovation and new start-up activity.
Personal Fitness
We don’t tend to talk about personal fitness as much as things like telework or the energy sector with regard to COVID-19. And yet, it’s a fairly major issue that all around the world people have had to change the ways they exercise (or forego exercise altogether). From large gym businesses, to local sporting leagues, to yoga studios and more, exercise-related facilities have shut down. As a result, people are seeking new ways to exercise without having to go to public facilities.
As you may well have heard, this shift has led to certain specific companies thriving. Peloton, for instance — a home fitness bike that pairs with a live training program — has seen a massive spike in sales. We also know that fitness app sales have skyrocketed, growing by nearly 50% in the first half of 2020 alone. As with telework though, a few thriving companies and apps don’t mean that new start-ups can’t work their way in. There is limitless potential in personal fitness, and we expect to see a great deal of post-COVID innovation in the category.
Gaming
Gaming could just about always make it onto a list like this. There’s never really a slow demand for new games, particularly when the consoles and various mediums we play them on just keep improving. However, demand for gaming has increased particularly rapidly during the COVID-19 crisis, with some surveys indicating that more than 30% of gamers say they’re playing more now than they were before.
This doesn’t necessarily mean that engagement will remain unusually high. But the fact is people are gaming enough right now to become more attached to the industry. Avid gamers are finding new games to explore; casual gamer are becoming more enthusiastic; and some who haven’t ever spent much time gaming may now be doing so. These trends should all result in more business for an industry that’s constantly growing and innovating to begin with. There will be plenty of room for new, successful star-ups in gaming.
There are other industries, too, that look to have room for post-COVID innovation. But these four are certainly some of the ones that stand out most.
