Predictions of 2024 for Early Stage Startups and Investors!

Here are the top 5 predictions of 2024 for early stage startups. Startups that have not raised any capital and are operating without Product Market Fit

1. Specialist money will be available- Grants and pre-seed/accelerator capital for very specific verticals (not hype verticals) will be available. Cybersecurity, Legal, Compliance, Greentech, Energy Sustainability and Food will have a good outlook. AI will have a hype curve, but overall startups providing AI infrastructure will start slow but do well. Startups relying heavily on APIs and OpenAI for their product, will have a good start but will not be able to manage supplier and information risk.
2. Things will get harder– From money to hiring, to testing and selling will become harder as the industry reduces its appetite for risk. Hiring will be a twin edged knife as the market will flood with folks being let go, but will not want to work for “equity and no money”. This would be a good time for government employment incentives and grants to be made available, like some governments did for investors.
3. Pick better problems- One thing that will help is clarity in problems, and making sure they are worth solving. The days of incremental or behavioural changing solutions are gone, and won’t return for another 3 years. Everyone from investors, to employees are now keen to look for high pain, high opportunity problems that have been validated.
4. Plan to Scale– While quite evident, Scale vision will be very important. Investors and potential hires will look at less risky longer term visions to invest their time and money in. The days of an idea are on hiatus at the moment. Build small, communicate big is the key. And this is something we don’t see. Knowing how to communicate this in a very simple way is the difference between that investment and not. Also showing and planning for scale means startups are left with less technical debt for when it comes to really growing big and fast.
5. Trends- Trends will be able to destroy your business and the assumptions you have. With AI, you’ll have phantom expectations. Everyone will want to do everything with it, and ReAI will not solve all the problems. Businesses will expect to have an AI strategy (usually something superficial and unproven). So as a startup you need to show trends in your plans, but build with proven solutions to the problems and not trends. Remember, unless you have inside expertise, you will always play catch up and with limited resources, you will always compete unfairly. So with trends, tread carefully.