CLOUD WARS: The Empires Strike Back In 2015:u00a0 The cloud computing wars started years ago, but, largely speaking, Amazonu00a0has been uncontested and has quietly become the dominant player in theu00a0space. In 2015, Amazon will face a multi-front war as Google will launchu00a0its assault on Amazonu2019s traditionally strong presence in the developeru00a0ecosystem, and Microsoft will combat Amazon in the enterprise market byu00a0re-doubling its efforts on Azure.nnLEGACY TITANICS: Icebergs Ahead In 2015: We will see more u201cunbundlingu201d of legacy software companies. Theu00a0disruptive forces that have pushed HP and Symantec to break up theiru00a0operations in order to compete with new entrants will accelerate asu00a0activist investors and private equity owners push to maximize the value ofu00a0these existing assets. Look for significant moves from Microsoft, EMC,u00a0VMware, Citrix, and Dell in the next year.”Image Credits:NEA (opens in a new window)Jules Maltz -u00a0The IPO Market: The IPO market will stay open, but a large number of tech companies will price their IPOs belowu00a0the price of their last private financings. Sandy Miller -u00a0Tech IPOs: I think 2015 will be the best year since the u2018bubbleu2019 for venture-backed tech IPOs. We have hadu00a0a solid year in 2014 and the deals late this year are working well. There is considerableu00a0institutional investor appetite; they have made good returns on tech IPOs this year. Mostu00a0importantly, there are an unprecedented number of high-quality, private, venture-backed techu00a0companies of real scale ($50 million or more in annual revenues) and growth (30-50 percent top-lineu00a0growth).”2014 certainly was a year of big ideas that fizzled. The Promise of Payments: Despite heightened focus, increased investment dollars and strongu00a0media buzz around a revolution in the payments space, there has been relatively little tangibleu00a0change in the way we pay for things. NFC payment hasnu2019t taken off despite the introduction ofu00a0Apple Pay, POS integrations are incredibly fragmented and interchange fees are being drivenu00a0toward zero. Wearables Werenu2019t Quite Ready: There was much excitement around wearable technology,u00a0but practical usage isnu2019t quite there so adoption has been low. While there were some notableu00a0product releases, wide-spread adoption and everyday use is still not at hand. For that tou00a0happen, creators need to figure out use cases and applications that genuinely simplify everydayu00a0tasks, rather than complicate them. 2015 will feature greater entrepreneurial enablement. For example: Bigger, Better Deals: With a 21 percent decline in funds but a 40 percent increase in dollars raised, we areu00a0seeing larger funds spread across fewer firms. In 2015 we can expect to see the average dealu00a0size increase with an uptick in later growth rounds. Tech Enablement Creates More Entrepreneurs: Real-time and mobile services haveu00a0empowered a new segment of workforce that thrives on flexible and independent work. This hasu00a0enabled those that arenu2019t able to (or simply donu2019t want to) fulfill 9-5 jobs to enter the workforceu00a0and creates a prevalence of non-traditional careers in services. In 2014 in the U.S. alone, thereu00a0are 18 million independent workers. Expect that number to increase at sharp rates in 2015. Government Empowers & Creates Even More Entrepreneurs:u00a02014 saw changes in policy thatu00a0enable the entrepreneur with greater independence and freedom. More lenient immigrationu00a0policies will allow people to pursue entrepreneurship, while affordable individual healthu00a0care makes traditional employment less of a draw. These policy changes will drive a massiveu00a0influx of entrepreneurs in 2015 and beyond.”Steve Herrod on the Enterprise -u00a0Deconstruction Of Traditional IT Applications:u00a0Independent of whether this will be driven by startups or by Google, there will be a shiftu00a0in how and where companies do business in the future leveraging SaaS models andu00a0moving away from the stranglehold of traditional ENT software vendors like Microsoft, Oracle, SAP and others. Network Virtualization:u00a0Virtualization will continue to rise in popularity and finally take the main stageu00a0in networking u2013 we have seen this starting to take place with the acquisition of Nicira andu00a0ACE. There Will Beu00a0Hacks: As we move into 2015, security breaches will continue tou00a0happen as companies work to patch holes in current software and networks. Trying tou00a0stay one step ahead of hackers with the latest software or security features isnu2019t going tou00a0be enough; companies will need to work together in order to combat and fight them off. Neil Sequeira On Consumer Tech —u00a0The End Of The ‘Superstore’ In Verticals:u00a0First it was Circuit City, then Radio Shack,u00a0followed by Best Buy. There is still a place for Walmart and grocery stores but notu00a0vertical players in alternative commerce. That is were the web and mobile win. Withu00a0companies like The Honest Company, there will be a rise of vertical commerce with au00a0unique connection to the customer directly. The Downside To Consolidation And Failure Of Media Properties:u00a0Consumers realize thatu00a0this isnu2019t a good thing — AT&T plus Direct TV, Comcast plus Time Warner Cable. The feweru00a0people there are to compete on the price of cable, phone and, most importantly, high-speed data, as well asu00a0provide thoughtful journalistic integrity is a concern and the consumers will realizeu00a0this in 2015.”New Enterprise Trend in 2015: Labor and Workforce Innovation:u00a0Until a decade ago, machine learning (ML) and artificial intelligence (AI) were relegated to research labs, technical publications, and big-budget science fiction films. ML and AL have u201ccrossed the chasmu201d and will have a profound impact on the way businessesu00a0work. Pairing human workers with machine learning and automation will transform knowledge worku00a0and unleash new levels of human productivity and creativity. Without the advances in automation, the swelling volume of data would overwhelm knowledgeu00a0workers and cripple businesses. A New Era in Retail and Commerce Innovation:u00a0The traditional retail infrastructure and supply chain logistics as we know it is being disrupted byu00a0companies creating new technology platforms and data-enabled distribution systems that haveu00a0predictive analytics, better customer profiling, deeper consumer engagement, blended onlineu00a0and offline data, and more agile supply chains. The supply-chain has been fragmented and inefficient for years, particularity with the delivery ofu00a0heavyweight goods to the consumer, which until now have been expensive and complex. E-commerce platforms are being transformed for the consumer and the manufacturer byu00a0leveraging powerful analytics and forecasting tools helping to alleviate “last mile” (i.e. fromu00a0warehouse to consumer) problem that is the key logistics issue – where most of the cost,u00a0complexity and fragmentation lies, especially with the delivery of heavyweight items. Life Tech Will Take on New Life in 2015:u00a0In life, time really is money, and a major source of time is spent on home and family tasks. Life tech allowsu00a0digitally-enabled services, intelligent personal agents and mobile-device-enabled communication and collaboration infrastructure to truly optimize consumers’ lives. Similar to how ERP helped to organize the business side of our lives, life tech promises tou00a0organize the personal side of our lives In addition to companies like Nest. Other companies, such as TicketFly and Ruby Ribbon, haveu00a0products and services that optimize, personalize and automate our lives as consumers and areu00a0creating a smart world that shifts and responds to our needs.”
From cloud wars to the certainty that there will be hacks, venture capitalists believe that 2015 will be a year of tumult and (in public markets anyway) triumph for the startup world.
Here are the visions that the general partners, managing directors and partners from firms such as NEA, IVP, Cue Ball Group, General Catalyst Partners and MDV have when they gaze into their crystal balls.
Together these firms have more than $22 billion under management, so they’re not only seeing the future, they’re often shaping it.
