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Global Technology Trends & Top Ten Startup Hubs 2017


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Update report that provides an overview of general technology trends, global venture capital trends, and startup trends around the world. Snapshots of the top 10 startup hubs in the world: Silicon Valley, NYC, London, Stockholm, Shanghai, Tel Aviv, Beijing, Seoul, Boston, and Los Angeles.

Published in: Technology

Global Technology Trends & Top Ten Startup Hubs 2017

  1. 1. • General Technology Trends • Mobile Industry Trends • Investment Trends • Top Ten Startup Hubs 2017 CONTENT
  2. 2. Global Technology Trends
  3. 3. Asia’s Rapidly Rising Middle Class The global middle class is expected to grow to 4.9 billion people by 2030 and two- thirds will be in Asia. OECD defines “middle class” as households that spend $10- $100 per person each day. In 2009, there were 1.8 billion people in this middle class.
  4. 4. Continued Domination by “Big Five” in Tech PWC’s Strategy& analyzes a “Big Five” in tech: Alphabet (Google),Amazon, Apple, Facebook, and Microsoft: “Just since 2011, these companies have grown revenues by US$287 billion, while, taken together, the Next 20 have seen their revenues shrink.When it comes to enterprise value, the contrast is even more dramatic: In that period, the Big Five created more than $1.5 trillion in enterprise value, while the Next 20 combined created only a third of that. ”
  5. 5. Continued Domination by “Big Five” in Tech “The Big Five continually reinvest much of their profit in research and development. Together, they have averaged $44 billion per year in innovation spending since 2011. In fact, they represented five of the top 11 spenders on R&D in 2016 across all industries.” - PwC’s Strategy&
  6. 6. AI Global Revenues 2017 International Data Corporation (IDC) states that revenues for AI (artificial intelligence) across the globe will reach $12.5 billion in 2017, which is a 59% increase over 2016. Corporate investment should grow over the next several years with a compound annual growth rate (CAGR) of 54.4% through 2020 with AI spend hitting more than $46 billion. IDC projects that consulting services attached AI implementations will hit $3.5 billion in 2017 along with $1.9 billion spent on related hardware.
  7. 7. AI Global Revenues 2017
  8. 8. Worldwide IT Spending Forecast Overall worldwide IT spending is projected to increase by 2.4% to $3.477 trillion.The largest growth sector is enterprise software with a 7.6% increase over 2016 to $351 billion. In 2018, this growth continues to increase by 3.5% in the overall sector to $3.598 trillion. 2016 2017 2018 Source: Gartner in $ billions of dollars
  9. 9. Mobile Industry Trends
  10. 10. The Worldwide shipments of PCs, tablets and smartphones are predicted to exceed 2.35 billion units in 2018 from 2.3 billion units, an increase of 2.0 percent from 2017, according to Gartner, Inc.This would be the highest year-over-year growth since 2015. Global Smartphone Shipments (in billions) Global Smartphone Shipments (in billions) Source: BI Intelligence, SparkLabs Global Source: BI Intelligence, SparkLabs Global 0 1 2 3 4 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E Smartphone Market Rebounds in 2018
  11. 11. Global Connections by Technology (in millions) Smartphone Users and Penetration Worldwide (in millions) Smartphone Penetration by Country (Top 10) Smartphone Shipments by Region (in billions) Source: GSMA Intelligence, Google our mobile planet, SparkLabs Global Source: eMarketer, CCS Insight, SparkLabs Global 0 2000 4000 6000 8000 10000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2G 3G 4G 1311.2 1639 1914.6 2155 2380 2561.8 32.4 38.4 42.9 46.4 49.5 51.7 34.3 25 16.8 12.6 10.4 7.6 0 20 40 60 80 100 0 500 1000 1500 2000 2500 3000 2013 2014 2015 2016 2017 2018 Smartphone Users % of Mobile Phone Users % Change 67% 68% 68% 69% 70% 72% 74% 75% 80% 85% 0% 20% 40% 60% 80% 100% Taiwan Norway UK Denmark China Spain Hong Kong Sweden South Korea Singapore 0 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 1.8 2 2012 2013 2014 2015 2016 2017 2018 North America Western Europe Asia-Pacific Developed Asia-Pacific Emerging China India Eastern Europe Middle East and Africa Latin America Smartphone Market in 2017
  12. 12. Regional Share of Smart Devices and Connections Global Growth of Smart Mobile Devices and Connections Source: Cisco VNI Mobile, SparkLabs Global Source: Cisco VNI Mobile, SparkLabs Global 74% 59%43% 35% 34% 12% North America Western Europe Central and Eastern Europe Asia Pacific Latin America Middle East and Africa • By the end of 2020, North America will have 95 percent of its installed base converted to smart devices and connections, followed by Western Europe with 86 percent smart devices and connections. • The share of smart devices and connections as a percentage of the total will increase from 36 percent in 2015 to more than two-thirds, at 67 percent, by 2020, growing nearly threefold during the forecast period 64% 56% 49% 43% 37% 33% 36% 44% 51% 57% 63% 67% 0% 20% 40% 60% 80% 100% 2015 2016E 2017E 2018E 2019E 2020E Nonsmart Devices Smart Devices Smartphone Market in 2017
  13. 13. Source: IDC Smartphone Market in 2017 23% 15% 10% 7% 5% 40% Samsung Apple Huawei OPPO vivo Others Worldwide Smartphone Shipments Market Share Q1 2017 Samsung and Apple's market share remained the same while Huawei, OPPO and vivo all increased by 20% or greater. Samsung’s 23% market share equated to 79.2 million smartphones shipped out in Q1 2017. Apple’s 15% market share meant 51.6 million smartphones, and Huawei’s 10% meant 34.2 million smartphones.
  14. 14. Investment Trends
  15. 15. “Entrepreneurship ecosystems are developing all over the globe – but no place is like Silicon Valley where ideas, ambitions, capital and experience still come together in a unique, catalytic way that fosters the creation of exceptional startups.” Jeff Clavier, Founder & Managing Partner of Uncorked Capital On Silicon Valley Uncorked Capital (formerly SoftTech VC) is one of the original seed VC firms in Silicon Valley, having closed 175+ investments since 2004. Jeff and his team have backed successful startups like Mint , Kongregate, Milo, Wildfire, Fitbit, Eventbrite, Sendgrid, Postmates, and others.
  16. 16. Asia Overtakes U.S. in VC funding For the first time,Asia overtook the U.S. in total venture capital invested during Q2 2017. $19.3 billion was invested in Asian companies while in the U.S. $18.4 billion. Source: PwC / CB Insights MoneyTree™ Report Q2 2017
  17. 17. China Leads Q3 2017 VC Deals Five out of the top ten largest venture capital deals in Q3 2017 were from China with 4 from Beijing and 1 Shanghai. This included US$2 billion raised by Toutiao (content aggregation platform) and US$1.6 billion raised BAIC BJEV (electric vehicles).
  18. 18. ICOs vs VCs
  19. 19. Public Blockchain Assets Outperform All Others
  20. 20. AR/VR funding continued to increase in 2017. The VR Fund reported that there was a 79% increase in funding over the same period last year. So far in 2017, total investment across the globe as hit $2.3 billion. AR/VR Funding Growth Continues in 2017
  21. 21. Startup Survival Rate From Round To Round Bay Area vs. U.S. Average New York City vs. U.S. Average Boston vs. U.S. Average Los Angeles vs. U.S. Average Source: Mattermark, SparkLabs Global Source: Mattermark, SparkLabs Global 0% 25% 50% 75% 100% Seed A B C D E F USA Average New York City Series 0% 25% 50% 75% 100% Seed A B C D E F USA Average Bay Area Series 0% 25% 50% 75% 100% Seed A B C D E F USA Average Boston Series 0% 25% 50% 75% 100% Seed A B C D E F USA Average Los Angeles Series
  22. 22. Startup Survival Rate From Round To Round Seattle vs. U.S. Average Chicago vs. U.S. Average All Other Cities vs. U.S. Average Source: Mattermark, SparkLabs Global Source: Mattermark, SparkLabs Global 0% 25% 50% 75% 100% Seed A B C D E F USA Average Seattle Series 0% 25% 50% 75% 100% Seed A B C D E F ~Other~ USA_Average 0% 25% 50% 75% 100% Seed A B C D E F Chicago USA_Average Series
  23. 23. Top Ten Startup Hubs 2017
  24. 24. Silicon Valley New York London Shanghai Stockholm Seoul Tel Aviv Beijing Los Angeles Boston Top Ten Startup Hubs 2017
  25. 25. What defines a leading global startup hub? • Engineering Talent • Entrepreneurs / Mentors • Technical Infrastructure • Funding Ecosystem & Exits • Startup Culture • Legal & Policy Infrastructure • Economic Foundation • Government Policies & Programs Top Ten Startup Hubs 2017
  26. 26. Population of Top 10 Global Startup Hubs * population by metro area Top Ten Startup Hubs 2017 A view of San Fransokyo from Disney's 'Big Hero 6' Image Credit: Walt Disney Animation Studios 1. Silicon Valley 7.4 Million 2. Tel Aviv 3.4 Million 2. Beijing 24.9 Million 4. Stockholm 2.1 Million 4. Los Angeles 18.7 Million 6. New York City 20.2 Million 7. Shanghai 34 million 7. Seoul 25.7 Million 9. Boston 8 Million 10. London 13.6 Million We welcome Shanghai as a new member!
  27. 27. Unicorns of Top 10 Global Startup Hubs Our definition of a “unicorn” was: • Private company valuation of $1 billion+ • Private company acquired for $1 billion+ • IPOed during 2010 to present with a current market capitalization of $1 billion or greater (Sources: CB Insights, Crunchbase, Yahoo! Finance, and Google) 1. Silicon Valley 56 Unicorns 2. Beijing 25 Unicorns 2. Tel Aviv 3 Unicorns 4. Stockholm 3 Unicorns 4. Los Angeles 11 Unicorns 6. New York City 15 Unicorns 7. Shanghai 13 Unicorns 7. Seoul 4 Unicorns 9. Boston 6 Unicorns 10. London 9 Unicorns Top Ten Startup Hubs 2017
  28. 28. “Silicon Valley is the best place in the world to scale a startup. Once a startup hits product-market-fit, it should absolutely have a presence in the Valley to benefit from the knowledge and resources about scaling.” Ben Casnocha, Silicon Valley-based entrepreneur and author On Silicon Valley Ben is Co-author of the #1 New York Times bestselling career strategy book “The Start-Up of You: Adapt to the Future” (with Reid Hoffman). At 14, he was Founder of Comcate, an e- government technology firm.
  29. 29. 30 Unicorn Startups who went public (IPO) SILICON VALLEY Pandora   Trulia     Palo  Alto  Networks     Infoblox Lending  Club     Hortonworks     Linkedin Facebook     ServiceNow Marketo Zendesk Fitbit     Fusion-­io Workday     Exact  Target     Fireeye GoPro     Nutanix Zynga     Splunk Guidewire  Software     Box     New  Relic     Unicorn  Startups  that  went  public
  30. 30. 56 More Unicorn Startups in Silicon Valley (non-IPO) SILICON VALLEY Uber Airbnb Apttus Slack Automattic AppDynamics Credit   Karma Github Docker Zscaler Lyft Palantir Technologies Intarcia Therapeutics Bloom   Energy Deem Kabam Jawbone Instacart 23andMe Wish Prosper Pinterest Stripe Houzz Good   Technology   Illumio Pure   Storage MuleSoft CloudFlare ForeScout Tanium Dropbox Zenefits Survey Monkey Proteus   Digital  Health MarkLogic DocuSign Deem EventBrite Glassdoor NextDoor Theranos Cloudera Evernote Tango Coupa Software ContextLogicMedallia Lookout Others… Entire  list  of  Unicorn  Startups  that  hasn’t  gone  public
  31. 31. “Silicon Valley isn't just a place, it's a state of mind. A state of mind where failure is okay, where risk taking is celebrated, where young people are seen as thought leaders, and where folks try to help each other with no expectation of anything in return.” Sheel Tyle, Co-founder & CEO of Amplo On Silicon Valley Sheel focuses on consumer technology & education in the U.S. and emerging markets. Sheel holds board seats or observer roles with Andela (independent), LearnUp, and Robinhood. He is a World Economic Forum Global Shaper.
  32. 32. Startup Snapshot of Silicon Valley SILICON VALLEY
  33. 33. “Los Angeles occupies a unique position as the center of the global entertainment industry. Companies who want access to content, talent and media knowledge are all locating offices here. Los Angeles also has a rich set of experienced entrepreneurs, angel investors and venture capital that can help new companies scale and grow.” Sam Wick, Head of UTA Ventures On Los Angeles Sam is currently Head of UTA Ventures. Previously he was EVP & GM, Enterprise at Maker Studios, which was acquired by Disney in 2014.
  34. 34. LOS ANGELES 11 Unicorn Startups in Los Angeles
  35. 35. Startup Snapshot of Los Angeles LOS ANGELES
  36. 36. “NYC is one of the fastest growing ecosystems for tech startups.There's a tight-knit community of founders, investors and talent from around the world - not to mention one of the most diverse melting pots of people from all walks of life. It's a unique place to launch new products to a high concentration of early adopters, both consumer and enterprise.” Suzanne Xie, Founder & CEO of Hullabalu On NYC Suzanne is Founder of Hullabalu, a family media startup re-inventing storytelling for the new generation. Hullabalu's story apps have been installed over 1.4M times and is a #1 iTunes Books bestseller in over 42 countries. Investors include SV Angel, 645 Ventures, Melo7 Tech, Joanne Wilson, SparkLabs Global Ventures and others.
  37. 37. NEW YORK CITY 15 Unicorn Startups in New York City
  38. 38. Startup Snapshot of Silicon Alley NEW YORK CITY
  39. 39. "London has a unique combination where in one single city there is strong concentration of deep technical talent alongside people with business experience across multiple sectors and it's also the seat of government and regulation. For the new wave of startups coming up that are tackling real world issues, it's an ideal starting ground to coordinate across all these domains.” Aneesh Varma, Co-founder & CEO of Aire On London Aire gives people a new credit score to help them qualify for essential financial products. The company’s investors include White Star Capital, Sunstone Capital, TechStars/Barclays Accelerator, and SparkLabs Global Ventures.
  40. 40. LONDON 9 Unicorn Startups in London
  41. 41. “Despite the public perception on Brexit, the UK and London continues to be the leading driver of the European tech ecosystem. Digital comprises the highest % of GDP out of any OECD country and both the founder and funder ecosystem continues to accelerate. It is a natural hub for FinTech given its centrality for global finance, for AdTech given a number of the largest media buying groups are UK based, and for AI given the PhD outputs from the likes of Cambridge, Oxford, UCL and Imperial. Most importantly its founder and employee base is one of the most vibrantly diverse in the world.” Christian Hernandez, Co-founder & Managing Partner of White Star Capital On London White Star Capital is an early-stage VC firm helping entrepreneurs across the Atlantic. Their investments include companies such as Betaworks (US), Summly (UK – Bought by Yahoo!), and Dollar Shave Club (US).
  42. 42. Startup Snapshot of London LONDON
  43. 43. “Beijing is great for startups because it's not only the center for tech, business, politics and culture in China, but also has a large early adoption market for new technology and consumer trends.The city is littered with co-working spaces and events for startups.VCs are hungry to invest in great companies. Besides Silicon Valley, Beijing is the next most vibrant place for startups.” Anna Fang, CEO & Partner of ZhenFund On Beijing Anna is Head of the largest seed fund in China with over $500 million AUM. Since starting the fund in 2011 with Xu Xiaoping, Anna has managed the fund’s over 300 early stage investments.
  44. 44. BEIJING 25 Unicorn Startups in Beijing
  45. 45. Startup Snapshot of Beijing BEIJING Kaixin001 Tujia Edaixi
  46. 46. “The Stockholm startup ecosystem is on fire, with Spotify, Mojang, King and Klarna leading the way.A new generation of companies that includes Truecaller, Lifesum and Trustly are following in their footsteps. Stockholm's secret sauce is a mix of great products, engineering skills, Nordic design and a culture of going international from day one. This is attracting people and capital from all over the world and reinforcing the fact that Stockholm is one of the best places in Europe to build a startup.” Henrik Torstensson, CEO of Lifesum On Stockholm Lifesum is digital health startup that offers its users a flexible platform to support and encourage a healthy, balanced lifestyle. They have won Best of App Store 3 years in a row. Their investors include Nokia Growth Partners, Bauer Media, SparkLabs Global Ventures and others.
  47. 47. Startup Snapshot of Stockholm STOCKHOLM
  48. 48. Unicorn Startups in Tel Aviv and Stockholm TEL AVIV & STOCKHOLM 3 in STOCKHOLM3 in TEL AVIV
  49. 49. Startup Snapshot of Tel Aviv TEL AVIV
  50. 50. SHANGHAI 13 Unicorn Startups in Shanghai Pinduoduo Hujiang
  51. 51. “In my mind, the two most important factors that makes Seoul one of the best ecosystems for startups is its people and infrastructure. In a city where 40% of the population of South Korea is living in Seoul, the population has experienced internet speeds years ahead of any other city in the world which in turn has produced a technically savvy work force and customer base. It is no coincidence that many businesses such as SNS and mobile social gaming were successful in Korea many years before it became globally popular. Because it is the most connected city in the world, entrepreneurs can offer services now that may not be possible anywhere else until later when internet speed and/or user adoption catches up.” Chris Koh, Co-founder of SparkLabs Ventures and Co-founder of Coupang On Seoul Chris is Co-founder of Coupang, which is the leading ecommerce company in South Korea. They recently raised $1 billion from Softbank and previously raised capital from Sequoia Capital Global Equities, BlackRock Private Equity, and others.
  52. 52. Startup Snapshot of Seoul SEOUL Baedal Minjeok
  53. 53. BOSTON & SEOUL 6 in BOSTON 4 in Seoul Unicorn Startups in Boston and Seoul
  54. 54. “The Boston talent pool is unrivaled and the community is very hungry for breakout companies. While there can be disadvantages to being outside the hype zone, I love that it provides space to focus and build transformational products.And I love that the community rallies around emerging companies more than I've seen in any other city.” Pat Kinsel, Founder & CEO of Notarize On Boston Pat is Founder & CEO of Notarize and a Venture Partner at Polaris Partners. He was Co-founder & CEO of Spindle, which was acquired by Twitter in 2013.
  55. 55. Startup Snapshot of Boston BOSTON
  56. 56. About SparkLabs Global Ventures
  57. 57. We are a global seed-stage fund with partners in Silicon Valley, London, Tel Aviv, Singapore, and Seoul. Since December 2013, we have invested in 60 companies. Our global approach means that we can pick the best deals in the right geographies where the sectors are hottest. For example, London has become the leader in fintech, deep tech is growing fast in Scandinavia and South Korea, cybersecurity in Israel and ecommerce in Asia.
  58. 58. Our Team
  59. 59. “SparkLabs team was extremely value-add - they provided strategic advice, brokered relationships, and was 100% committed to supporting us in building our company. They opened more doors for us than any other investor. SparkLabs is an extension of your team. I would work with them in a heartbeat.” - Somrat Niyogi, Co-founder & CEO of Stitch (acquired by SugarCRM) “YJ and I, along with the entire team at KnowRe are ecstatic to be a part of the SparkLabs family, beginning from our days in the accelerator. As an investor and mentor, SparkLabs brings a partnership that truly embodies the characteristics of a family - being involved, bringing to bear ALL of one's resources, a genuine concern for someone that goes far beyond self-interest. This type of partnership invariably leads to a deep trust. As entrepreneurs turned investors, SparkLabs has a distinct understanding of both tectonic shifts in industry and the needs of, say a junior marketing employee. This unique vertical acumen is extremely valuable and a critical component to growth.” - David Joo, Co-founder & Co-CEO of KnowRe ( “Love working with these guys. Gives ‘sweat capital’ an entirely new meaning, going to all lengths around the world to get us what we need.” - Akash Nigam, Co-founder & CEO of Blend ( Our Entrepreneurs Silicon Valley Silicon Valley NYC
  60. 60. “SparkLabs is an amazing team of investors. The partners are experienced operators from around the globe who have helped us with not only key business issues, but also bouncing new ideas. Everyone is intelligent and charismatic, so it's easy to see why the fund has such an expansive network of founders, senior executives, and advisors who are always there to help. If you're a founder who cares about scale, international expansion, or just adding an awesome extension to your team - SparkLabs is your fund.” - Cathy Han, Co-founder & CEO of 42 (YC W14) (www. “The partners at SparkLabs are amazing people and have been a motivating force since the early days of Petnet. They are forward thinking in the way they think about the internet of things and how it will shape they way people shop for consumables. They have an expansive global network of executives, advisors, and investors who are ready to help in any form necessary. SparkLabs is an essential team member for companies who are looking to expand their brand globally.” - Carlos Herrera, Co-founder & CEO of Petnet ( Our Entrepreneurs Silicon Valley LA “Code Kingdoms is delighted to part of the SparkLabs family. The partners understand entrepreneurs because they are entrepreneurs themselves - the guidance and support provide is always insightful, relevant and timely. Having SparkLabs as an investor has been a significant contributor to the growth of our company and also provided immense learning opportunities from fellow portfolio companies and wider network.” - Ross Targett, Co-founder & CEO of Code Kingdoms ( London
  61. 61. “During 2016, the SparkLabs Global team continued their close involvement with Petnet’s fundraising, making introductions that directly led to $12 million of the $17 million we have raised to date.” Our Entrepreneurs Carlos Herrera Co-founder & CEO of Petnet
  62. 62. Thank you!