As the IT industry grows by leaps and bounds, more entrepreneurs consider launching their products. According to Markets and Markets, the North American IT services market is expected to grow from $500B in 2022 to $700.6B by 2027. Today, the US is home to 70,000+ startups.
Many startups are linked to the tech sector. In this article, we show tech trends for 2023, share some forecasts and insightful statistics per the technologies, and provide tips on the most advantageous locations to launch your new business.
Small companies tend to invest in hardware upgrades. According to Salesforce, automation demand surged in more than 90% of companies.
All companies consider enhanced data security a crucial business priority. This priority is justified and backed up by facts: the security tech market reached $173.5B in 2022 and is projected to hit $266.2B by 2027.
Cybersecurity is not the only profitable tech area to enter. Read on to learn more about them.
Startup tech trends 2023
After analyzing research, reports, and studies, we outlined nine pivotal tech trends this year:
- Robotic process automation (RPA)
This technology automates peoples’ work and routine processes (mail delivery, correspondence, handling transactions, etc.). Any great new products and services that take some of this burden off our shoulders are welcomed.
Fortune Business Insights states the global robotic process automation market is projected to grow from $13.86B in 2023 to $50.50B in 2030 at a CAGR of 20.3% in the forecast period.
Analytics Insights predicts that in 2023, more and more SMEs will adopt RPA and intelligent automation. By automating and streamlining business operations like generating invoices, RPA allows business owners to focus on more important operational and strategic tasks. Also, RPA technology cuts down operating costs, increases businesses’ accuracy, and improves customer experience.
Virtual reality perfectly suits entertainment purposes. Statista study shows 65.9M VR users in the U.S., which is 15% of the country’s population. The VR industry market size was estimated at $28.82B in 2022, and CAGR is expected to reach 15% by 2030. Technology requires special devices (helmets, glasses, vests) and sophisticated applications. VR games and esports are lucrative niches to enter. There are many players in the VR industry, but the market size is huge—thus, so is the potential.
Augmented reality is like VR: both technologies deal with an extension of reality. But marketers see the difference between their implementation in business. AR technology showed its efficiency in ecommerce. It allows users to preview and try on products from catalogs as if they have already bought such products. For instance, people can select shoe models from e-stores and focus a mobile camera on their feet, and AR will render it like this:
The same experience works for any type of clothing or footwear, makeup products, accessories, and even interior design. AR shopping has a promising future.
The AR market size in the US is forecasted to reach 110.1M users in 2023. Catch the trend and build your unique idea.
- Artificial intelligence (AI)
Insider surveyed 68 founders regarding the most promising tech trends in 2023. AI topped the list of the most frequently mentioned technologies among them. Little surprise. ChatGP3, Chat GP4, and the ensuing introduction of new AI-based tools and services are changing the dynamics of all industries—there are pros and cons to these changes.
Games containing AI-generated assets appear on Steam. ChatGPT enables users to generate meaningful texts and source code.
Professionals effectively manage ever-increasing scope. Biologists have drastically decreased time needed to discover a new antibiotic against a drug-resistant bacterium.
Businesses will be interested in AI tools that promise to decrease time for searching or generating initial concepts.
Blockchain keeps on trending because cryptocurrencies continue to gain momentum. Interest in blockchain technology remains warm because of insanely popular NFTs (non-fungible tokens)—another crypto asset.
Web3 plays a key role in the evolving digital ecosystem. It uses blockchains, cryptocurrencies, and NFTs to free users from dependency on any third-party vendors.
No one gets isolated easily and their assets frozen. Hence, users retain complete ownership over their digital assets.
Web3 is young. Barriers to wide adoption exist, such as required tech expertise, high transaction costs, and reliance on centralized infrastructure. Still, many companies are working on lowering barriers.
The IoT concerns all devices equipped with Wi-Fi. These are not just computers or smartphones. IoT also includes toys, fridges, clocks, house appliances, and building management systems. IoT links separate devices and systems, empowering them to transmit data via the Web. Analytics predict the number will grow annually and reach 34.2B by 2025.
Furthermore, in 2023, people will use more than 15.4B connected devices worldwide, estimated to strike a 29.42B benchmark by 2030. The IoT market is worth approximately $800B and is expected to grow to almost $1.1T at a CAGR of 13% in 2024. All these figures eloquently show the uptrend for the IoT in the long-term future.
Edge computing is a new method of information transfer. It is more efficient than cloud computing. Why? Because it eliminates the problem of latency that occurs when using a cloud service provider. Edge computing processes data closer to the source—at the edge of the networks, not in the cloud. No more delay between client requests and server responses.
Edge technology ensures fast delivery of time-sensitive data to distant places and speeds up responses of Web applications. Edge computing demands specialists who configure and administer the whole system.
Some researchers regard ML as a subdivision of AI because it “teaches” computers and allows them to “learn by themselves.” ML is a popular and essential technology, especially for big data companies.
It is very helpful for startups in education, healthcare, fintech, and digital marketing. While education projects can provide users with efficient, personalized studying plans based on analysis of initial tests, the healthcare industry benefits from accurate diagnosis supported by ML. As to digital marketing, Machine Learning facilitates business sales by creating deep client personalization. This helps sales reps target highly qualified leads.
Cybercrime is endemic. The FBI reported a 300% increase in cybercrime since the COVID-19 pandemic. Experts expect cybercrime damages to reach $10.5T per year by 2025. Although cybersecurity has been developing since the early stages of information digitalization, it is far more relevant today.
Emerging technologies demand enhanced security because of the continuing high level of cybercrime worldwide. In 2022, the cybersecurity market hit a $2T value. As cybercrime activity keeps evolving, the market share for cybersecurity solutions also grows.
Top 5 startup business-friendly countries
Before launching your tech startup, pay attention to a country where development is happening. Different countries have different laws, regulations, and workforce qualifications. These factors significantly affect your project’s total cost, quality, and eventual success.
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The United States, with its “American Dream” philosophy, offers perfect conditions for entrepreneurs. Most world-famous startups, such as Instagram, Airbnb, Uber, and more have been founded in the USA.
As of 2023, the USA is the #1 startup country. There are 656 US unicorns, based on the list composed by CBI Insights. 19.2% of the US population is engaged in startups.
The world’s largest venture capital and investment groups establish their headquarters in the US. Their presence allows startups to arrange offline presentations and project pitching in offices.
When done right, live communication promotes the opportunity to attract investors and raise funds. Device users in the US are advanced and like to consume smart tech products. Such a social profile increases the chances for tech startups to win.
Despite Singapore being a small country of 283.5 sq. mi (728.6 km2), it provides businesses with big opportunities. Singapore is a leading financial hub in the world—home to 20 unicorns, according to Statista. The equity funding for Singapore-headquartered firms reached $4.13B in 2022.
The government patronages special programs helping promising startups release their projects. For instance, the Startup SG program includes an independent SG Tech vertical. It offers grants covering proof-of-concept (POC) and Proof-of-Value (POV) to commercialize innovative technologies. Have any bold tech ideas? Consider Singapore as a potential business area to work in.
Germany is another great location to start tech projects. The country has a robust startup ecosystem. You can get state-of-the-art infrastructure, modern facilities, and a lot of options for funding from local investment groups.
Germany has one of the world’s most developed and stable economies, ensuring startups a safe and predictable business environment. The country offers an attractive business entry policy. Germany holds the 7th position in the Global Startup Ecosystem Index, right after Singapore. It boasts 44 cities in the top 1,000 and has a vibrant startup scene.
The United Kingdom is one of the major European financial hubs. In 2022, startups in the UK raised £15.6B. Regarding the industry prevalence, fintech is the leading startup vertical in the UK, with 1,400 fintech sectors showing high growth. London is home to at least 80 unicorns. The country has strict business regulations, so you must pay close attention to all legal requirements as a startup.
On the one hand, such carefulness in terms of law provisions might repulse a startup from entering the market. On the other, for the same reason, the average five-year survival rate of UK startups is 42.4% which is outstanding.
Sweden is one of the leading European innovation hubs, ranked in the fifth position of the above in the Global Startup Ecosystem Index. The government ensures a transparent policy and business handling processes. Thus, entrepreneurs from all over the world incorporate their companies in this country.
According to Sweden Tech Ecosystem, in 2022, €5.2B was invested in the country’s technology companies.
The future of the global tech market
According to another Statista report the revenue in the IT services market is projected to reach $1,204B in 2023 (with a CAGR of 6.2% within 2023 – 2027, resulting in a market size of $1,570B). Also, the market’s largest segment is IT outsourcing software development services for startups, with an estimated market volume of $430.5B in 2023.
Meanwhile, there is a problem for startups (especially in the US) finding a reliable, cost-effective software development company to bring their ideas “to life.” Too often, IT specialists’ rates in North America and Western Europe are too high. So, young startups search beyond their borders for a vendor to fit their budget.
As a startup, you cannot go wrong with the price-for-the-quality ratio when working with Central/Eastern European software development companies. Local engineers provide you with:
- solid technical background
- deep expertise in timely product deliveries
- similar mind stack and working culture
- reasonable hourly rates
- fluent English
Check here how outsourcing MVP development works.
Nobody knows exactly what surprises will turn up before 2024 arrives. If you have a bold idea, you could turn it into a profitable project. Let’s build the future together. Keep abreast of the latest technologies and improve your business with IT Craft.