Image source: Universal Pictures / Amblin Entertainment
I am going to start a tradition much like what Fred Wilson has been doing for as long as I can remember. For those readers who have been part of the Startup Iceland journey since 2011, you all know that I take a lot of inspiration from the likes of Fred Wilson and Brad Feld, who have been Venture Capitalists for over 3 decades and have stood the test of time as it relates to what they say and do.
The pandemic has fundamentally transformed the trajectory of the human experience. I am not exaggerating when I state that. Although a number of us would want to get back to the good old times, I think we will see less of that becoming the main stream. I am sure we will get the pandemic under control in 2021, given the advances in vaccine technology. I am also certain that this will not be the last pandemic that we will face as the human species. I am also certain that we will get back to traveling and vacationing but it will not be without caution. Work as we know it has changed, we will see more people opting to work greater than 50% of the time from home. I believe this is a good thing. Technology adoption across all businesses will accelerate due to the above trend. Founders building companies that are built with technology as foundation and solving some of the obvious challenges will capture value. I believe the industries that are ripe for this transformation are Healthcare, Financial Services and Climate related transformations. What is going to be most counter intuitive transformation is going to be innovation in Business Models. The way value gets transacted. The move to digital money (crypto currecy or token economics) and decentralized technologies is inevitable now.
The long view that I had in 2009 that Iceland can be a vibrant startup community has become a reality. This trend will continue with it we will see innovation in even traditional things starting to accelerate. I believe this to be true because of the fact that we have been operating with localization. I think the dependence on countries for manufacturing, technology, pharmaceuticals, products and services is going to be totally transformed. I think the biggest loser in this space is going to be China as more and more countries try to become self reliant in things that they used to depend on other countries. The comparative advantage economic principle is going to be challenged. The reason I say this is because of a number of ways we organize to solve problems. Technology and now workforce has been democratized. Small countries like Iceland can actually become more anti-fragile as they invest more in self reliance by attracting talent, capital and know-how.
Governments of large economies will try to legislate to save the old industries but this is a futile attempt as innovative new companies that challenge the old ways will be more nimble, intuitive, easy to use and will have unlimited global access. This is a great opportunity for founders and startups as the cost of starting a new venture has become negligible. Large technology companies will play the war of attrition with themselves and the regulators. Once again a great opportunity for startups and founders.
Climate change will bring more challenges to the present and companies solving those problems are going to be immensely valuable, don’t believe me? look at Tesla stock price. Tesla is but one company that has captured the imagination of the investing world but there is plenty of opportunity for everyone to capture value in this transformation. Reducing waste, using new energy sources that are not carbon based and innovative ways to build things is also going to become mainstream. I do not believe that this is going to happen overnight but in the next decade we will change how we make things. As Bill Gates famously said we overestimate the next 3 years and underestimate the next 10 years.
It is weird to say this but it is exciting time to be looking into the future. What 2020 has taught me is to value things that I used to take for granted and this is probably true for many people if we stop to listen. Looking back what challenging times do is help all of us get stronger and evolve. I hope it has done that for you. I am grateful and thankful for all the challenges that I have faced the last year. I am sure I was one of the few in the world that were much more luckier than most. I have personally started meditating more, watch less social streams or news feeds as they do very little to add value to what I spend most of my time doing. I have started focusing more on my family, friends and the founders/teams that we have invested in and help them build great breakthrough global technology companies. With that I wish everyone a Happy New Year.