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Which Overlooked Startup Sectors Will Be Powerful Investments In 2024?

Startup Money.

By Semyon Dukach 

AI commanded the attention of VCs last year, but while investors debated whether to bet on image-generation AI or medtech AI, several extremely consequential startup sectors ended up being overshadowed.

Some of these verticals, though less popular among traditional VCs, may change the world in the next few years, and investors should take note before missing out.

Space exploration opens untold opportunities

Perhaps the most interesting field in startups right now is space exploration, with uses ranging from making space travel more accessible, to asteroid mining for rare metals — including those needed for clean energy tech.

Semyon Dukach, founding partner of One Way Ventures
Semyon Dukach, founding partner of One Way Ventures

Space hasn’t always been a VC sweetheart due to huge upfront costs and high risk. But today, sending products into space is cheaper than ever through private companies like SpaceX. This allows new ventures to test out their technologies at (relatively) minimal cost.

Space exploration offers untold opportunities to improve life on earth. Startups like Odyssey Spaceworks are launching science labs in Earth’s orbit, seeking to accelerate areas like cancer research. Others are helping connect our world with satellite internet or vehicles that break the sound barrier.

Many of these secondary applications can also bring in faster profits than traditional space exploration. But the full applications of such knowledge are so far unknown — which is what makes this sector so explosive.

Robotics bridges software and the physical world

Like other sectors, robotics funding has fallen, but improvements in AI will see robotics become a bridge between “intelligent” software and the physical world. There’s so much potential, it’s hard to foresee all the varied applications — from schools engaging with educational robotics to autonomous bots rescuing humans in emergencies.

This is especially true for humanoid robots, which are increasingly capable of detecting emotions, communicating intuitively and emulating human behaviors. The technology will soon transform spheres that require emotional engagement and human interaction, such as therapy for the elderly.

It will be exciting to see robotics startups solve the challenges of energy efficiency and the need to frequently charge robots (especially the humanoids), or fuel widespread adoption by deploying robotics-as-a-service models, where businesses will essentially rent out robots for their own needs. This could be the year of the robots.

Edtech capabilities soar with generative AI

Edtech funding fell dramatically in 2023 after the pandemic era boost. Nevertheless, some startups are taking advantage of emerging AI technology to create educational products with unprecedented capabilities to respond and personalize lessons.

AI software, such as the developing Kenyan app Somanasi or immigrant-founded, is seeking to solve problems like absenteeism, teacher shortages and “learning loss” with responsive, customizable, one-on-one tutoring bots.

Many edtech teams weren’t necessarily built with AI in mind, but those with established product-market fit can aim to enrich their offering by integrating AI experts or merging with AI companies.

Warehouses store supply chain strength

While supply chain investment has shrunk significantly, stats show warehousing has been relatively resilient; in fact, Amazon recently deployed a $1 billion Industrial Innovation Fund for the sector. But its full potential is still untapped.

Warehousing optimization requires practical innovations toward operations that pose a challenge for humans. For example, working in small urban spaces as e-commerce moves closer to residential areas for faster deliveries.

Startups are coming up with unique solutions to spatial and movement restrictions, from suction robots to gravity-defying ones, and more flexible and scalable storage setups.

Startup observers are always looking for the ideas that break away from the pack and become something truly special. These overlooked sectors could offer some clues.

Semyon Dukach is founding partner of One Way Ventures, a VC firm funding exceptional immigrant founders. A Ukrainian-American, he came to the U.S. as a child refugee in 1979. He is the former managing director of Techstars (Boston), and an angel investor in over 100 companies.

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Illustration: Dom Guzman

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