2019 Tech Trends from High Alpha

by Paige Haefer

Last year, Drew Beechler shared High Alpha’s predictions for tech trends in 2018. Now that the new year is upon us, we’ve circled back with our team to see what their predictions are for 2019. I’ve collected and compiled a list of tech trends and predictions below from our team here at High Alpha to help think ahead and consider what the future of 2019 might hold.

The Rise of Venture Studios

Traditional venture capital has been about allocating and managing assets by investing in promising early-stage ventures and leveraging one’s network and experience to help de-risk those endeavors. In the last 10 years, leading VCs have developed “platform services”, burning investable dollars on headcount to provide light-touch value-added services, such as Marketing or Talent, for their portfolio, but it is debatable whether these services create a meaningful difference in portfolio outcomes or just attract a higher caliber of investable companies in the first place.

Venture Studios are the logical extreme of this movement — burning significant amounts of investable capital on shared services, but co-founding businesses through high-equity, heavy-touch services instead. The studio thesis is that a team of experienced operators can launch, de-risk, and help to scale startups more capital-efficiently and effectively than founders could on their own, yielding higher valuations.

We’ve witnessed the spread of Venture Studios as traditional “Builder Studios” (such as betaworks and IDEO CoLab) raise funds and new ones are created. As their company structures become similar and investors begin to recognize them as a new asset class, we believe Venture Studios will continue to spread, and eventually compete, to define a new era of startup creation.

Ryan Larcom, Director of Operations @ High Alpha

Business Design as a Function

Design has been around as a function since at least 1950 with the mass consumerization of the automobile. Since that time, it’s increased in its scope & stature within organizations. Design has earned a place early in the product design process alongside Engineering. With IDEO’s democratization of design through the Design Thinking methodology, Design moved as early in the product design process.

The advent of SaaS software and focus on customer experience has enabled Design to expand its scope from product design to experience design & this competitive differentiation has led management consultancies like McKinsey to acquire design consultancies like LUNAR.

In the coming years, Design will advance to the next logical scope expansion: the design of business — the intentional selection of business model, GTM strategy, product offering/packaging, and profit formula. High Alpha has established a Business Design function to lead its ideation and other progressive design consultancies, such as IDEO and BCG Digital Ventures, now employ Business Designers.

Amna Sohail, Business Analyst @ High Alpha

B2D (Business to Developer) Business Models

As tech continues to develop products at an increasing rate, developers are seeking tools to reduce their cycle time & spend their precious time on features that are “core” to their company’s differentiation. B2D companies sell products directly to developers that make their jobs easier through the integration of a feature or function. While these business models are not new (see: Stripe & Twilio), we expect to see a proliferation of startups who serve the increasingly important developer market and a GTM strategy of efficiently accessing developers as customers emerge. High Alpha Capital’s investment in Dwolla was made with this thesis in mind.

Roshan Selladurai, Venture Analyst @ High Alpha

Processing Power Arms Race

With the exponential growth of data, advancements in deep learning, and even crypto mining compute is in very high demand. As Moore’s law begins to taper engineers are looking at new, and old, ways of crunching all those numbers.

A few years ago practically no one thought of use cases for GPU’s outside of video games, now they are ubiquitous in machine learning and mining of crypto. FPGAs were only used in very specialized applications but they are now starting to make their ways into data centers for public consumption. This growth has brought competition to the old guard of Intel and AMD from the likes of NVIDIA and even Google with their TPUs.

I imagine this trend will continue until someone, e.g. IBM, cracks the quantum computing problem. Until then, we have to shave every last nanometer and microsecond possible in order to improve performance.

Mark Clerkin, Data Scientist @ High Alpha

Low Code Development Acceleration

I would say low code development will accelerate over 2019. Basically, it’s the concept of a “no code” infrastructure, allowing engineers to build full-blown applications and companies with minimal code, but rather using graphical interfaces to build their product, drastically decreasing time to value.
I would also say the trend to anticipate what users of products need contextually using “AI” will allow for more user interfaces like voice, or other touch-less interfaces, to accelerate and become more common and expected.

Will Jaynes, Software Architect @ High Alpha

Increased Demand for Data Privacy and Ethical Tech Standards in Data Usage

After scandals around selling user data from Facebook and other apps this past year, I think there will be an increase in demand for data privacy and for ethical tech standards in data usage. We might see, for example, more apps for hiding or obscuring data collected about you by your cell phone / social media app activity, more transparency and self-imposed limitations on data sharing by social media companies, and more usage of techniques such as differential privacy in data mining. As data science is increasingly used for things like hiring and legal systems, we might also (hopefully) see shifts in how artificial intelligence applications are used to account for inherent biases in data. It will be interesting to see how these demands are met and if/how it will have any effect on how data science is done in the industry.

Maria Patterson, Data Scientist @ High Alpha

The Rise in Chief Revenue Officers (CRO)

2018 was a major year for the growth of account-based marketing. ABM will continue to be a core strategy for B2B marketing teams of the future and bring sales and marketing teams closer than ever before. I believe more and more companies will move toward a unified sales and marketing strategy under a Chief Revenue Officer (CRO) in 2019 as sales and marketing alignment becomes more important than ever before in an ABM world.

Drew Beechler, Director of Marketing @ High Alpha

We’re looking forward to a fantastic year ahead and are excited to see if our tech predictions prove to be true. We’d love to hear from you, too. Have any tech predictions? We’d love to hear them! Feel free to share below or find us on Twitter.