There are two sides to a coin and the Covid-19 situation is no different. While on one hand the global pandemic has resulted in the complete shutdown of business, for others, this time of crisis is also the opportunity for new innovations. In fact, just when the first wave of the coronavirus hit the world and people in China started self-quarantine; Alibaba launched its online consumer marketplace. The timing was so perfect that the company jumped ahead to become a $500 billion giant! In the Silicon Valley back in the US, the pandemic has similarly pushed impressive collaborations. According to Sam Altman, the CEO of Open AI and former president of Y Combinator, “This will be a before moment and an after moment for the world” and believes that we are on the path to seeing incredible innovations.
Key Changes to look forward to
The ongoing pandemic has drastically changed consumer behavior across the globe. In fact, today, there are an overwhelming number of people who are looking out for online support and services and the business offering those products have been trying hard to cope up with the increased demands. In a surprising turn, about 12 investment firms based out of Silicon Valley pledged to put more than $30 million into companies that are working on some kind of Covid-19 solution, across the various industries.
Combating Covid-19 with tech
5G and related technologies today have more importance than before Covid. In fact, a study by Huawei highlights how 5G technology can be used to screen people in real time ad issue abnormal temperature alerts. This could become our first line of defense against the pandemic. In countries like China and India, where the sheer population can overwhelm the degree of testing, tech can play a crucial role in offering the much needed ground support to healthcare workers. The advantages even extend to real time and remote patient monitoring, fastened response times, better resource allocations and remote data collection and its analysis. While it’s Huawei in China, the Silicon Valley too has been working on similar platforms, digitizing healthcare and bringing in the concept of telemedicine!
Covid-19 has making it harder for businesses to keep their financial wheel moving. The general uncertainly around the financial environment is showing the ripple effects down to the very basic businesses. For the past decade, there have been incredible innovations made on how people and goods are moved. Mostly powered by technologies, the future of transportation and mobility looks equitable, efficient, sustainable and convenient today. Today, the situation is so fluid that the emergence of now mobility innovations seems even more imminent. A study by Salesforce and Deloitte highlights that the future of mobility will be affected largely by two things – the severity and duration of the pandemic and how governments are collaborating between themselves. From data mobility to the automobile industry, the entire way people and things travel from one point to another will change. Consequently, the companies working in and around mobility solutions will be the flag bearers of the post-Covid era.
Where is the Silicon Valley investing in?
It is only natural that the Silicon Valley is eager to invest in people and companies who could be the possible winners of tomorrow. Fifty Years, an upcoming venture capital firm has already put in more than $13.5 million in projects related to the Covid-19 vaccine and robotic testing. However to understand the future of investment in the Silicon Valley, we would also need to take a look at the changing scenario of seed financing. This is highlighted by:
- Drop in early valuations
- More protective provisions around early deals
- More reserve capital in the hands of early investors to be able to stick with companies
- New opportunities as a result of declined advertising costs
- Opportunity in the form of the consumer being ready for a new social experience and learn new prodcuts
- Easier access to talents
- Fundraising breaking geographical barriers more easily
- A huge leap for startups who were already practising remote work
There has also been a new opening in VC funding as many have openly announced of being approachable. In the past three months, the number of VC deals moving from seed to Series B was just about 541 while the same was 964 in the past year for the same period. Seed stage deals have been hut the hardest, with them dropping by as much as 57%. However, according to Crunchbase, the check sizes didn’t change, meaning that VC now have to fulfill their obligation in investing more capital.
With companies like Facebook offering their staff the opportunity to work from home permanently and this will definitely trigger other technology giants to embrace remote working standards. So, in the future, Silicon Valley wouldn’t be where all the innovations take place! It is Covid-19 has made the world turn global in the true sense!