Emerging Technology Indicator

Our newest report, the Emerging Tech Indicator (ETI), provides a quarterly overview of the startups receiving early stage investment from a select group of the world’s most successful venture firms. This group of investors is identified each quarter based on our proprietary methodology that measures the historical success of the startups they invest in in terms of ability to raise capital, valuation, and exit rates. By narrowing down the thousands of early stage VC deals that occur each quarter to focus only on those deals involving the most successful investors, our first ETI report offers a unique perspective on the kinds of technologies attracting early growth investment.

We tracked more than 170 startups across 30 market segments in Q1 that received capital from ETI firms. The top five areas of technology investment included biotech at $1.49 billion, followed by fintech, decentralized finance, health & wellness tech and e-commerce.

Key takeaways

• The trend of developing demographic-focused financial services, such as mobile banking apps for Black and Latino communities, was a popular formula for attracting ETI deal capital in Q1.

• Remote work has impacted where people choose to live and changed how they think about travel and vacationing. Proptech activity in Q1 suggests new opportunities in real estate and housing may be emerging, potentially stemming from the pandemic-driven upheaval of the real estate and travel industries.

• Capital investment in decentralized finance startups represented the third-largest area of ETI deal activity in Q1. The funding activity was primarily led by the price strength of core crypto assets including bitcoin and Ethereum, the emerging market for products such as NFTs, continued institutional involvement in the space, general regulatory acquiescence to the industry, and the IPO of Coinbase.