People have spent a lot of time hating 2016 for a wide variety of reasons. 2017 promises to be better – maybe. There’s still a lot of uncertainty in the world, both economic and geopolitical. Assuming that settles down a bit, there should at least be some solid footing for businesses in the new year.
With that in mind, here are what I see as the biggest trends for 2017 affecting small businesses, startups, and entrepreneurs.
IPOs Will Pick Back Up
Last week, Bloomberg reported that meal component delivery company Blue Apron had delayed its IPO plans. It joins a growing list of businesses that have held off in a relatively slow 2016. This has a number of underlying issues, but the biggest is probably that 2016 was an uncertain year.
With a new president coming in, the market wasn’t sure what to expect in terms of investment potential. Add to that the constant threat of an interest rate increase, and you’ve got a recipe for putting on the IPO brakes.
That’s not necessarily bad news for small businesses, it just means keeping your eye on the ball for a longer period of time and coming to market with more preparation. Blue Apron is reportedly holding off, in part, because it wants to bump up its profits by buckling down on cost management. That’s no bad thing for the company or its future investors.
Next year we should have a return to stronger times. The market will have a better idea of what the new administration’s plans for the economy look like. Regardless of whether you love or hate the outcome, at least things will be more certain.
KPMG reports that “[institutional] investors, in particular, are interested in IPO exits in order to enhance their return on investments.” That alone may be enough to shore up the 2017 IPO market performance.
Your Competitors Will Talk A Lot About The IoT
Oh the Internet of Things – how buzzwordy you are. In 2017, you can bet that everyone and their aunt will be talking incessantly about the IoT. Gartner has been talking about the 20 billion connected devices we’re going to see in 2020 for a while now. Businesses are finally starting to think about how that affects them.
I think what we’re actually going to see is a lot of talk and a very small amount of incredibly cool action. Maybe you make an app that finds friends for your dog nearby – if not, feel free to take that idea. Some dude around the corner is going to say, “Let’s connect the dogs’ collars to the net!” You don’t have to chase that one.
Keep an eye out for genuinely disruptive ideas and tech stemming from the IoT, but realize that your business is under no obligation to implement every idea that you come up with. We see this every time something new pops up in tech. The more thing change, the more they stay the same.
Everyone (Everyone) Will Be in the Cloud
Jumping to a bit of tech that you can no longer ignore, let’s talk about your cloud. You don’t work in the cloud, for some reason, and that needs to change in 2017. Maybe you don’t like the perceived security risk of the cloud or maybe you just haven’t spent the time to make the shift.
Let’s imagine, for a moment, that all your customers are in the middle of the interstate. Cars are whizzing up and down the pavement and you’re standing in the median, selling froyo. Some folks see you over there and take the time to move to you, but most of them are content to buy froyo from the gentleman running around like a madman in the center lane.
There are two real options here. Either you go out in the traffic, take the risk, and sell to your customers or you stay on the sidelines and watch your competitors get rich or your customers get hit by pickle trucks.
Tech companies should be focusing on building cloud-based platforms and tools. Non-tech businesses should be operating in the cloud to make customer interaction, remote working, and data backup easier.
As Irving Wladawsky-Berger wrote in the Wall Street Journal, “Traditional ways of doing business are under siege and must evolve. Cloud-based innovations are a major part of that evolution.”
The term “Middleman” has taken on a negative connotation in America. Generally, these people represent the non-producers. The businesses that make money off the backs of others hard work simply by having the resources to do so. The sun is setting on those days.
Now, middlemen are connecting latent supply with growing demand. Companies like Uber and Airbnb are finding these inefficient setups – people want a thing that other people aren’t using – and connect the two for profit.
Marina Krakovsky, author of The Middleman Economy, argues that middlemen take the most advantage of increasing efficiencies and falling transaction costs in ways that normal buyers can’t. The whole economy is then made more efficient when those middlemen implement the savings.
In 2017, we’re going to see more people moving in to take advantage of those falling costs and inefficient systems.
Young Talent Will Be Harder To Find
Businesses are already having a harder time finding and retaining young talent. The Economic Policy Institute reports that unemployment among recent college grads is still higher than before the recession. While this partially due to the way unemployment affects the young, I think there’s another cause that’s going to play a big role in 2017.
The Bureau of Labor Statistics estimates that about 12 percent of the private workforce is in nonprofits. I imagine that number is going to rise dramatically in the next few years, as a divided country sees more and more opportunity to make a difference by skipping out on the traditional business route.
It was a harsh year of politics in 2016. I can see a great deal of young college grads deciding to try and fix – or wreck further – the country by diving into the world of policy, activism, and support. According to Nonprofit HR, a company with a self-explanatory name, over half of the country’s nonprofits planned to expand their hiring this year. That’s a trend that’s sure to continue, and one that will tap into the same pool your company is try to drink from.
In short – be prepared to fight for the best talent next year.
While we’re all winding up to with the start of the new year, it’s important to remember that there were some good news stories in 2016. We had the first real glimpse of self-driving cars. We landed a rocket on a drone ship. We decided that there were meaningful ways to use VR and drone technology. Finally, Nintendo found a handful of new ways to sell us a Mario game and we lost our minds.
I’m looking forward to seeing what 2017 has in store for us. If you’d like to follow along with our coverage of the startup world and get weekly tips on running your business more efficiently, sign up for our newsletter. You can also hang around until next December and throw this “trends for 2017” list in my face when the predictions all turn out wrong. Either way is fine with me.
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