Every investor knows the story of the lucky (or smart) folks who got in on the ground floor of companies like Uber, Amazon, and Alibaba. Those startups are known as “unicorns” for a reason: They’re extremely rare among the literal millions of startups that come and go in the tech industry.
But that doesn’t stop investors from searching for their own unicorn, and sometimes it feels like any tech whiz who can program an app or wire an electrical enclosure might have the next one. However, the people who invest in startups for a living—those in the Silicon Valley venture capital scene and beyond—know a thing or two about separating the wheat from the chaff, and when they signal their interest in a startup, the market sits up and pays attention.
Wondering what’s next in startups? These seven companies have innovative business models that are attracting major investor interest, and several are already household names. If you’re looking for the next frontiers, these tech companies are already ahead of the game.
The intersection of tech and medicine is a hot space for startups, and few are hotter than Capsule. This one-stop delivery pharmacy brings patients’ prescription medications to their doors and coordinates with providers to manage prescriptions and refills. It’s hard to imagine a business model better suited for a pandemic.
Now, even with the pandemic ebbing in the U.S., investors think Capsule has what it takes to go the distance. With $570 million of equity funding from big names like T. Rowe Price, Capsule is on the path to breaking out soon. It’s likely to find fertile ground in the telehealth expansion, which increasingly appears to be permanent.
Some people may have gone back to shopping in person as COVID eased, but Instacart is still rolling along. The grocery delivery platform recently picked up another $265 million round of funding, signaling investor confidence grocery delivery is here to stay. Market research saying online grocery tech will hit 55 percent consumer adoption by 2024 seems to agree.
It’s no longer just groceries Instacart is delivering either. While the company probably won’t become a true Amazon-Esque “everything store” that sells engine parts and junction boxes, it has added delivery options for stores that offer items like TVs, toys, and furniture. Furthermore, directly competing with Amazon may actually be a boon for Instacart. It’s allying itself with brick-and-mortar grocery stores eager for backup in the fight against Amazon.
Neobanks—banks without physical branches that conduct all transactions digitally—are among the hottest fintech startup sectors, and Current is the latest neobank startup to get investors buzzing. The bank recently received a new round of Series D funding, putting its total equity funding just over $400 million.
Currently focuses on demographics traditionally underserved by banks, such as people living paycheck to paycheck. Its value proposition is a pretty sweet one: Direct deposits that clear up to two days sooner, free overdraft protection, and perks usually associated with premium credit cards like cashback points. For the many people in America who have to do more with less, these features can be not just cool, but potentially lifesaving.
The pandemic sent gym-goers scrambling for home fitness equipment, and Peloton wasn’t the only fit-tech business to experience explosive growth. Tonal, a fitness startup that offers a smart home gym oriented toward weight-training enthusiasts, also made its move toward a strong position in the home fitness market.
Investors are betting at least some of those who worked out at home during COVID will decide they prefer home fitness, and Tonal’s sleek platform and live-streamed fitness classes give them plenty of reasons to do so. Tonal received a $250 million Series E round and has a $1.6 billion valuation, including investments from athletes like Larry Fitzgerald, Maria Sharapova, and Mike Tyson.
Managing passwords is good, but what if you could eliminate them altogether? That’s the premise of HYPR, an authentication company that seeks to improve security by replacing passwords with authentication options like using the biometric scanner on a person’s mobile device.
That’s an easy sell in a world where over 155 million people had personal information exposed in a data breach last year. Plus, with the continuing shift to work from home, increasing numbers of employers are looking for better security. HYPR recently got a $35 million Series C investment that will provide it with more fuel to grow its market share and expand its offerings.
It’s tough to stand out as a social media app these days, but Clubhouse is defying the odds. The invite-only “social audio” app, where users can voice chat in rooms with celebrities like Drake, Elon Musk, and Oprah, was recently valued at $4 billion—although it still has yet to reveal how much total funding it’s raised.
Perhaps the biggest sign of Clubhouse’s success is the number of imitators it’s inspired. Companies like Facebook, Discord, Spotify, and others are all prepping services that will compete for at least part of the same market as Clubhouse. That could spell difficulty for the newcomer, but it’s also a validation of its fundamental business model.
Workplace communication and video chat apps also saw explosive growth during 2020. Now that we’re all familiar with Zoom, get ready for its rhyming-but-unrelated cousin, Loom. This office communication app allows team members to record video messages for each other quickly and easily, making it a snap to share complex directions, detailed feedback, or just a friendly good morning.
Loom brings real human interaction into the digital workplace, but it’s also an extremely agile and flexible cloud workplace app. It’s both faster and more personal than an email, and it’s also an excellent way to cut down on time-wasting meetings. That’s an appealing combination for any office, and Loom now boasts over $73 million in funding.