Investors are always in search of billion-dollar unicorns. And now with Uber and SnapChat being valued in the tens of billions, we are starting to see a new wave of elite “winged unicorns.” But that’s not all the startup scene has to offer.
Somewhere in between multibillion-dollar valuations and those in the hundreds of thousands are some very promising companies that are changing how we perceive and navigate this world.
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1. Skully Systems
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As a motorcycle rider, I’m instantly drawn to this company. But that’s not why it’s on the list. Skully and companies like it are innovating in a space that’s been absent of innovation for decades. In the process, Skully is going to change how people drive and how smart vehicles communicate not only with other cars but any driver wearing a smart helmet.
This is also a big deal in regards to scale. If company founder Dr. Marcus Weller can scale the helmet as a platform, I see the motorcycle line of business being acquired by the likes of Bell or Harley Davidson. They need innovation in house and helmets are just the beginning of what’s possible to disrupt in the motorcycle industry. I also see this type of technology disrupting other industries where helmets are standard issue. For example, racing or military applications. The same technology can also inspire visual displays and capabilities within smarter cars.
Will this happen in 2015? No. But watch this space.
On a side note, I invited Skully CEO and founder Dr. Marcus Weller to share the stage with me at LeWeb in Paris. You can hear the Skully story here.
2. BlaBlaCar
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I love the vibe of this little French company. While Uber and Airbnb are the most well known representatives of the so-called sharing economy, BlaBlaCar is solving the underserved market for people looking to carpool long distance. With BlaBlaCar, drivers and passengers can connect to offset expenses and also make new friends. This introduces a trusted form of peer-to-peer travel that lures travelers away from either driving or taking alternative transportation methods such as buses, trains, or even planes.
The company has already expanded beyond France, recruiting 10 million members in 13 countries who have access to a fleet of more than one million cars, according to The Wall Street Journal. In 2014, BlaBlaCar raised $100 million from European and U.S. venture capital firms, including Index Ventures and Accel Partners — and it’s one of the largest venture investments in a French startup to date. I expect this service to take off around the world in 2015 while also spawning potential competitors in each country.
3. Andela.co
Brilliance is distributed around the world; opportunity is not. Education, particularly that of specialized niches, is traditionally limited to those who can afford it. Enter Andela. I was so taken by this company, I invited Andela to join me at LeWeb in Paris too (watch the video).
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This is a big deal because this same model can be applied to traditional educational programs. I don’t see Andela scaling beyond its focus, but it will successfully prove out the model while investing in Africa. And anything that introduces alternatives to standard higher education models that tend to send students into debt will be more than welcome.
4. Oculus
Facebook-owned Oculus will ship the public beta of its virtual reality headsets this year and will transform the way consumers experience the real and digital worlds. You should also be prepared to take motion sickness medication if you’re easily upset. But once you immerse yourself in these new worlds, traditional reality might be a bit difficult to endure.
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5. Magic Leap
One of the companies stoking the imagination of the Silicon Valley elite is Magic Leap, a mysterious startup based in Florida that recently claimed notable science fiction author and game designer Neal Stephenson as its Chief Futurist. Stephenson revealed that he was lured to Magic Leap after seeing a demonstration of the company’s technology. “Magic Leap is mustering an arsenal of techniques … to produce a synthesized light field that falls upon the retina in the same way as light reflected from real objects in your environment,” he shared. Like Oculus, it will cater to gamers as well as “readers, learners, scientists, and artists.”
So what is it? The answer is “cinematic reality.” Essentially, Magic Leap is a device that makes virtual objects appear in real life. And it was worthy of a $542 million investment from Google. It’s also rumored that Legendary Pictures has a notable investment and potential stake. All we know is that the company is working with light-field technology. BusinessInsider revealed that Nvidia’s use of the technology made 3D images “appear more realistic and natural to your eyes.” The idea is that Magic Leap could do the same for movies, gaming, and virtual reality/augmented reality.
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Magic Leap’s vice president of games, Graeme Devine, shared his reaction to the technology prior to joining the company at Unite 2014, according to RoadtoVR:
Now MIT Technology Review offers a much more detailed view of Magic Leap.
Author Rachel Metz describes it as a tiny projector that shines light onto a transparent lens. This, in turn, deflects the light directly onto the retina. The pattern of light blends with the light you’re receiving from the real world in a way so that your visual cortex sees artificial and actual objects as the same. We may see something from Magic Leap in the next one to three years.
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Click to page 2 for MakerBot, Fuel3D, Instacart, Electric Objects, and Yik Yak.
6. MakerBot
MakerBot is the darling of consumer-facing 3D printing. We all can appreciate that 3D printing is going to completely transform every industry and also supporting supply chains. But at the same time, MakerBot is going to teach consumers, slowly at first but faster over time, how to think differently about products and parts. They might order up a recipe from a particular manufacturer to print upgrades or replacement parts. This capability will only become more advanced. In mid-to-late 2015, MakerBot will introduce new composite filaments and supporting tech for its printers to enable consumers to print prototypes with bronze, maple wood, and iron-like materials.
MakerBot is expanding its retail presence with small boutique stores of its own. And the company expanded its pilot retail program with Home Depot to 30 stores late in 2014.
As 3D printing becomes mainstream, I see demand for applications not only in art/crafts, replacement parts, and medical, but also in new markets where creators, designers, and brands can sell or give designs to consumers at a discount, saving on manufacturing and distribution.
7. Fuel3D
On the subject of 3D printing, imagine owning hardware that could clone artifacts simply by rendering a 3D model on the fly. Fuel3D is the developer of Scanify, an affordable handled 3D scanner that could do just that. The technology was originally designed for the medical imaging market. But now Scanify gives consumers, businesses, and industry professionals the ability to 3D scan objects for a variety of applications. In medical alone, Fuel3D could bring down costs and accelerate the availability of parts, fixes, and transplants. Partnered with MakerBot or other 3D printers, the possibilities are mind-boggling.
8. Instacart
Everyone seems to be talking about Instacart. In December of 2014, the company raised a whopping $100 million at a valuation of $2 billion to allow consumers to order groceries from their phone or desktop and have them delivered to their door in less than an hour. If you lived through Web 1.0 and the dotbomb bust like I did, you might recall Webvan. But the difference here is that Instacart makes use of the on-demand freelance workforce and is scaling to deliver everything from local service providers and restaurants. For example, with Valentine’s Day creating a huge opportunity for flower delivery, Instacart expanded services to include rapid flower delivery. In Austin, Instacart teamed up with Tomlinson’s Pets for same day delivery of pet food and supplies (Pets.com anyone?).
9. Electric Objects
Everyone remembers the digital picture frames that adorned desks and walls everywhere from the likes of Kodak and other consumer electronics brands. Just kidding. For some reason, the digital frame market never really materialized. But Electric Objects is taking a new approach to make digital art relevant in an analog world. The idea is to rethink what art could be and how it lives digitally, whether it’s on a wall or on a desk.
The company secured $1.7 million in funding in 2014 and then raised an additional $800,000 on Kickstarter later in the year. The company is introducing a digital frame that is controllable via a mobile or desktop app. It is also working with artists to commission a new genre of living digital art to bring these frames to life in new, creative ways. But even beyond the concept of “living art,” Electric Objects pushes consumers to think beyond the permanent static artifact. In a time when we’re consuming listicles, memes, Vines, Hyperlapses, animated gifs, etc., the company pushes us toward “simplicity, stillness and silence,” according to founder Jack Levine. Over time however, I would expect to see these devices turned into strategic installations in offices, galleries, classrooms, etc. Digital curators will commission or assemble pieces that engage, calm, challenge, or educate passersby, motivate employees, and contribute to the ambiance of any setting.
10. Yik Yak
Messaging is the new social media, and anonymous posting in geo-location community forums is the new messaging. So says Yik Yak anyway. And consumers, mostly college and some high school students (even elementary schoolers too) are flocking to it in droves. In fact, the company was awarded “Fastest Rising Startup” at the 2015 Crunchies.
Yik Yak is an app that allows anyone to post anything without a username. In fact, you don’t even need a password to log in. It was created after its developers recognized a need to create conversations and build communities between people who may not have had any prior connection. Yik Yak looks like Twitter, operates like Whisper or Secret, and feels a lot like Reddit. The most interesting thing though is that all engagement is done without photos or handles. Since the app is localized, only users within 1.5 miles of the message can read it.
Yik Yak hockey-sticked (if that’s a verb) in Q4 2014. It’s estimated that the app is already used by 2.5 percent of all iPhone users in the U.S. on a regular basis. Yet some schools are starting to call for its ban as young adults and kids are trolling one another because of the anonymity.
I’m fascinated by the service’s focus on proximity and engagement. Students who aren’t protesting the app’s existence claim that it offers entertainment value and also cultural relevance. They feel plugged into whatever has the attention of the campus at any given moment. It counters FOMO I guess, at least from a contextual standpoint.
Because of its focus on location and nearness, Yik Yak, for better or worse, is setting the stage for hyper-local networking that can be applied to almost any application where locale is everything.
Click to page 3 for Slack, Facebook at Work, Exitround, and We Are Pop Up.
11/12. Slack/Facebook at Work
Business messaging is both a commodity and a space already ripe for disruption. As of October 2014, Slack was the fastest-growing workplace software ever. That’s a pretty astounding feat considering that the company launched in 2014 and just nine months later announced $120 million in funding with a valuation of $1.12 billion. It’s been called a fancy chat room. But what it does is bring conversations strewn across multiple apps back to one place. It is also a powerful repository of all company engagement tied to a powerful search platform.
Slack boasts over 500,000 daily active users, who spend collectively over 100 million hours on a monthly basis sending over 300 million messages. The company is already generating over $12 million in annual revenue from over 135,000 paid accounts.
The pitch for Slack is that it makes you more productive by reducing the amount of time you spend on other productivity-related tasks. But it’s the entire user experience and approachable premise that I believe sets Slack up for future success. It’s completely human-centered, meaning that the design and functionality are intended to get you connected and engaged. It’s already familiar, building upon how people communicate outside of work to make collaboration intuitive at work. From there, the platform simply facilitates what you want to do. The tech is invisible. And it connects to tools your company already uses, so it becomes part of a hub or workflow. Believe it or not, this is rather uncommon in the enterprise software world. And the trend towards consumerization of business tools is only going to follow Slack’s lead and set the entire space up for a complete overhaul. Watch out, Salesforce!
P.S. Slack is brought to you by Stewart Butterfield, cofounder of the now Yahoo-owned Flickr photo service.
In 2015, you will also see Facebook at Work roll out slowly at first and then at scale as time and the app age a bit. It is designed to help groups of users collaborate, share documents, and manage projects in the workplace. My partner at Altimeter Group, Charlene Li, pointed out that Facebook has been using this tool internally for the last four years, and thinks it’s robust enough to launch for the general public. “We have a long history of successfully connecting people and connecting businesses,” said Elisabeth Diana, corporate communications director at Facebook. “It’s a worthwhile test to explore.” As Charlene also noted, enterprises could potentially have a hard time keeping employees on Chatter, Yammer, or other internal social networks when the Facebook interface is already so familiar and functional.
13. Exitround
Exitround, founded by Jacob Mullins and Greg Dean, is a private, anonymous marketplace for buyers and sellers of technology companies [Editor’s disclosure: Jacob Mullins previously worked for VentureBeat]. It helps buyers find technology companies that fit squarely within their target. Exitround also eliminates inbound chaos by automating prospecting. Essentially, buyers only speak to companies that fit their strategic interests. This also optimizes potential exits for startups. In the end, these types of deals come down to human relationships and people.
We all know that most startups, even those that are the most promising, are likely to fail. There are several possible exits beyond demise. “Aqui-hires” are most prevalent of course. There’s also asset acquisition, where acquiring companies can build or expand on the work done by others.
Exitround’s platform applies a sophisticated human algorithm that creates unmatched efficiency and desirable outcomes. While this is traditionally done through highly connected personal networks, there appeared to be an opportunity to add marketplace dynamics and algorithmic sophistication to gain a high level of scale in connecting buyers and sellers who may be a perfect match, but otherwise may not have met.
Exitround is optimizing an existing market through new tech, but it is doing so in ways that breathe life into potential deals sooner and with better matches that lead to improved outcomes. For those companies that see quiet exits or those investors seeking great tech or talent under the radar, this is exceptional.
For the last company, I wanted to include something that’s flying under the radar but also doing things that create new opportunities. Brands are always looking for ways to capitalize on the latest trends. At the same time, entrepreneurs, artists, designers, photographers, etc., could use creative outlets to show or sell their creations. We have seen countless shops pop up and then vanish, from everyone from Marc Jacobs to Nike, Levi’s to Marshawn Lynch, and anything you can imagine in between. Each time they pop up, they seem to be a hit while also earning the attention of consumers and media alike.
But what happens when you don’t have connected retail experts to help you facilitate your own pop-up? Meet We Are Pop Up. Said simply, this promising company is best described as the Airbnb of temporary retail space. It connects landlords and temporary tenants with commercial grade space to host a popup shop, experience, or event. The result is a unique, short-term use of space to engage customers, host a creative function, generate buzz, or test new ideas. Artist Sophie Giblin opened a pop-up gallery in Brighton Square for her work using the service. “It is cheap and low risk and a great way of showing off the work of local and emerging artists. There is no way I could afford to commit to a long-term lease on a gallery,” she shared in a recent story.
Brian Solis is a digital analyst, business strategist, and futurist. He is a Principal Analyst at Altimeter Group and author of the book What’s the Future of Business (Wiley, 2013).
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