There’s a point at which a technology market or sector feels overhyped and saturated. Sometimes it’s when the first $1 billion valuation is announced—or when venture capital starts flowing so freely that it seems due diligence is an afterthought. And it’s definitely when media start calling tech businesses “Uber for (fill in the blank).”
In some sectors, this comes with a feeling of lost authenticity, like watching a band you discovered 10 years ago in a small music hall now play a megaconcert in front of 50,000.
Whatever the case may be, there are several industry sectors in 2015 that have felt heavily hyped as new startups pile into the rat race and investors follow. They’re not all frivolous fields—see fintech and cybersecurity—but each is full of similar-sounding approaches and me-too players. The question that leaves us with: How does that change the likelihood of success?
Hard to say, but rising above the noise is getting more difficult. Across the Xconomy network, we’ve identified nine technology areas that are particularly noisy. It’s not a comprehensive list, but one supported by our coverage of specific companies. (You could argue for adding virtual reality, Internet of Things, and edtech, for example, but the startup approaches in those areas are generally earlier and more varied than those in our list.)
Check out the slides above to learn more details about each of the sectors. Here’s a quick list of all those mentioned:
1. Food delivery
—The delivery sector is perhaps the busiest, with traditional services including San Francisco-based Instacart, Austin, TX-based Favor, San Francisco’s DoorDash all raising money this year.
—EatStreet, the Madison, WI-based delivery app, is also primed for an exit.
2. Drink delivery
—OK, it was inevitable. Booze-related services, including Drizly and Bright Cellars, are drawing attention from investors, entrepreneurs, and consumers.
—Other efforts in the sector include Saucey, Thirstie, Ultra, and Klink.
3. Fintech and lending
—Small business lending services Lending Club and OnDeck both had initial public offerings last year, raising the profile of the sector.
—There’s a great variety of other online lenders, including Fundbox, Prosper Marketplace, Dealstruck, DriverUp, and Able.
—And don’t forget specialty financiers such as Palo Alto, CA-based Upstart, New York-based Biz2Credit, and San Diego-based LoanHero.
4. Adtech
—Advertising technology is still getting plenty of funding, but reports are surfacing that VCs may be starting to shy away.
—Nonetheless, Denver-based Choozle and Boston-area startups Clypd and Nanigans, all raised money this year—just to name a few.
—Some other notables in the field are AdRoll, AppNexus, Brand Networks, DataXu, and Jelli.
5. Subscription services
—Startups that offer subscription deliveries of curated goods, such as Birchbox, Dollar Shave Club, and MeUndies, have gone mainstream in the past year or so. The goods, usually delivered monthly, range from food to clothing to cosmetics.
—Other notable companies in the sector: Julep, NatureBox, Graze.
6. Wearables and health tracking
—Fitbit is a big name this year, with its IPO in June. And, of course, Apple introduced its smartwatch. Wearables startups face lots of challenges, but tech companies including Healbe Gobe and MC10 are changing the way people think about health tracking.
—Other companies in the sector include Jawbone, Misfit, Garmin, Neumitra, Quanttus, Whoop, and Runkeeper.
7. 3D Printing
—With thriving companies from Carbon3D, Formlabs, and Autodesk to Shapeways and Staples, it seems everyone is getting into 3D printing, from consumers to designers to manufacturers.
—Other players: Voxel8, MarkForged, 3D Systems, Stratasys.
8. Drones
—Need we say more? From Airware to CyPhy Works to 3D Robotics, unmanned aerial systems are capturing the hearts and dollars of consumers, enterprises, and investors. The big applications seem to be surveillance, selfies (video), and package delivery.
—Other players in the broader sector include defense contractors, DJI, Matternet, DartDrones, HUVR, LaserMotive, and Smartvid.io. And, oh yeah, Amazon, Facebook, and Google.
9. Cybersecurity
—This might be the most prevalent word of the year among enterprise companies. Now every security startup from Silicon Valley to Boston seems to have the magic approach to detecting and responding to attacks. Few are proven.
—The rise of smartphones and the coming wave of connected cars, Internet of Things, and electronic health records should make this a frothy field for years to come.
—Rapid7 went public in July, while numerous other security companies are mulling possible exits. Area 1 Security, CrowdStrike, Keybase, Okta, and Tanium have raised recent rounds.
—Other players: Bit9, Veracode, CounterTack, Cybereason, Resilient Systems, Sqrrl, Threat Stack, and bigger-company efforts like Symantec, IBM Security, Palo Alto Networks, and FireEye.
Gregory T. Huang contributed to this report.
