Some trends will be accelerated in the upcoming weeks when we come back to ‘new normality’ and they will not stop. Although the situation is not easy, there are technological businesses such as education, finance or health that would emerge strengthened from this situation.
“They are weaker companies, they need funding. However, due to their nature, they have more agility and they have generally responded well. They must maintain teams to retain specialized talent. For this, they are creating controlled Records of Temporary Employment Regulation andcutting back on other expenses” explained Sergio Pérez, director of venture capital of Banco Sabadell.
‘Since the investments in startups are usually beheld with a wide time horizon, it will be necessary to analyze which trends will be consolidated and which elements will change after this situation. For example, the increase of teleworking, with the social and demand changes involved, a possible deglobalization with a local production increase, ‘telemedicine’, home entertainment or e-commerce’ they continue from Bankinter. “However, there are some spheres which would not experience drastic changes, such as the products purchase or food delivery”.
There is another perspective too. ‘We have stopped analyzing areas highly affected by this crisis, such as projects related to restoration or travel’, regret Iñaki Arrola, partner of K Fund. Arrola believes that ‘the best years of venture capital is when fear is most present’.
It is too hasty to measure the impact yet, although we can glimpse some signals in the field of startups: sectors like the fintechs, the edtechs or the ehealths which emerge strengthened from this situation. To get out of this crisis, startups have it clear: adoption of digital care channels, digitalization of SMEs and development of products that improve the cloud network’s efficiency.
Despite the difficulties, one out of four startups consider that the current situation is positive for their business, as it contributes to accelerate the digitalization process. On the contrary, they are also aware that the investments will be affected in the short term.
The ehealth investors discuss the opportunity and the responsibility of investing in health technology during market volatility and a possible recession. The new coronavirus represents a pandemic which has not been seen in a century approximately, and it has brought enormous pressures to bear on the health care system and the economy alike.
The ehealth has quickly reached the world stage. The telemedicine acts as a substitute for face to face visits and the chatbots replace the nurse triage lines. However, like all around the world, the industry faces an uncertain financial future yet.
The slowdown depends on the type of investor. In recent years, we have seen the appearance of different types of investors in the digital health stage, including vendor and supplier funds as well as traditional venture capital funds. While the economic slowdown may be on the minds of investors, it may not be doomsday for digital health companies seeking funding at this time.
Sources: El Confidencial, MobiHealthNews, CincoDías
