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Seven Reasons Why You (Non-techie) Need to Care About Startup Investing

  1. Traditional Fortune 500s are dying - New digital (web, mobile, blockchain, AI, robotics) business models are the main reasons why over 50% of the Fortune 500 companies have disappeared since the year 2000. (Weforum)

  2. The New Generation of Most-Valuable-Companies are All in Tech - Instead of GE, Microsoft, Exxon, CITI, and Walmart in 2001, ALL of the top 5 highest-value public companies in 2017 are tech companies (Visual Capitalist):

    • Apple

    • Alphabet (Google)

    • Microsoft

    • Amazon

    • Facebook

  3. Disruptive Innovations are coming from everywhere except big incumbent companies. Industry-changing technologies and innovations are not going to come from a division of a big company. It’s coming from Tesla and XXXX, from Stanford and Berkeley, from 500 Startups and Y Combinator, from Beijing, Tel Aviv, Shenzhen, Shanghai, Hangzhou and hopefully even Hong Kong! And that's why:

    • Unilever bought Dollar Shave Club for $1 billion

    • General Electric bought ServiceMax for $915 million

    • Walmart bought Jet.com for $3 billion

    • GM bought Cruise for $1 billion

    • Disney bought Maker Studios for $500 million

    • Intel bought Mobileye for $15.3 billion

  4. New Business Models and Skillsets Have Emerged - Social, mobile, advance analytics and cloud businesses did not exist 20 years ago. Jobs such as social media manager, mobile app developer, data scientist, and cloud administrator did not exist 20 years ago but are now critical components of most successful businesses. 
  5. CEOs are getting younger and younger - Think Mark Zuckerberg (33) of Facebook, Evan Spiegel (27)of Snap, Wu Hongxing (吴欣鸿) of Meitu (美图), etc. More mature Fortune 500 CEOs are getting beat by tech startups and VCs half their age. 
  6. Your New Generation of Customers grew up with mobile phones and they are spending all their time on the Internet. More than 50% of global internet users are between 15 and 34 years old. They spend an average of 185 minutes per day online via mobile devices. And as the old saying goes, “It takes one to know one.” (Statista)
  7. Private equity and mutual funds are also investing in startups instead of waiting until they go public. 
    • Goldman Sachs invested in Dropbox, AppsFlyer, Uber, etc 
    • KKR invested in Lyft, Go-Jek, 58.com, etc 
    • Warburg Pincus invested in Mobike, Go-Jek, Helix, etc

Also read: 10 Key Questions Before You Jump into Startup Investing

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