--- title: The Past & The Future of New Businesses. | SFC Capital description: Over the past 20 years we have seen a boom in startups following the same trends and in similar industries. This was a result of opportunities arising from image: https://sfccapital.com/hubfs/Imported_Blog_Media/banner_1522928536.webp --- Disclaimer Please note, company introductions through SFC Capital Ltd ('SFC') are only suitable for ‘High Net Worth Individuals’, or ‘Sophisticated Investors’ as defined by the Financial Services & Markets Act 2000 (FSMA) who are familiar with and willing to accept the high risk associated with private investments. Any investor requesting to contact a company through SFC Capital does so at his/her own risk and is solely responsible for conducting any legal, accounting or due diligence review. 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The content is for information purposes only and should not be used or considered as an offer or solicitation to purchase or sell the securities mentioned herein. The SFC Angel Fund (the ‘SFC Fund’ or the ‘Fund’) is defined as an ‘unregulated collective investment scheme’ (‘UCIS’) and the promotion of a UCIS either within the UK or from the UK is severely restricted by statute. Consequently, this document is only directed at professional clients and eligible counterparties as defined by the FCA and also to persons of a kind to whom the Fund may lawfully be promoted by an authorised person by virtue of Section 238(5) of the Financial Services and Markets Act 2000 and COBS 4.12.4R. The SFC Angel Fund is managed by SFC Capital Partners Ltd (‘SFCCP’) which is authorised and regulated by the Financial Conduct Authority in the United Kingdom, firm reference number 736284. Information on the Fund is intended for professional investors only; any reproduction of this information, in whole, or part, is prohibited. The content is for information purposes only and should not be used or considered as an offer or solicitation to purchase or sell the securities mentioned herein. The SFC Angel Fund (the ‘SFC Fund’ or the ‘Fund’) is defined as an ‘unregulated collective investment scheme’ (‘UCIS’) and the promotion of a UCIS either within the UK or from the UK is severely restricted by statute. Consequently, this document is only directed at professional clients and eligible counterparties as defined by the FCA and also to persons of a kind to whom the Fund may lawfully be promoted by an authorised person by virtue of Section 238(5) of the Financial Services and Markets Act 2000 and COBS 4.12.4R. Any decision by an investor to buy shares in a fund must be made solely on the basis of the information and terms contained within the Fund’s offering memorandum. Investment in the Fund is made entirely at the investor’s own risk and professional advice should be sought in case of doubt. The SFC Angel Fund is an SEIS/EIS fund which raises money for early-stage businesses by investing in SEIS and EIS eligible ventures with the aim of returning a profit for investors in the fund. Investment in early-stage companies involves risks such as illiquidity, lack of dividends, loss of investment and dilution. Investment in SEIS/EIS funds should be considered as part of a diversified portfolio. The availability of tax relief depends on individual circumstances and may change in the future. The availability of tax relief depends on the company invested in maintaining its SEIS/EIS qualifying status. There is no assurance that the investment objectives of any investment product will be achieved or that the strategies and methods described herein will be successful. Past performance is not necessarily a guide to future performance and the value of an investment may go down as well as up. Investors may not get back the full amount invested. No warranties or representations of any kind are expressed or implied on this website. I Accept The Terms ## FCA Mandatory Risk Warning & Risk Summary > ## Risk Warning > > **Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment, and you are unlikely to be protected if something goes wrong.** ## Risk Summary **Estimated reading time: 2 min** Due to the potential for losses, the Financial Conduct Authority (“FCA”) considers this investment to be high risk.   What are the key risks? 1. You could lose all the money you invest. Investments made by the SFC Angel Fund SEIS (the “Fund”) will be in shares in early-stage businesses. Investors in these shares often lose 100% of the money they invested, as many early-stage businesses fail. 2. You are unlikely to be protected if something goes wrong Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here: [https://www.fscs.org.uk/check/investment-protection-checker/](https://sfccapital.com/fca-mandatory-risk-warning-and-risk-summary/%20https://www.fscs.org.uk/check/investment-protection-checker/)    Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm, FOS may be able to consider it. Learn more about FOS protection here: [https://www.financial-ombudsman.org.uk/consumers](https://www.financial-ombudsman.org.uk/consumers) 3. You won’t get your money back quickly Even if the businesses the Fund invests your money in are successful, it may take several years to get your money back. The most likely way to get your money back is if the businesses invested in by the Fund are bought by another business or list their shares on an exchange such as the London Stock Exchange. These events are not common. 4. Don’t put all your eggs in one basket Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.  A good rule of thumb is not to invest more than 10% of your money in high-risk investments.  [https://www.fca.org.uk/investsmart/5-questions-ask-you-invest](https://www.fca.org.uk/investsmart/5-questions-ask-you-invest) 5. The value of your investment can be reduced The percentage of each investee company that the Fund owns will decrease if the business issues more shares. This could mean that the value of your investment in each investee company reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.  These new shares could have additional rights that your shares don’t have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment. 6. S/EIS tax reliefs are not guaranteed Whilst it is the Fund's intention to invest mostly in companies qualifying under SEIS legislation, SFC cannot guarantee that all investments will qualify for S/EIS relief (or IHT relief) or, indeed, if they do initially, that they will continue to do so throughout the life of the investment. The tax advantages of investing through the Fund are therefore not guaranteed.  If you are interested in learning more about how to protect yourself, visit the FCA’s website here: [https://www.fca.org.uk/investsmart](https://www.fca.org.uk/investsmart)  Close Don’t invest unless you’re prepared to lose all the money you invest. This is a high risk investment and you are unlikely to be protected if something goes wrong. Take 2 minutes to learn more. [![SFC Logo + Title x web](https://sfccapital.com/hs-fs/hubfs/SFC%20Logo%20+%20Title%20x%20web.png?width=2000&name=SFC%20Logo%20+%20Title%20x%20web.png)](https://sfccapital.com) - [Startups](https://sfccapital.com/raise) - Investors - [SEIS Fund](https://sfccapital.com/seis-funds) - [EIS Fund](https://sfccapital.com/eis-funds) - [SEIS Explained](https://sfccapital.com/seis-explained) - [EIS Explained](https://sfccapital.com/eis-explained) - [Angel House](https://sfccapital.com/angel-house) - [Advisors](https://sfccapital.com/advisors) - [Portfolio](https://portal.sfccapital.com/portfolio) - [About Us](https://sfccapital.com/about-us) - [Blog](https://sfccapital.com/blog) - [Login](https://portal.sfccapital.com/login) # The Past & The Future of New Businesses. [Angelika Burawska, Chief Operations Officer](https://sfccapital.com/blog/author/angelika-burawska) SFC Capital's COO since 2014, uses her extensive business education and experience to drive operations, growth projects, and strategic implementation. - - 5 Apr 2018 [Startups](https://sfccapital.com/blog/tag/startups) ##### Share on - - - #### Startup trends: the story so far and what to expect in the near future Over the past 20 years we have seen a boom in startups following the same trends and in similar industries. This was a result of opportunities arising from the changes in society, new discoveries and the adoption of new technologies that became available to a wider public. **E-COMMERCE, MARKET PLACES AND SAAS** The Internet era really took off at the end of the 90’s and the beginning of the 00’s. Easy access to this new technology stimulated the digitalisation of services that so far were only available in the traditional ways. This is how e-commerce started. [Amazon](https://www.amazon.co.uk/), [eBay](https://www.ebay.co.uk/), and [Photo Box](https://www.photobox.co.uk/)are the best examples of businesses that were taking ‘offline’ activities into the online world and providing customers with better and faster solutions. During these years having an online store was often a good start to the entrepreneurial journey. Then, building an online market place started to be an even better business and can be considered as the second generation of ecommerce. Popularity of programming, creation, and adoption of new programming languages helped entrepreneurs to digitalise other services and sell them in a form of a SAAS (software as a service). **BIG DATA** A new opportunity arose soon after these developments. Growing Internet traffic and online activities provided big quantities of precise data. This gave ‘big data’ entrepreneurs their chance to enter the market and begin opening ‘big data’ startups. They came in all shapes and flavours, but generally had a form of software collecting, analysing and managing information. For long time ‘big data’ was a buzzword that not everyone understood, but that was very attractive and secured investment in many businesses. Some ‘big data’ startups made it, but many of them struggled to monetise and failed. Today ‘big data’ is not hot any more, but collecting and using data is considered a standard way of developing businesses. **APPS** The next big thing came with the wider use of smartphones. These devices quickly became powerful and started to assist us in daily life beyond just calling and texting. This is when the app era started. Budding entrepreneurs everywhere were coming up with hundreds of ideas for new apps. Apps made many people wealthy! Finding iOS and Android developers started to become a problem, but getting quick investment was fairly easy. Not any more. Today no one wants to invest in apps. The market is saturated and it’s clear that getting people to download yet another app is a big challenge and would require giant marketing budgets. Moreover, people expect apps to be free or to be an integral part of various services they get outside of their smartphones. **SHARED ECONOMY** The trend that is already passé, but had huge impact on social changes, is called ‘shared economy’. It all started with [airBnb](https://www.airbnb.co.uk/?from_belo_click) and stimulated a new generation of startups that were trying to build platforms of other things that can be ‘shared’ – not only homes, but parking spaces, storage, tools and even clothes and food. It’s not an easy space to make money on. Only few survived and grew including big names like [Blablacar](https://www.blablacar.co.uk/) and [Uber](https://www.uber.com/). The next one might be [HiyaCar](https://www.hiyacar.co.uk/): an app that enables car owners to hire their cars without handing over the keys! Although there are not that many ‘shared economy’ businesses, the few that made it, have had a huge impact on business and contributed to the growth of startups providing supporting services. **INTERNET OF THINGS** Adding Internet to the telephone turned out to be a good idea, leading many entrepreneurs to believe that there was no reason why other devices couldn’t be connected too– This is how IoT (Internet of things) was born. Today everything can, and should, be connected to the Internet. From home cameras, microwaves and washing machines, to home garden and doors – connecting our lives to the Internet is becoming standard. There is still some room for new businesses that want to make money in this space, but it has already started to be crowded and more challenging. **AI and MACHINE LEARNING** Now that our devices are connected to the Internet and many services can be done online, we expect them to be smarter and smarter. This was the start of the today’s trend: to apply machine learning and artificial intelligence. To put it simple – these are highly sophisticated mathematical algorithms programmed in a way that can acquire, interpret, analyse and save data. This type of intelligence can automatically add and create new information and add to the basis of what already exists using pre-programmed logic. There are hundreds of applications of AI and machine learning. One of them, trending now, is bots. The role of bots is to collect data and use it in a sophistically programmed way by giving the precise and quick output consumers expect. Bots are meant to help with flight bookings, recruitment, and even insurance and will improve as they continue to be developed. AI and machine learning will have a purpose in almost every aspect of life and can take on various forms. From apps like Siri, to Facebook chat bots, and devices like Alexa and Google Echo- It’s very difficult to see when the saturation point for AI will come. The space for improvement and further development is limitless. **AUGMENTED REALITY AND VIRTUAL REALITY** Another trend we are currently seeing is new startups using improved AR (augmented reality) and VR (virtual reality) technologies. These technologies are getting better, but the big change will come with their integration in various sectors. Augmented reality is an extra layer of information visible in the real world thanks to specially designed hardware and software. It will include glasses, apps, watches, and gloves- but there is no limit to what it can be, particularly if we think that all our devices are going to be ‘connected’ and smart. Virtual Reality is supposed to take us into totally different worlds. Startups developing in this space will provide better devices (lighter, smaller, more efficient) that can emulate all senses. At the moment it mainly uses pictures and sound, but soon it will include smell, touch, feel of movements etc. Other startups will use VR to built software. Not only will it be games, but also interview simulators, software to practise various skills and artificial worlds where we are going to meet other people. AR and VR is the long-term future that has already started. **BLOCKCHAIN** Finally, a wave of startups using blockchain technologies is coming. Blockchain provides a reliable, quick, and cheap infrastructure that allows users to do various actions. Additionally, block chain technologies like smart contracts, can automatically trigger new actions based on previously programmed assumptions as they are met. Blockchain is still mysterious and sometimes seen as a buzzword (see ‘big data’!) but is a proven technology. It’s mainly connected to bitcoin and other cryptocurrencies, but these are only the very first applications. There is no doubt that fintech is and will be the main sector where blockchain entrepreneurs will try to make money, but blockchain is going to revolutionise other sectors including legal and logistics. To summarise – we expect that new trends will develop in the following areas: AI and machine learning, AR and VR and blockchain. The first group will be companies that are improving the technologies and making them more efficient and easier to use. The second group will be startups applying these technologies in various sectors. With these new trends we will see hardware and software that is seamless, smarter and easy to incorporate into daily life. Startups that will fit into these trends will be more likely to find market and obviously, investors! ## Related Articles 19 Apr 2017 [Events](https://sfccapital.com/blog/tag/events) ##### [Startup Funding Club holds its first Investor Event after the first close of the 2017 SFC Funds at The Ivy](https://sfccapital.com/blog/startup-funding-club-holds-investor-event-after-first-close-of-2017-sfc-funds-at-the-ivy) Startup Funding Club announces the close of the first tranche of the 2017 SFC SEIS/EIS Funds at its ... [Read More](https://sfccapital.com/blog/startup-funding-club-holds-investor-event-after-first-close-of-2017-sfc-funds-at-the-ivy) 28 Oct 2020 [News](https://sfccapital.com/blog/tag/news) ##### [Meet the winners of The Beauty Accelerator™](https://sfccapital.com/blog/beauty-accelerator-winners) Faace and Fussy, winners of The Beauty Accelerator™ 2020 The Red Tree and SFC Capital are delighted ... [Read More](https://sfccapital.com/blog/beauty-accelerator-winners) 6 Sep 2023 [Investors](https://sfccapital.com/blog/tag/investors) ##### [The Rise of SEIS Funds for Investors](https://sfccapital.com/blog/the-rise-of-seis-funds-for-investors) SEIS funds and their generous tax benefits are about to become an even more attractive option for in... 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This website is intended for  professional investors, high net worth investor or certified sophisticated investors only for the purposes of the FCA's Conduct of Business Sourcebook.; any reproduction of this information, in whole, or part, is prohibited. The content is for information purposes only and should not be used or considered as an offer or solicitation to purchase or sell any securities. Investment in early-stage companies involves risks such as illiquidity, lack of dividends, loss of investment and dilution. Investment in SEIS/EIS eligible companies should be considered as part of a diversified portfolio. The availability of tax relief depends on individual circumstances and may change in the future. The availability of tax relief depends on the company invested in maintaining its SEIS/EIS qualifying status. There is no assurance that the investment objectives of any investment opportunity will be achieved or that the strategies and methods described herein will be successful. The investment products cited herein may place capital at risk and therefore investors may not get back the full amount invested. Past performance is not necessarily a guide to future performance and the value of an investment may go down as well as up. Investors may not get back the full amount invested. Companies’ pitches for investment are not offers to the public and investments can only be made by members of SFC Capital. SFC Capital takes no responsibility for this information or for any recommendations or opinions made by the companies. Neither SFC Capital nor any of its employees provide any financial or tax advice in relation to the investments and investors are recommended to seek independent financial and tax advice before committing. 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