According to Gartner, a market research firm, there is still growth prospect in startups, despite a slow pace of growth when compared to the last decade. In the the last two years, small private companies got excess of $1.3 billion dollars from investors to speedup or rampup or even startup their companies. The key areas are analog startups, wireless connectivity firms and even optics in the semiconductor industry.
Looking at the market, there is still a huge opportunity for innovative startup companies in the industry. They are usually bought over by bigger players that need critical core technologies to stay competitive. In some cases, their vendors buy them.
The summary of the Gartner report is as follows.
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- In the industry, VC goes for later stage startups with some products or working prototypes
- The number of startups newly formed is lower than what it was abbout three years back. And when benchmarked with last decade, this decade rate is lower
- Most of the firms in the report are in speedup cycle and have revenue generating operations
- Most cases, big vendors invest in startups to lock up new technologies
- Investment averaged $12.4 million startup