Entrepreneurs have seized the opportunity to start new companies in a wide variety of industries during the COVID-19 pandemic. While not all of these ventures will be successful, businesses that help alleviate some of the new challenges created by the pandemic are poised for long-term growth. Here are three industries that hold promising opportunities for entrepreneurs looking to start new businesses.
1. Contactless tech
One of the most significant business opportunities is directly related to one of the most widespread problems of the COVID-19 era: the risk of virus transmission in shared spaces such as retail stores. Many grocery stores and other businesses had already upgraded their point-of-sale systems to allow customers to pay using a smartphone or contactless card before the pandemic. And there’s been more interest this year in ‘cashierless’ systems like those used at Amazon Go stores, says Laura Kennedy, senior lead retail analyst at research firm CB Insights. Companies are also developing more self-service options, such as Vengo Labs’s “smart” vending machines and Valyant AI’s voice-enabled kiosks, to let customers order everything from salads to cosmetics samples with minimal contact. While there was plenty of hype around these technologies before, Kennedy says, the pandemic has accelerated existing trends. And retailers will continue to embrace ways to speed up transactions and provide shoppers with more ways to buy.
Already a growing industry, telehealth quickly emerged as a practical alternative to nonessential doctor’s appointments after the pandemic led to new rules around in-person visits. Even after a coronavirus vaccine becomes available, people who used telehealth services will likely keep using them for the sake of convenience.
During just a six-week period between February and April, startups in the space raised $190 million. Revenue for companies in the $3.2 billion telehealth industry is expected to grow 8.3% per year during each of the next five years according to an August 2020 report by market research company IBISWorld. The industry includes virtual primary care, teletherapy, health insurance tech, pharmacy services, home testing kits, and devices and apps for remote patient monitoring. While companies in the industry must comply with strict regulations regarding patient privacy and medical device approval, experts predict telehealth will become standard practice for many providers.
3. Education tech
The pandemic forced schools to digitize fast, and online learning will likely remain a core component of education even after in-person classes resume, according to a September report by CB Insights. Revenue for ed-tech companies also increased by more than 300% on average between March and July, according to a survey by software-development company Rootstrap. These companies include management platforms where teachers can plan lessons and track students’ progress, online tutoring services, supplemental tools like math games, and massive open online courses (MOOCs) for higher education.
Outschool, which offers online courses for kids three to 18, signed up 37,000 new students in the last two weeks of March alone, according to the company. Still, there are downsides that could hinder the adoption of new technologies, such as privacy concerns, high costs for already cash-strapped school districts, and accessibility: Students can’t learn online if they don’t have personal devices and a steady internet connection. But with the virtual school year off to a rocky start in many areas, there will likely be continued demand for more reliable solutions.