9 of the fastest-growing industries to start a business, according to the founders of Ritual, Feed, and Kaiyo
Kaiyo/Ritual/FEED
- If you're starting a business in 2023, it helps to enter a lucrative market.
- Insider asked 68 founders for their predictions of 2023's best industries for business.
- Many listed AI, healthcare, wellness, cannabis, and e-commerce as promising sectors.
If you're starting a business in 2023, it helps to enter a market that's poised to grow in value and demand — especially as experts warn of a recession on the horizon.
The industries with the most potential will be the ones that can withstand a recession and won't be deterred by dwindling venture-capital funding, entrepreneurs told Insider.
Insider surveyed 68 founders for their predictions on the types of businesses with the most potential to succeed this year.
Of course, it's impossible to foresee the future, but these founders described how technology could transform new endeavors, how customers will want more sustainable products, and why they expected a big year for cannabis and psychedelics. Entrepreneurs might see big returns if they can tap into these demands.
Here are the best industries to start a business in, according to the founders' predictions.
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Of the many trends founders spoke of, artificial intelligence was the most frequently mentioned. Several founders said the technology would become more integrated into their industries and into society at large.
Austin Drabik, a cofounder of the hiring-technology company Helm, believes AI will have widespread adoption in 2023.
"We're seeing exponential growth in this space already, but the value and benefits are becoming more and more clear for its application to nearly every other industry," he said.
Matt Woodruff, a cofounder and the chief product officer of the software-as-a-service company Constellation, believes the tech companies that can innovate AI will gain significant market value.
"We already are seeing consumers dabble in the AI craze now, flooding Instagram with photos of them using AI art applications," he said. "The businesses who embed the right technology like AI throughout their processes and in every area of operations are the ones who will stand out in 2023."
While blockchain had a rough year — cryptocurrency values plummeted 60% — some founders said they believed the decentralized technology would make a comeback.
Ronan Levy, a cofounder and the CEO of the psychedelics-therapy company Field Trip Health & Wellness, compared last year's market crash to the dot-com bubble near the turn of the century.
"It will pave the way for smarter, more sophisticated, and better-managed blockchain companies to emerge and become a central part of the fabric of our economy and society," he said.
Tim Dierckxsens, a cofounder of the Web3 company Venly, sees blockchain and nonfungible tokens gaining momentum this year.
"Whether it is a business case around fan engagement, loyalty program, in-game asset ownership, royalty distribution," Dierckxsens said, "the technology is maturing, and the businesses are starting to see the benefits."
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The past two years have upended supply chains as we knew them: Manufacturing delays early in the pandemic became a regular occurrence, the war in Ukraine prompted global inflation, port blockages pushed import hubs east, and some companies pulled their manufacturing out of China.
"The industry has experienced intense volatility, and the pandemic showed a lot of cracks in the way our supply chain functions," Suki Mulberg Altamirano, the founder of Lexington Public Relations, said.
Now brands are investing in their own logistics to combat a long-term supply-chain crisis. Armon Petrossian, a cofounder and the CEO of the data company Coalesce, believes logistics, manufacturing, and energy markets will see unprecedented growth because of this.
"There will be a race to innovate to overcome the challenges in each of these industries and understand how businesses can leverage data to be more efficient in their processes," he said.
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Customers are becoming more aware of how the products they purchase affect them and the environment, so they're demanding healthier alternatives and more transparency. Founders expect this trend to reach far and wide, from fashion and technology to food and wellness.
"With the looming recession, people are going to take more things into their own hands to avoid expensive doctor visits and save costs," Cynthia Plotch, a cofounder and the CEO of the women's health brand Stix, said.
Katerina Schneider, the founder and CEO of the multivitamin and supplements company Ritual, believes cleaner and "better for you" brands are here to stay in 2023, from food and beverages to home goods and cookware.
"Over the last few years, we've seen a shift to consumers caring more than ever about their health, the transparency around the sourcing of ingredients, and the alignment around mission-driven brands," she said. "Additionally, it's no longer enough to be just clean; brands have to be clear with their standards around what is in their products."
While a recession may motivate customers to cut costs, Beatrice Dixon, a cofounder and the CEO of the feminine-care brand The Honey Pot Co., said people would continue to spend on groceries and essentials.
"The realities of coming out of several years of a pandemic have elicited a need for humans to prioritize wellness, namely what they put in and around their bodies," she said.
Chelsea Neman Nassib, the founder and CEO of the art marketplace Tappan Collective, believes customers are also becoming more socially conscious.
"People have become more considerate with their buying power and are looking for ways to spend that align with their values," she said.
Luis Gramajo, a cofounder of the cookie brand Wunderkeks, said customers were demanding more from the food industry, both in product quality and in branding.
"The new generations are buying brands that not only mean something to them, but also they feel represented by them," he said. "This is forcing companies to put a soul into their brands. We're seeing that trend in the food industry, and that's why it keeps growing."
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Just as customers are demanding higher-quality food and wellness products, founders say that sentiment is true for other consumer products, such as clothing, jewelry, and furniture.
Lauren Bush Lauren, the founder of the handbag brand Feed, said businesses offering long-term value would thrive this year.
"As an example, Patagonia offers products that are made to last, and the brand acts as a mentor for those of us seeking to lead a sustainable lifestyle," she said.
Alpay Koralturk, the founder and CEO of the furniture-resale platform Kaiyo, believes greentech and climate-focused companies would gain value this year.
"There's a large amount of federal money that will be deployed," he said. "VCs are also getting more interested in the space."
Carolina Cordon-Bouzan, the founder of the jewelry brand Montserrat New York, is hopeful that cost-conscious consumers will recognize lab-grown diamonds as a sustainable alternative to mined diamonds.
"The diamond-jewelry industry has been stagnant for years and is ripe for change," she said. "Millennials and Gen Z are looking for more environmentally friendly alternatives, while upholding quality in their jewelry purchases."
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The past three years saw huge growth for e-commerce brands. At the beginning of the pandemic, many companies that weren't previously selling online were forced to create e-commerce sites to cater to an influx of at-home shoppers.
Then, e-commerce sales hit record highs as entrepreneurs and side hustlers started their own brands online. Founders say this boom will continue, as shoppers have grown accustomed to online shopping.
"E-commerce is one of the fastest-growing industries, and I am sure it will continue to boom," Sivan Baram, a cofounder of the social-shopping platform Radd, said.
Wellness brands, in particular, could benefit from this trend, Gabriella Tegen, the founder and CEO of the e-commerce-subscription platform Smartrr, said, adding that the demand for supplements had skyrocketed since COVID-19's onset.
"Gen Z and millennials are especially embracing this trend," she said. "As a result, this group is fueling a new wave of lifestyle-product brands that are seeing a lot of success as online brands."
Of course, online brands are finding it harder to market on social platforms, so Jonathan Zacharias, a cofounder and the president of the marketing agency GR0, sees subscription models becoming a viable channel for companies to lean in to.
"The costs per acquisition for marketing are skyrocketing," he said. "The only businesses that make sense now in e-commerce are ones where you can afford to pay a lot for a new customer because they continue to buy the products."
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Many of the founders Insider surveyed saw 2023 as a big year for advancements in healthcare, from technology innovations and mental health to feminine care and sexual wellness.
Ariela Safira, the founder and CEO of the mental-wellness membership startup Real, believes that mental-health care will begin to be focused more on children.
"While mental health for the adult population needs changing urgently, kids' mental health is plummeting at a rate we've never seen before," she said. "From the pandemic to social media, this generation of kids is facing anxiety, depression, and self-harm at rates we've never seen before."
Ashley Tyrner, the founder and CEO of the produce-delivery service FarmboxRx, believes that healthcare will gain momentum in 2023 and innovation will reach rural locations.
"We are really beginning to look at a whole-person model of care" and "wake up to the realities that rural America faces when trying to access healthcare," she said.
Mulberg Altamirano, the founder of Lexington Public Relations, sees menopausal healthcare as a growing market.
"Women are seeking targeted health and wellness products at all stages of life, and this is poised to be a fast-growth sector," she said.
Daphne Chen, a cofounder and the CEO of the at-home STD- and STI-screening-kit company TBD Health, said COVID-19 had taught people the importance of preventive measures and routine testing. In the same way, she believes this innovation will translate to sexual wellness.
"As a result, there's been accelerated adoption of healthcare services like at-home testing that make it more convenient to get tested and treated," she said.
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In the past two years, several states have passed legislation to legalize cannabis for recreational use, including New York and New Jersey, which are expected to be one of the largest markets of legal cannabis in the nation. In 2022, New York City opened its first licensed recreational-cannabis dispensary, and Colorado became the second state to legalize medicinal psychedelics.
As more retail operations open in the US and business models mature, founders expect it to be a big year for the industry's growth.
Levy, the Field Trip founder, added that legalization efforts in Mexico, Thailand, and Germany could launch further opportunities.
"As the world continues to open up to cannabis, the cannabis industry will continue to grow into a massive sector," he said.
Payton Nyquvest, the founder and CEO of the psychedelics company Numinus, said the market for psychedelic medicine, which is becoming more common in the mental-health industry, was "on the cusp of realizing its potential."
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Resale is another industry that has been trending upward since the pandemic started — fueled by both an increase in entrepreneurs selling secondhand goods and a greater consumer interest in thrift shopping to recycle resources and reduce waste.
Abigail Price, the founder and CEO of the vintage-home-decor shop Abbode, thinks this trend will keep growing in 2023.
"The new-fashion industry is struggling, but the secondhand market is continuing to boom," she said. "Consumers are getting sick of fast fashion and looking like everyone else, and buying secondhand items has become completely normalized."
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Last year, at least 52 major companies announced layoffs. So far, prominent firms like Amazon, Salesforce, and Compass have said they will cut staff this year.
As more people are looking for work, Lola Bakare, the founder and chief marketing officer of the marketing agency Be/Co, said everyone was looking to revamp their personal branding.
"My colleagues in that space are making bank," she said. "The age of the professional micro influencer is just getting started, especially for B2B companies who need quality, not quantity, when it comes to leads."
Contributer : Business Insider https://ift.tt/pUXaqwY
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