Top 10 Investment and Technology Predictions for 2024

As we stand on the precipice of a new year, the intersection of investment and technology beckons with unprecedented, innovative promise in 2024. Driven by existing and emerging trends across the ever-evolving innovation landscape, 2024 is poised to be a pivotal and transformative chapter in the journey to the frontier of the future. Casting a spotlight on the dynamic and revolutionary forces shaping the investment and technology markets, the following predictions offer a glimpse of what we can expect in the year to come.

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Prediction 1: Rebound in M&A and Exit Market Activity  

Following relatively muted and tapered M&A and exit market activity, we will likely see a resurgence as we progress throughout the year. With an increasingly favorable financing and market environment, investors and enterprises can capitalize on strategic investment opportunities, particularly those related to AI initiatives and technology. Although this will stimulate markets, provide liquidity, and quicken the pace of consolidation and integration, it’s also likely to spur greater regulatory scrutiny and competitive pressure.

Drivers:  

• Increasingly favorable financing environment enabling borrowing and spurring PE investment activity  
• Improved public market dynamics, empowering public companies and incentivizing private companies to pursue M&A initiatives  
• Liquidity pressures and expectations from LPs following muted distribution and exit environment
• Competitive and operational pressures to capitalize on accretive and bolt-on AI transactions  

Implications:

• Wave of consolidation across different markets and industries  
• Greater opportunity and pressure for regulatory agencies to take a more aggressive policing stance  
• Exit activity generating liquidity for new funds, opportunities, investments, and allocations  
• Quickening pace of AI integrations among large and established enterprises  
• Shifting competitive and channel dynamics, creating new partnership ecosystems and opportunities  

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Prediction 2: Thawing of IPO Markets  

Frozen mainly over the past year, IPO markets will gradually and incrementally thaw throughout the year. As public markets gain support and clarity alongside rate stabilization, there will be greater incentive and pressure to go public, particularly for companies that had to suspend their IPO plans or have investors seeking overdue exit liquidity. Led by high expectations for Databricks, there is a diverse and robust pipeline of potential IPOs for 2024 that is likely to stimulate further market activity and support.  

Drivers:  

• A favorable financing environment paired with receptive and supportive public market dynamics  
• Liquidity and exit pressures amidst a favorable public market environment  
• Robust and diverse IPO pipeline expectations (Databricks, Stripe, Shein, Reddit, Rubrik, StubHub)

Implications:

• Activity to pick up in 2H24, led by greater rate and market clarity
• Highly successful Databricks IPO to lead 2024 activity  
• Potential stimulation and generation of greater liquidity, M&A, and investment activity  
• Slowly and incrementally supportive valuation growth  
• Select positive IPO reception to bring forward the timeline of IPO pipeline

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Prediction 3: Biotech Builds on 2023 Momentum  

Beyond the AI headlines, 2023 represented a subtly robust year for the biotechnology industry vertical. Biotech continued to dominate emerging technology funding from leading VC firms and has seen strong recent tailwinds resulting from technological advancements, emerging therapeutics, and an acceleration in approvals. These circumstances and dynamics leave the industry well-poised for another momentous year heading through 2024.  

Drivers:  

• AI and gene editing advancements accelerating novel research and development  
• Momentum and traction behind emerging weight loss therapeutics  
• Resilient and robust VC support, representing the top emerging tech vertical funded by leading VC firms in 7 of the last 11 quarters  
• Reacceleration in FDA approval process, with novel approvals rising nearly 50% year-over-year in 2023
• Rise in laboratory copilots and automated lab technology speeding up research and development efforts

Implications:

• Growing pipeline of novel therapeutics for commercialization, potentially slowing FDA approval rates  
• Acceleration in discovery, research, and development timelines  
• Technology advancements enabling cost-savings and efficiency enhancements translating to greater investment and innovation  
• Stimulated vertical M&A and investment activity  
• Advancing maturity and traction among specific industry-tailored AI solutions and platforms  
• Emergence of new monetization and service opportunities across biotech and broader healthcare vertical

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Prediction 4: Infrastructure Modernization

Political and legislative support, a favorable financing environment, and the need for advanced and supportive technological infrastructure will drive widespread modernization efforts across industries, particularly capital-intensive sectors. New technological and infrastructure modernization efforts will yield operational, cost, and resource efficiency improvements, serving as an increasingly important competitive differentiator and necessity. Modernization initiatives and shifting geopolitical and market dynamics can also accelerate the transformation of traditional business models, systems, and service offerings, creating new opportunities for monetization and innovation.  

Drivers:  

• Lower financing costs spur investment in asset and infrastructure modernization  
• Public investment support and subsidization behind critical industries and infrastructure development (IIJA, CHIPS Act)
• Geopolitical disruptions and externalities on energy, commodities, transportation, and supply chains reinforce the advancement of sustainable and resilient alternatives  
• Increasingly compelling cost savings and cost efficiencies in modernization and innovation initiatives  
• Emerging technologies generating the need and demand for greater infrastructure capacity, connectivity, generation, and efficiency
• Quickening pace of innovation converging with an accumulation of technical debt and emerging technologies acting as a catalyst behind transformative initiatives  

Implications:

• Capital-intensive industries (manufacturing) investing in transformative technological initiatives to capitalize on emerging efficiency and monetization opportunities
• Growing momentum behind reshoring and nearshoring initiatives for greater flexibility, resiliency, visibility, and control  
• Integration of new technologies and modernization of existing systems and assets, generating newfound productivity, efficiency, and cost-savings for further innovation, investment, and expansion
• Renegotiation and reevaluation of existing contracts, suppliers, and materials, yielding new strategic opportunities  
• Movement to on-demand and modular business models to capitalize on new service opportunities and achieve greater insulation from externalities  
• Emergence of new service, monetization, and business opportunities with modernization initiatives, such as data management and predictive maintenance

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Prediction 5: Aggressive Regulatory Posturing  

Regulators have demonstrated an increasingly aggressive posture in scrutinizing industry practices, market activities, and company and actor behavior. With an expected rebound in M&A activity, rising geopolitical and social pressures, and accelerating innovation across important technologies, regulators are poised to continue to exhibit greater scrutiny and proactive policing. Alongside evolving and emerging regulatory frameworks, enterprises will face an increasingly challenging and complex operating environment. As a result, regulatory headwinds may limit opportunities and require investing in and adopting new technologies, practices, and partners.  

Drivers:  

• A recent willingness by regulatory bodies to take more aggressive stances in scrutinizing actions, policing market activities, and enforcing regulations  

• An expected rebound in M&A initiatives spurring more active positioning by regulators  
• Rising geopolitical and trade tensions leading to greater regulatory scrutiny  
• Political and social pressures leading to regulatory action  
• Growing integration of emerging technology with important national functions and security interests  
• Quickening pace of advancement and adoption among innovative technologies (AI, quantum, transportation, energy), yielding new regulatory frameworks  

Implications:

• A potential headwind and tempering of M&A initiatives, particularly larger and PE-backed initiatives  
• Growing enterprise prioritization of and investment in regtech, legal, compliance, and governance technologies  
• Successful challenges from regulatory bodies serving to establish precedent and momentum for further action
• Rising strain on foreign investments leading to potential deceleration in certain industries  
• Potential trepidation in the advancement and embrace of certain technologies and industries until further regulatory clarity is established  
• Increasingly complex international environment for enterprises to navigate and operate in, leading to new partnership, service, and business opportunities  
• Evolving frameworks and considerations generating potential business and operational disruptions  

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Prediction 6: Sustained Supply Chain Disruptions

An expected continuation of volatile geopolitical tensions and uncertain regulatory, resource, inflationary, and labor dynamics is set to lead to persistent and pervasive supply chain disruptions. These trends will continue to push enterprises to prioritize new service offerings, technology, and strategic initiatives designed to provide greater visibility, resiliency, and stability. Disruptions will also generate headwinds regarding production timelines, resource availability, and cost structures, potentially limiting innovative technological advancement and development.  

Drivers:  

• Escalation in geopolitical tensions and global conflicts generating continued volatility  
• Continuation in unionization efforts and labor disruptions, particularly driven by recent momentum and displacement concerns  
• Key resource scarcity and shortage provide additional disruptive pressure  
• Progressive decoupling initiatives of intertwined global technology supply chain  

• Inflationary and geopolitical impact on resource and input sourcing and costs  
• Impact of emerging and evolving regulatory frameworks by individual nations and regions  

Implications:

• Momentum behind nearshoring and reshoring initiatives to provide insulation from global volatility  
• Prioritization behind supply chain visibility, planning, procurement, regtech, digital thread, and other technologies/services designed to improve resiliency  
• Growing research, development, and use of sustainable advanced materials and alternative energy resources  
• Reevaluation of supply chains, partner networks, and contracts amidst an evolving financing and regulatory environment  

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Prediction 7: Vertical Liftoff  

Driven by competitive pressures, regulatory progression, and technological capability, 2024 will take humans closer to the skies and space through satellite, eVTOL, and drone advancements. As a result, we will see progress in supportive infrastructure, regulatory alignment, and a growing set of proven applications. In addition, there will be an accompanying rise in commercial, market, and investment support and geopolitical and supply chain tensions.  

Drivers:  

• Intensifying and accelerating competitive pressures between emerging and established satellite and aerospace operators
• Competing pressures over regulatory reforms of the aerospace market and operations  
• Incremental progression in regulatory approval, development, production, and commercialization of eVTOLs
• Expanding OEM, airline, and eVTOL partnership ecosystem accelerating development  
• Growth in tailored applications of smaller-scale drone applications providing proof of concept support and traction

Implications:

• Partnership and investment in infrastructure modernization efforts to accommodate evolving transportation system needs  
• Pressures and advancements contributing to the emergence of an evolving regulatory framework  
• Reliance on government contracting and small-scale commercial delivery for initial monetization and proof of concepts  
• Escalation in trade restrictions and disruptions around key technological inputs and components  

• Shift and expansion in supply chain, transport, and last-mile service offerings  
• Incremental advancement and convergence in capability, application, and capacity  

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Prediction 8: Web3 Signs of Life

Following controversies, setbacks, and disasters, 2024 may represent a bottoming out and stabilizing, if not a turning, point for supportive web3 technologies, including extended reality (XR), blockchain, and cryptocurrency. As these technologies gain accessibility, practicality, and regulatory clarity, specific and tailored applications may serve as an initial foothold for further refinement, advancement, and support.  

Drivers:  

• Continued development and competitive pressures from XR hardware and software providers, notably Apple and Meta
• Growing regulatory clarity and framework governing cryptocurrencies and related technologies  
• Acceleration in production and sophistication of supportive hardware, including GPUs, chips, and wearables  
• Potential for a rebound in investment support and the emergence of new monetization opportunities
• Marginal improvements in accessibility  
• Institutional and regulatory support for a Bitcoin ETF driving activity, support, and adoption

Implications:

• Improving practicality and value behind virtualization technologies for specific industry applications  
• Growing demand and strain on computing, storage, and processing demand and capacity  
• Progressive pressure and clarity around regulatory frameworks and considerations  
• Potential introduction of expanded attack surface and evolving cybersecurity risks and considerations  
• Expanding technological connectivity, collaboration, and functional opportunity set  
• Incremental expansion in institutional and enterprise support, development, and investment  

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Prediction 9: AI Hardware Integration  

With the explosion and proliferation of AI software during 2023, in 2024, we will start to see a growing push for hardware integration, whether through wearables, industrial assets, or technology interfaces. This will accelerate partnership formation, AI functionality, and advancement, reinforcing cybersecurity, governance, regulatory, and geopolitical concerns. The gradual integration of AI with hardware across industries and use cases will drive continued investment support and advancement in functionality, accessibility, and developmental maturation.  

Drivers:  

• Continued development and maturation of AI, providing hardware integration as a competitive and proprietary differentiator  
• Natural and historical evolution and progression of technological innovations  
• AI innovators and operators developing hardware and partnerships for integration  
• Large and established technology firms integrating proprietary, partner-developed, and open-source software with hardware offerings  
• Competitive and technological pressures and synergies from device makers and emerging supportive technology  
• Growing traction and momentum behind open-source offerings
• Expanding and improving device capability, performance, and capacity  

Implications:

• Progressive acceleration of AI integration, advancement, and pervasiveness
• Quick and aggressive competitive positioning from large, established operators and startups  
• Growth in cybersecurity risks, threats, and considerations driving a focused prioritization of AI security  
• Potential uplift in attack vectors, techniques, and frequency, further straining IT/cybersecurity resources  
• Continuation in a supportive investment environment as investors and firms rush to capitalize on emerging opportunities  
• Strengthening push and pressure around regulatory and governance frameworks, including privacy, fairness, security, accountability, and explainability
• Growing collaboration opportunities and hardware-software partnership ecosystems  
• Escalation in geopolitical trade tensions as AI integration spreads across important industries, devices, and hardware

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Prediction 10: Advancing Autonomous Agents  

Advancing capabilities across various innovative and emerging technologies and social, regulatory, and enterprise pressures will drive the continued refinement of autonomous technological applications and agents. Although prevailing regulatory and operational challenges will temper this trend, we will see incremental advancement in autonomous agent sophistication, application, and effectiveness.  

Drivers:  

• Social and regulatory pressures and prioritization of safe and trustworthy autonomous automobiles  
• Progressive advancement and integration of AI maturation and capability
• Growing development and use of autonomous drones across various small- to mid-scale applications  
• Resource and operational constraints driving adoption to achieve improved optimization and efficiency  
• Continuation of robust investment support spurring research, development, and advancement  
• Expanding capacity, capability, and functionality of supportive technology and infrastructure  

Implications:

• Incremental increase in enterprise productivity and efficiency  
• Agent and application refinement and regulatory alignment through testing processes
• Formation of clear governing and regulatory frameworks through industry and policy collaboration
• Development and spread of tailored and vertical-specific applications providing proof of concept and advancement support
• Convergence in standardization, best practices, and governing frameworks  
• Heightened and expanding sophistication of cybersecurity and technological trade risks
• Reduced consumer skepticism, improving accessibility, trust, and utilization  

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Conclusion

As we reflect on the ten predictions explored above, it becomes evident that the future is not just unfolding—the dynamic interplay of innovative forces across technology and investment markets is actively shaping it. As we traverse uncharted territory this year, let these predictions serve as guideposts for navigating the evolving landscape of opportunities and challenges. The journey continues in the unfolding narrative of investment and technology, and the chapters yet to be written promise a story of innovation, growth, intrigue, and complexity.

Are you interested in knowing more about the latest market predictions? Our Research & Insights team is always looking for what’s changing in the market. Get in touch today to learn more about how our team can help you navigate 2024 with actionable research and insights.  

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