techcrunch.com http://techcrunch.com/2014/12/31/7-venture-capitalists-predict-what-will-happen-in-2015/?ncid=tcdaily

By JonathanShieber

7 Venture Capitalists Predict What Will Happen In 2015

From cloud wars to the certainty that there will be hacks, venture capitalists believe that 2015 will be a year oftumult and (in public markets anyway) triumph for the startup world.

Here are the visions that the general partners, managing directors and partners from firms such as NEA, IVP,Cue Ball Group,General Catalyst Partners and MDV have when they gaze into their crystal balls.

Together these firms have more than $22 billion under management, so theyre not only seeing the future, theyreoften shaping it.

1. Jon Sakoda, General Partner, NEACloud Wars The Empires Strike Back: The cloud computing wars started years ago, but, largely speaking,Amazon has been uncontested and has quietly become the dominant player in the space. In 2015, Amazon willface a multi-front war as Google will launch its assault on Amazons traditionally strong presence in thedeveloper ecosystem, and Microsoft will combat Amazon in the enterprise market by re-doubling its efforts onAzure.

Legacy Titanics Icebergs Ahead: We will see more unbundling of legacy software companies. The disruptiveforces that have pushed HP and Symantec to break up their operations in order to compete with new entrants willaccelerate as activist investors and private equity owners push to maximize the value of these existing assets.Look for significant moves from Microsoft, EMC, VMware, Citrix, and Dell in the next year.

2. Tony Tijan, Chief Executive and Managing Director, Cue Ball GroupThe Promise of Payments: Despite heightened focus, increased investment dollars and strong media buzz

around a revolution in the payments space, there has been relatively little tangible change in the way we pay forthings. NFC payment hasnt taken off despite the introduction of Apple Pay, POS integrations are incrediblyfragmented and interchange fees are being driven toward zero.

Wearables Werent Quite Ready: There was much excitement around wearable technology, but practical usageisnt quite there so adoption has been low. While there were some notable product releases, wide-spreadadoption and everyday use is still not at hand. For that to happen, creators need to figure out use cases andapplications that genuinely simplify everyday tasks, rather than complicate them. 2015 will feature greaterentrepreneurial enablement. For example:

Bigger, Better Deals: With a 21 percent decline in funds but a 40 percent increase in dollars raised, we areseeing larger funds spread across fewer firms. In 2015 we can expect to see the average deal size increase withan uptick in later growth rounds.

Tech Enablement Creates More Entrepreneurs: Real-time and mobile services have empowered a newsegment of workforce that thrives on flexible and independent work. This has enabled those that arent able to (orsimply dont want to) fulfill 9-5 jobs to enter the workforce and creates a prevalence of non-traditional careers inservices. In 2014 in the U.S. alone, there are 18 million independent workers. Expect that number to increase atsharp rates in 2015.

Government Empowers & Creates Even More Entrepreneurs: 2014 saw changes in policy that enable theentrepreneur with greater independence and freedom. More lenient immigration policies will allow people topursue entrepreneurship, while affordable individual health care makes traditional employment less of a draw.These policy changes will drive a massive influx of entrepreneurs in 2015 and beyond.

3. Steve Herrod, Managing Director, General Catalyst PartnersDeconstruction Of Traditional IT Applications: Independent of whether this will be driven by startups or byGoogle, there will be a shift in how and where companies do business in the future leveraging SaaS models andmoving away from the stranglehold of traditional ENT software vendors like Microsoft, Oracle, SAP and others.

Network Virtualization: Virtualization will continue to rise in popularity and finally take the main stage innetworking we have seen this starting to take place with the acquisition of Nicira and ACE.

There Will Be Hacks: As we move into 2015, security breaches will continue to happen as companies work topatch holes in current software and networks. Trying to stay one step ahead of hackers with the latest software orsecurity features isnt going to be enough; companies will need to work together in order to combat and fight themoff.

4. Neil Sequiera, Managing Director, General Catalyst PartnersThe End Of The Superstore In Verticals: First it was Circuit City, then Radio Shack, followed by Best Buy.There is still a place for Walmart and grocery stores but not vertical players in alternative commerce. That is werethe web and mobile win. With companies like The Honest Company, there will be a rise of vertical commerce witha unique connection to the customer directly.

The Downside To Consolidation And Failure Of Media Properties: Consumers realize that this isnt a goodthing AT&T plus Direct TV, Comcast plus Time Warner Cable. The fewer people there are to compete on theprice of cable, phone and, most importantly, high-speed data, as well as provide thoughtful journalistic integrity isa concern and the consumers will realize this in 2015.

5. Katherine Barr, Partner, MDVNew Enterprise Trend: Labor and Workforce Innovation: Until a decade ago, machine learning (ML) and artificialintelligence (AI) were relegated to research labs, technical publications, and big-budget science fiction films. MLand AL have crossed the chasm and will have a profound impact on the way businesses work. Pairing human

workers with machine learning and automation will transform knowledge work and unleash new levels of humanproductivity and creativity. Without the advances in automation, the swelling volume of data would overwhelmknowledge workers and cripple businesses.

A New Era in Retail and Commerce Innovation: The traditional retail infrastructure and supply chain logistics aswe know it is being disrupted by companies creating new technology platforms and data-enabled distributionsystems that have predictive analytics, better customer profiling, deeper consumer engagement, blended onlineand offline data, and more agile supply chains. The supply-chain has been fragmented and inefficient for years,particularity with the delivery of heavyweight goods to the consumer, which until now have been expensive andcomplex. E-commerce platforms are being transformed for the consumer and the manufacturer by leveragingpowerful analytics and forecasting tools helping to alleviate last mile (i.e. from warehouse to consumer) problemthat is the key logistics issue where most of the cost, complexity and fragmentation lies, especially with thedelivery of heavyweight items.

Life Tech Will Take on New Life: In life, time really is money, and a major source of time is spent on home andfamily tasks. Life tech allows digitally-enabled services, intelligent personal agents and mobile-device-enabledcommunication and collaboration infrastructure to truly optimize consumers lives. Similar to how ERP helped toorganize the business side of our lives, life tech promises to organize the personal side of our lives In addition tocompanies like Nest. Other companies, such as TicketFly and Ruby Ribbon, have products and services thatoptimize, personalize and automate our lives as consumers and are creating a smart world that shifts andresponds to our needs.

6. Jules Maltz, General Partner, Institutional Venture PartnersThe IPO Market: The IPO market will stay open, but a large number of tech companies will price their IPOs belowthe price of their last private financings.

7. Sandy Miller, General Partner, Institutional Venture PartnersTech IPOs: I think 2015 will be the best year since the bubble for venture-backed tech IPOs. We have had asolid year in 2014 and the deals late this year are working well. There is considerable institutional investorappetite; they have made good returns on tech IPOs this year. Most importantly, there are an unprecedentednumber of high-quality, private, venture-backed tech companies of real scale ($50 million or more in annualrevenues) and growth (30-50 percent top-line growth).Featured Image: Arallyn!/Flickr UNDER A CC BY 2.0 LICENSE 2013-2015 AOL Inc. All rights reserved. Aol Tech Privacy Policy About Our Ads Anti Harassment Policy Terms ofServicePowered by WordPress.com VIPFonts by

7 Venture Capitalists Predict What Will Happen In 20151. Jon Sakoda,General Partner,NEA2. Tony Tijan, Chief Executive and Managing Director, Cue Ball Group3. Steve Herrod, Managing Director, General Catalyst Partners4. Neil Sequiera, Managing Director, General Catalyst Partners5. Katherine Barr, Partner, MDV6. Jules Maltz,General Partner, Institutional Venture Partners7. Sandy Miller,General Partner, Institutional Venture Partners