Illustration photo. If technology was the key constant in the 2008 innovation wave, that trend looks set to continue in this crisis
The 2008 financial crisis gave way to hundreds of successful new global businesses or products and services that today we can’t live without. So, what new products and services will emerge from the current crisis?
Whatsapp, Airbnb and Uber were all developed or launched in the aftermath of the 2008 financial crisis, showing how innovative startups can emerge from economic crises.
The early signs are looking promising for Luxembourg’s startup scene at least in terms of the volume of people catching the entrepreneurial bug.
“We got more requests in 2020 from people willing to launch their business than in 2019,” Lucile Barberet, CEO of startup support platform Nyuko told Delano. Even if they were only from “very early-stage entrepreneurs” interested in established “one-person companies”, Barberet says it shows people have used this extraordinary time to “reflect on their professional path and felt the urge to change it.”
A similar trend was noted across several support structures for startups and entrepreneurs in Luxembourg. The University of Luxembourg Incubator, which in recent years nurtured successful projects Magrid and Food4All, received 17 new startups.
“It was a phenomenal number as we’ve only been around for 3 years and currently have 35 active startups either hosted within the University of Luxembourg Incubator itself or going through its venture mentoring service,” said incubator coordinator Ielizaveta Shliakhova.
Co-founder of Food4All Ilana Devillers is pictured in this archive photo. Photo: Matic Zorman
The Luxembourg House of Startups (Host) observed a surge in interest from people in the “cautious early implementation approach. It revealed more pragmatism in assessing the turbulent business environment’s strengths and weaknesses to launch the project effectively,” said Host’s François Legaré.
Meanwhile, Luxinnovation saw participation in its Fit4Start startup programme almost double, from 476 in a single edition in 2020, compared to 512 in two editions in 2019.
If technology was the key constant in the 2008 innovation wave, that trend looks set to continue in this crisis, which has “accelerated the pace of digitalisation,” said Luxembourg House of Financial Technology (Lhoft) chief Nasir Zubairi. He said: “What probably would have taken us 10 years, we've gotten to a point within a year.”
He cited the explosion in online food ordering services, services facilitating digital board meetings from which resolutions are recorded in the blockchain and digital payments.
A government call for covid-related solutions also resulted in a slew of technology-based, “innovative products and services intended to limit, or even overcome the economic, health and societal effects of covid-19,” said Stefan Berend, Luxinnovation's head of startup services.
Luxinnovation relations and support director Johnny Brebels added: “Some companies worked actively to fill the gaps concerning the lack of personal protective equipment.”
Luxembourg House of Financial Technology director Nasir Zubairi is pictured in this archive photo. Photo: Matic Zorman
What will sustain beyond the crisis?
If this is a golden era for entrepreneurship, it is not clear how much of the new innovation will be sustained beyond the pandemic. Zubairi believes that for some new digitised products there is no going back. He also reckons the greatest longevity will be found in tokenisation platforms.
“With this increased use of digital comes the issue of protecting digital, so I think cyber security is going to explode in terms of firms dealing with cybersecurity issues,” he says. Berend agrees that cyber security will be strategically relevant to Luxembourg, as will “applications in relation to climate change.”