Was edge computing the death of IoT? Did research drive the blockchain hype or vice versa? How has the WeWork debacle affected the appetite for sharing economy projects?
As founders looking to raise series A funding, we had more than a casual interest in investment trends. While most founders can get an intuitive sense of the market through personal contacts and media coverage, we wanted to try a more scientific approach.
Using our text analysis software, Lexikat, we sorted and analysed ten years’ worth of data from the Factiva media database.
The results might surprise you…like they did us.
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Hunt for the next big thing
We used our own software to pick out the keywords and phrases used in articles about tech startups and separated them by sector. We then combed through ten years of media data to search for the key trends in each field, counting the number of articles mentioning these topics as a proportion of the total number mentioning startups.
Conclusion: the generalist press is a pretty good indicator of investor sentiment. Mentions of blockchain, for example, peaked during the 2018 Bitcoin boom, while interest in IoT projects began to decline as edge computing gained ground.
Also read: The 10 most read blockchain e27 Contributor articles
One place where these trends were not reflected was tech-focused media. Wired, for example, was almost entirely unaffected by trends elsewhere, focusing instead on sectors that can be relied upon to appeal to affluent geeks: gaming, robots, the environment…
Ni hao China!
Different language markets also showed different trends. Having dealt with both the English and Chinese markets for our own software, we were keen to see a statistical comparison of the two.
Unsurprisingly, Chinese media responded less strongly to the Bitcoin spike: while China has millions of crypto speculators, the government is ambivalent about blockchain technology, and the topic receives limited coverage in the mainstream press.
On the other hand, big data topics attracted much more interest among Chinese media outlets than in their English-language counterparts. This is probably largely down to coverage of the Chinese government’s use of big data in projects such as the social credit system.
Indeed, when it comes to market sentiment, zone boundaries seem to be determined by language as much as by geography (if not more). Asia-based English-language publications tend to reflect trends in the wider English-speaking world. Deal Street Asia and E27, for example, aligned more closely with English trends than Chinese ones.
Could there be future possibilities for arbitrage between the two markets? Stay tuned…
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