Venture Capital Blog

High-growth tech investments are attracting interest from experts worldwide thanks to the future prospects of this sector. S&P forecast statistics for 2024 indicate that the tech segment will likely grow by 29% in earnings. By 2025, this percentage is expected to reach the 17% mark. If you’ve been considering investing in high-growth tech companies, this is a great time to scout around for options. 

And, if you have questions about the specific sectors in which to purchase ETFs, you’ve come to the right place. Read ahead for in-depth information.

Top High-Growth Tech Investments to Consider

Technology has quickly become crucial for the functioning of organizations of all sizes across the board, regardless of their vertical. The tech function is positioned as the driving force and strategic partner that not only streamlines operations but also advises on business planning and decisions. 

For this reason, companies are ramping up their spending on adopting and integrating tech capabilities. The expert analysts at NVDA bull ETL recommend three core disruptive technologies that will see traction in the coming years. They are robotics, Artificial Intelligence (AI), and Cloud Computing.

Robotics

The robotics sector is projected to grow at a Compound Annual Growth Rate (CAGR) of over 16% from 2022 to 2030. In dollar values, that translates to $218 billion to $62.7 billion within this time frame. Companies are adopting robots and automation to perform several tasks, mimicking humans but with exceptional speed, efficiency, and a low propensity for error. 

Robots excel at every task, from making a cup of coffee to driving and performing complex actions. They can potentially disrupt the labor market, and service and industrial robots are in high demand. 

Some of the top-performing ETFs include iShares Automation & Robotics UCITS ETF, L&G ROBO Global Robotics and Automation UCITS ETF, and Xtrackers MSCI Global SDG 9 Industry, Innovation & Infrastructure UCITS ETF 1C.

Artificial intelligence (AI)

The Artificial Intelligence (AI) sector is estimated to grow at a CAGR of 42% from 2022 to 2032. Translated into dollar value, that works out to a growth from $40 billion to $1.3 trillion. AI mimics human intelligence in computers, machines, and automated devices and ensures higher speeds and accuracy with minimal margin for error. 

Similar to the human brain, AI can receive, process, store, and deliver data and information. Moreover, as it continues to be deployed, it performs with higher efficiency. And that makes it one of the high-growth investments in today’s markets.

Different industries may use AI to enhance decision-making processes, lower costs, and automate back-office operations. Some of the top-performing ETFs include ROBO Global Artificial Intelligence ETF (THNQ), Wisdom Tree Artificial Intelligence Ucits ETF, and ROBO Global Artificial Intelligence ETF.

Cloud Computing

The cloud computing sector is expected to grow at a CAGR of 20% from 2023 to 2030. Expressed in dollar figures, this translates into an increase from $678 billion to $2.4 trillion. 

In recent years, companies have quickly realized that maintaining on-premises data storage solutions is no longer practical. Integrating cloud storage not only frees up space but is much more cost-effective, not to mention secure with on-demand access. Organizations can also scale their operations by leveraging automation, robotics, and AI.

A cloud computing provider plays a crucial role in this transformation. These providers offer a range of services that enable businesses to store, manage, and process data remotely. By using cloud computing services, companies can reduce their IT infrastructure costs, improve efficiency, and ensure data security.

Providers also offer specialized solutions such as Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS), allowing organizations to choose the best options tailored to their needs.

Some of the top-performing ETFs include Amplify Global Cloud Technology ETF, First Trust Cloud Computing ETF, and Fidelity Cloud Computing ETF.

Additional Sectors Attracting Investor Attention

Aside from these three main sectors, several other high-growth tech investments are making waves on the exchange. For instance, blockchain technology, the Internet of Things, genomics, autonomous and electric vehicles, cybersecurity, and Technology-as-a-Service. Investors should also be aware that the tech sector is evolving rapidly, with new innovations appearing all the time. 

While investing in top-performing ETFs is a smart move, you might want to consider upcoming startups with unusual and disruptive ideas. To invest in this niche, research venture capital or private equity firms specifically geared toward supporting tech-driven small businesses. 

If you aren’t quite sure about the best options to pick, it’s always advisable to work with accredited analysts and consultants who can direct your investments. 

Investors Should be Aware of the Risks

Although investing in high-growth, disruptive sectors comes with a robust potential for growth and profits, investors should also be aware of the risks. Since the sectors are emerging and many are in their nascent stage, they also carry a higher risk factor. 

That is why it’s always advisable to make investment decisions under the guidance of consultants who understand the industry well. Why?

• Even as the tech sector continues to evolve, new risks emerge, and cybersecurity is just one of them. Lawmakers must keep pace with emerging risks, which is why regulatory compliance is a huge issue. Companies going under because they can’t remain compliant is a major risk.
  
  
• The high growth potential of tech companies also results in cutthroat competition. Maintaining a hold on the market and a market share is challenging for most companies. They must also contend with the possibility of volatility and products becoming redundant quickly. 
  
  
• Because of its nascent nature, the tech sector is unpredictable, raising the risk quotient substantially. Although many concepts seem promising at the onset, their audience acceptance is not guaranteed.
  
  
• Technology being ahead of its time is a real possibility, and often, companies come out with tech that the market is not ready for yet. Finding a market for their products could be extremely challenging. 
  
  
• The most significant factors that can influence the success or failure of a venture are its core team and top management. A tech company must hire the best talent out there who can develop intellectual property. At the same time, it needs experienced executives to ensure the company makes its mark in the industry. Without this balance, success could be elusive. 

The Takeaway!

High-growth tech investments in today’s market are a valuable proposition with the potential to earn rich profits and returns. However, investors should approach these opportunities with caution. This vertical is highly volatile and nascent, needing exceptional expertise. 

You’ll need to work with experienced consultants and financial advisors before sinking your money into ETFs.