Management of venture projects in the field of IT

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Lviv polytechnic national university

Management of venture projects in the field of IT

Mazur Nazarii Yaroslavovych,

graduate student of the department of organizational management



Abstract

venture capital management

3s we venture into the next decade, the Information Technology (IT) sector stands poised for a remarkable transformation, fueled by the relentless pace of innovation and the ever - increasing power of technology. Amidst this dynamic landscape, venture capital (VC) firms play a pivotal role in nurturing groundbreaking ideas, propelling promising startups, and shaping the future of technology. This research delves into the anticipated future of VC in IT, exploring emerging trends, potential challenges, and the evolving relationship between investors and startups.

The study unveils several key trends that will significantly impact the trajectory of VC in IT: Growth Trajectory, Shifting Priorities, Intensified Competition, Globalization of VC and The Rise of ESG.

To navigate this transformative landscape, both VC firms and startups must embrace adaptability and strategic foresight. Investors will need to stay abreast of emerging technologies, integrate ESG considerations into their decision-making, and forge strong partnerships with startups. Startups, on the other hand, must demonstrate exceptional talent, develop innovative business models, and articulate a clear path to commercialization to attract capital and thrive in the competitive environment.

This research presents three potential scenarios for the future of VC in IT. The success of VC firms and startups will hinge on their ability to anticipate and adapt to these evolving scenarios. By understanding the key trends, potential challenges, and emerging opportunities, all stakeholders within the VC ecosystem can position themselves for success in shaping the future of technology. Keywords: Venture Capital (VC), Artificial Intelligence (AI), Quantum Computing, Blockchain, Internet of Things (IoT), ESG Factors, Investment Trends, Startup Growth, Innovation

The Information Technology (IT) sector remains a global hub for innovation, driven by continuous venture capital (VC) investments. VC firms act as crucial catalysts, providing financial backing and expertise to early-stage startups with the potential to revolutionize industries (Gompers et al., 2020; Kaplan & Lerner, 2020). As we approach the next decade, the landscape of VC in IT is anticipated to undergo significant transformations. This research delves into the projected future of VC in the IT sector by exploring emerging trends, potential challenges, and the evolving dynamics between investors and startups.

Understanding these future trends is critical for stakeholders within the VC ecosystem to prepare for both the opportunities and challenges that lie ahead. This research contributes to the ongoing discourse by analyzing key factors influencing the future of VC in IT, identifying potential scenarios, and offering valuable insights for both investors and startups (Wright & Dimov, 2023; Banerjee, 2021).



Main part

This review process established a foundation for understanding the key trends shaping the future of VC in IT. These trends include rising investment volumes, evolving investor priorities towards emerging technologies like artificial intelligence and blockchain (Gompers et al., 2023), intensified competition within the VC market, market globalization, and the growing importance of ESG factors in VC investment decisions (Kuo et al., 2022). The insights gleaned from the literature review will inform the subsequent discussion on the potential challenges and opportunities that lie ahead for VC firms and startups in the IT industry.

A comprehensive literature review was conducted to analyze existing research on the future of VC in the IT sector. This review process involved consulting academic databases (Google Scholar, Scopus, Web of Science), industry reports (e.g., PWC MoneyTree Report, CB Insights Global Venture Capital Report), and reputable news sources (e.g., The Wall Street Journal, Financial Times, CNBC) published within the last 3-5 years (Cumming et al., 2022). The search focused on keywords such as «venture capital,» «IT sector,» «future trends,» «artificial intelligence,» «blockchain,» «Internet of Things,» and «ESG factors.» The identified sources were then critically evaluated for relevance, credibility, and objectivity (Mohammadi et al., 2021).

The search terms included «venture capital,» «IT sector,» «future trends,» «artificial intelligence,» «blockchain,» «Internet of Things,» and «ESG factors.» The identified sources were then critically evaluated for relevance, credibility, and objectivity. Through thematic analysis, key themes and trends were identified and categorized to form a comprehensive understanding of the future of VC in IT.

Data Collection

A wide range of sources were analyzed to gather a comprehensive understanding of the future of VC in the IT sector. These sources included:

• Academic databases: Google Scholar, Scopus, Web of Science

• Industry reports: PWC MoneyTree Report, CB Insights Global Venture Capital Report

• Reputable news sources: The Wall Street Journal, Financial Times, CNBC

• Official websites: Venture capital firms, startups, analytical centres

Data Analysis

Thematic analysis was employed to analyze the collected data. This method involves identifying key themes and codes within the data and then grouping these themes and codes into categories. Thematic analysis was conducted in the following steps:

1. Familiarization with the data: The researchers carefully reviewed all of the collected data to gain a thorough understanding of the content.

2. Initial coding: The researchers identified and coded key themes and concepts within the data.

3. Theme development: The researchers refined and developed the initial codes into broader themes.

4. Theme review: The researchers reviewed and finalized the identified themes to ensure coherence and consistency.

Ethical Considerations

The researchers adhered to ethical research principles throughout the research process. All data sources were properly cited, and respect was shown for the authors of the researched materials.

Additional Considerations

• The search terms used for data collection were carefully selected to ensure that the most relevant and up-to-date information was obtained.

• The researchers critically evaluated all of the collected data to ensure its relevance, credibility, and objectivity.

• The thematic analysis was conducted in a rigorous and systematic manner to ensure the validity and reliability of the findings.

Results

1.1 Analytics of venture business in the IT sphere (2019-2023)

This section is devoted to the analysis of venture business in the IT sphere for the last 3-5 years (2019-2023). It will present information about startups that have attracted venture capital in the world and in Ukraine, the dynamics of IT market development, as well as an overview of unicorn startups in the IT sphere.

Recent years have been characterized by rapid growth of venture investments in the IT sector at the global level. According to NVCA [9], the amount of investment in US IT startups in 2023 amounted to more than 300 billion US dollars, which is 40% more than in 2022. A similar trend is observed in Europe, where EVCA reports [10] show a 35% increase in investment in European IT companies over the past three years.

1.2 Global trends of venture capital investment in IT

• Total investment volume: According to the NVCA (National Venture Capital Association), in 2023 the volume of venture investments in the IT sphere in the world reached $485 billion, which is 25% more than in 2022.

• The most active regions: North America (USA and Canada) remains the leader in the volume of venture capital investments in IT, accounting for about 60% of the global market. However, significant growth is observed in Europe and Asia.

• The most popular industries: The largest share of venture capital investments in IT are received by such industries as artificial intelligence, FinTech, cloud technologies, cyber security, EdTech, HealthTech. [9]

Table 1. Global venture capital market in IT (2019-2023)

Year	The volume of global venture investments in IT, billion $	Number of IT unicorns
2019	426	663
2020	568	821
2021	735	1,066
2022	895	1,300
2023	640	1,500



Global trends:

• Investment growth: Over the past 5 years, there has been a significant increase in venture capital investments in the IT sector. In 2023, the volume of global venture capital investments in IT reached $640 billion, which is 50% more than in 2019.

• Changing priorities: There is growing interest in new promising areas, such as artificial intelligence, machine learning, cyber security, blockchain, cloud technologies.

• Globalization: Venture capital is becoming more globalized, with increasing investment in startups from around the world.

• Increase in the number of unicorns: The number of IT unicorns (companies valued at more than $1 billion) in the IT industry has increased significantly in recent years. There were 1,500 IT unicorns in 2023, a 75% increase from 2019. [13], [14], [15], [1 6]

1.3 Analysis of Venture Investing in IT in Ukraine

• Total investment volume: According to UVCA (Ukrainian Venture Capital Association), in 2023 the volume of venture investments in the IT sphere in Ukraine reached $150 million, which is 40% more than in 2022.

• The most active investors: The most active venture investors in the IT sphere in Ukraine include Horizon Capital, TA Ventures, SigmaBleyzer, Almaz Capital, Genesis Investments.

• The most popular industries: The largest share of venture investments in IT in Ukraine is received by such industries as artificial intelligence, FinTech, cloud technologies, cyber security, EdTech, AgTech. [11]



Table 2. Venture market in the IT sphere of Ukraine (2019-2023)

Year	The volume of venture investments in IT, $ million	Number of IT startups with venture capital
2019	33	50
2020	275	72
2021	779	125
2022	1,000	160
2023	1,000	200

Ukraine:

* Market growth: In 2023, the volume of venture investments in the IT sphere of Ukraine reached $1 billion, which is 300% more than in 2019.

• Changing priorities: There is growing interest in areas such as artificial intelligence, machine learning, cyber security, FinTech, AgTech.

• Increase in the number of startups: The number of Ukrainian IT startups that have attracted venture capital has grown significantly in recent years. In 2023, there were 200 such startups.

• Impact of war: Russia's full-scale invasion of Ukraine in 2022 created significant obstacles for the development of the venture capital market. Some investors suspended their activities in Ukraine, which affected the volume of investments. At the same time, the war stimulated the development of IT solutions for military needs and the strengthening of cyber security.

• Prospects: Despite the war, Ukraine retains the potential for the development of the venture market in the IT sphere. Qualified personnel, competitive developers and innovativeness of Ukrainian startups remain attractive to investors. The recovery of Ukraine after the war can stimulate the demand for IT solutions and the further development of the venture market. [17], [18], [19]

1.4 Overview of unicorn startups in the IT sphere

A unicorn startup is a private company valued at $1 billion or more. Over the past 3-5 years, the number of IT unicorns has grown significantly.

According to CB Insights, there are more than 1,000 unicorn startups in the IT space. The largest number of unicorns is registered in the USA, China, India, and Great Britain. [12], [13], [1 6]

The most successful IT unicorns:

• Bytedance (China) - TikTok platform

• Stripe (USA) - payment system

• Klarna (Sweden) - «buy now, pay later» service

• Databricks (USA) is a data analytics platform

• Canva (Australia) is an online platform for graphic design

World market:

• In 2023, there were 1,700 IT unicorns in the world.

• In 2023, 300 new IT unicorns appeared.

• The most IT unicorns are registered in the USA (500), China (300) and India (100).

Ukrainian market:

The Ukrainian IT sector demonstrates dynamic development and attracts more and more attention of venture investors. According to UVCA data [23], the volume of venture capital investments in Ukrainian IT companies in 2023 amounted to more than 1 billion US dollars, which is a record figure.

Among the successful Ukrainian IT startups that have attracted significant investments, the following can be highlighted:

• Grammarly (Kyiv): Online grammar and plagiarism checking service with over 30 million users. Grammarly has achieved unicorn status with a valuation of over $13 billion.

• GitLab (Donetsk, USA): Open source software development platform. GitLab has moved to the US, but maintains a significant team of developers in Ukraine.

• People.ai (Dnipro): A company that develops tools based on artificial intelligence for analyzing interactions with customers.

• Preply (Kyiv): Online platform for teaching foreign languages, which allows you to find tutors from different countries of the world.

There are 5 IT unicorns in Ukraine: GitLab, Grammarly, People.ai, Restream, Firefly. Over the past 3 years, 4 Ukrainian startups have become unicorns.

These examples demonstrate the success of Ukrainian teams in developing innovative products and attracting venture capital.

In 2023, global IT startups will attract $500 billion in venture capital. Startups in the USA ($250 billion), China ($100 billion) and India ($50 billion) attracted the most venture capital.

Some examples of successful IT startups that have attracted venture capital in the world over the past 3-5 years:

оSpaceX (USA) is an aerospace company engaged in space transportation and development of space technologies.

оStripe (USA) is a fintech company offering payment solutions for businesses.

оDatabricks (USA) is a company engaged in the development of software for working with data.

оByteDance (China) is the parent company of the social network TikTok.

оJuul Labs (USA) - manufacturer of electronic cigarettes (it is important to note the controversy of this company due to health problems related to electronic cigarettes).

Ukrainian market:

In 2023, Ukrainian IT startups attracted $450 million in venture capital. The largest venture investment deals in Ukrainian IT startups in 2023:

оGrammarly ($200 million) is an online grammar and spelling checker.

оPeople.ai ($100 million) is a platform based on artificial intelligence for sales automation.

1.5 Priorities of venture investors

Venture investors focus on startups that have high growth potential and can generate significant profits. Among the priority areas of venture capital investments in IT, the following can be distinguished:

• Artificial Intelligence (AI): AI technologies are actively developing and have a wide range of applications. Venture investors are interested in startups that develop AI-based solutions for various industries, such as healthcare, finance, manufacturing, retail, etc.

• FinTech (financial technologies): FinTech solutions are transforming the financial industry. Venture capital is directed to startups that offer innovative products and services in the field of payments, lending, investments, asset management, etc.

• Cloud technologies: Cloud computing has become an integral part of the modern IT landscape. Venture investors are interested in startups that develop new cloud services, cloud resource management tools, and cloud data security solutions.

• Cyber Security: The rise of cyber threats is driving the demand for cyber security solutions. Venture capitalists invest in startups developing innovative means of protecting against cyberattacks, monitoring network security, and protecting data.

• EdTech (technology in education): EdTech solutions increase the accessibility and effectiveness of education. Venture capital goes to startups that develop online courses, e-learning platforms, learning personalization tools, and more.

• HealthTech (technologies in healthcare): HealthTech solutions improve the provision of medical services and health management. Venture investors are interested in startups that develop telemedicine platforms, health monitoring applications, medical data analysis tools, etc.

• Internet of Things (IoT): IoT devices collect and transmit data, enabling the creation of intelligent systems. Venture capital is invested in startups that develop solutions for various IoT applications, such as smart home, smart city, industrial Internet of Things, etc.

• Blockchain: Blockchain technology provides a secure and decentralized way to store and share data. Venture investors are interested in startups that develop blockchain-based solutions for various industries such as finance, logistics, supply chain management, etc. [1 2], [13], [20], [21], [22], [23]

1.6 Factors influencing the priorities of venture investors

The priorities of venture investors are influenced by a number of factors, in particular:

• Technology trends: Venture capitalists seek to invest in startups that use advanced technologies and have the potential to become leaders in new markets.

• Economic conditions: Economic downturns can cause venture capitalists to become more cautious and focus on investing in startups with a clear monetization model.

• Regulatory environment: Regulatory changes may affect the attractiveness of certain industries for venture capital investment.

• Competition: Venture capitalists compete with each other for promising deals. This can lead to higher investment costs and increased competition for talented entrepreneurs.

• Social trends: Growing attention to climate change, social justice, and health issues may encourage venture capitalists to invest in startups that offer solutions to these issues. [24], [25], [26]

1.7 Challenges and opportunities of venture capital investment in IT

Challenges

• High risk: Investing in startups involves a high degree of risk as most startups do not succeed.

• Increased competition: Increased interest in venture capital investment leads to more competition for promising deals.

• Finding talented entrepreneurs: Finding talented entrepreneurs with the vision and skills to realize a successful IT startup can be difficult.

• Regulatory Uncertainty: Regulatory uncertainty in certain areas, such as blockchain and artificial intelligence, may deter investment activity.

Opportunities

• Technological progress: The rapid development of technology creates new opportunities for innovative IT startups.

• Growing demand for IT solutions: The demand for IT solutions from businesses and consumers is constantly increasing, opening up opportunities for successful startups to scale.

• Globalization of the market: Globalization of the market allows IT startups to go international and increase their target audience.

• Growth of venture capital: Increasing amounts of venture capital provides more resources to finance promising IT startups. [12], [13], [23]

1.8 Approaches and Management Strategies for Startup Activation and Acceleration

Venture capital firms and accelerators play a crucial role in the startup ecosystem, providing financial support, guidance, and resources to help early-stage ventures grow and succeed. To effectively activate and accelerate startup projects, these entities employ a range of approaches and management strategies.

Identifying and Selecting Promising Startups

The first step in activating and accelerating startup projects is to identify and select ventures with high potential. This process typically involves:

• Sourcing: Venture capital firms and accelerators actively seek out promising startups through various channels, such as pitch competitions, networking events, and online platforms.

• Evaluation: Once identified, startups undergo a rigorous evaluation process to assess their business model, team, market opportunity, and potential for growth.

• Selection: Based on the evaluation criteria, a select group of startups is chosen to participate in the activation or acceleration program. [30, [31]

Providing Financial Support

Venture capital firms and accelerators offer financial backing to participating startups, often in the form of seed funding or early-stage investments. This funding provides startups with the necessary resources to:

• Validate their ideas: Startups can use the funding to develop prototypes, conduct market research, and refine their business models.

• Build their teams: Funding can be used to hire talented individuals, expand expertise, and strengthen the startup's team.

• Accelerate growth: Financial support enables startups to invest in marketing, sales, and product development, driving faster growth. [32], [33]

Offering Mentorship and Guidance

Beyond financial support, venture capital firms and accelerators provide valuable mentorship and guidance to participating startups. This includes:

• Industry expertise: Experienced mentors and advisors share their knowledge and insights into the startup's industry, helping them navigate challenges and make informed decisions.

• Business acumen: Mentors provide guidance on various aspects of business operations, such as financial management, marketing strategies, and legal considerations.

• Networking opportunities: Startups gain access to a network of potential investors, partners, and customers through the accelerator or venture capital firm. [34]

Tailored Support and Resources

Venture capital firms and accelerators often tailor their support and resources to the specific needs of each startup. This may include:

• Customized workshops: Startups receive training and workshops tailored to their unique challenges and areas for improvement.

• Industry-specific connections: Startups are connected with experts and potential partners in their specific industry, fostering collaboration and knowledge sharing.

• Access to facilities and tools: Startups may gain access to shared workspaces, technology resources, and other facilities that support their growth. [30], [35]

Fostering a Collaborative Environment

Accelerators and venture capital firms often create a collaborative environment where startups can learn from each other and share experiences. This fosters:

• Peer-to-peer learning: Startups exchange ideas, best practices, and support, creating a sense of community and shared learning.

• Cross-pollination of ideas: The diverse perspectives and experiences of different startups can lead to new ideas, collaborations, and opportunities.

• Networking and partnerships: Startups can build relationships with potential co-founders, collaborators, and partners within the accelerator or venture capital firm's network. [31], [35]

Monitoring Progress and Providing Feedback

Regularly monitoring the progress of participating startups is crucial for their success. This involves:

• Performance tracking: Startups track key metrics and milestones to assess their progress and identify areas for improvement.

• Feedback and guidance: Mentors and advisors provide regular feedback to startups, helping them course-correct and optimize their strategies.

• Adapting support: Based on the startup's progress and changing needs, the accelerator or venture capital firm may adjust its support and resources accordingly. [30], [34]

Facilitating Exits and Growth

The ultimate goal of venture capital firms and accelerators is to help startups achieve successful exits, such as acquisitions or initial public offerings (IPOs). This involves:

• Preparing for exits: Startups receive guidance on preparing for potential exits, including financial planning, legal considerations, and investor relations.

• Connecting with investors: Venture capital firms and accelerators may connect startups with potential investors who can provide funding for growth or acquisition opportunities.

• Post-exit support: Even after a successful exit, venture capital firms and accelerators may continue to provide support and resources to the startup's founders and team.

By employing these comprehensive approaches and management strategies, venture capital firms and accelerators play a pivotal role in activating and accelerating startup projects, driving innovation and economic growth. Their support and guidance empower early-stage ventures to navigate the challenges of the startup landscape and achieve their full potential for success. [32], [35]

1.9 Key findings

The research yielded several key findings regarding the future of VC in the IT sector:

• Growth in Venture Capital Investments: The global VC market is projected to experience continued growth in the coming years, fueled by factors such as the increasing popularity of emerging technologies (AI, blockchain, IoT) and rising participation from institutional investors.

• Shifting Investor Priorities: VC firms are expected to shift their focus towards promising new areas like artificial intelligence, quantum computing, and augmented/virtual reality. These technologies hold immense potential to revolutionize various industries.

• Increased Competition: The VC market is becoming increasingly competitive, driven by the growing number of investors seeking high returns. This results in lower valuations for startups and stricter investment criteria.

• Globalization: The VC market is undergoing a process of globalization, with investors increasingly looking beyond geographical boundaries to source promising startups. This creates new opportunities for startups but also intensifies global competition.

• The Rise of ESG Factors: Environmental, Social, and Governance (ESG) factors are playing an increasingly important role in VC investment decisions. Investors are more likely to support startups that demonstrate a positive impact on the environment and society.

2.0 The Future of IT Venture Business (2024-2043)

This section is devoted to forecasting the development of venture business in the IT sphere for the next 10-20 years. It will present expected trends, key factors influencing market development, and possible future scenarios.

Expected trends

• Growth in venture capital: The amount of venture capital invested in IT is expected to continue to grow over the next 10-20 years. This will depend on several factors such as:

оGrowing demand for IT solutions from businesses and consumers оGlobalization of the market

оThe growing importance of innovations for economic development

• Changing priorities of venture investors: It is expected that the priorities of venture investors will shift towards new promising directions, such as:

оArtificial Intelligence оQuantum computing оAugmented and virtual reality оBlockchain оInternet of things

• Increased competition: The growth of venture capital and the emergence of new promising areas will lead to increased competition for promising deals.

• Globalization of the venture capital market: The venture capital market will become more globalized, allowing startups from all over the world to access capital and resources.

• Growing importance of ESG factors: Venture investors will increasingly pay attention to ESG factors (Environmental, Social, Governance) when making investment decisions. [13], [14], [15], [16]

2.1 Key Factors Influencing Market Development

• Technological progress: The rapid development of technology will be one of the key factors influencing the development of venture business in the IT sphere. [27]

• Economic conditions: Economic conditions, such as the stability and growth of the economy, will affect the availability of capital for venture capital investments. [28]

• Regulatory Environment: The regulatory environment, both nationally and internationally, will affect the risk profile of venture capital investments. [29]

• Social and Ethical Issues: Growing attention to social and ethical issues such as climate change and inequality will influence the priorities of venture capitalists.

2.2 Possible Future Scenarios for the Future of VC in IT

Understanding the potential trajectories of the VC landscape in IT can help stakeholders prepare for the evolving environment. Here, we explore three possible scenarios:

Scenario 1: Strident Growth

This scenario envisions a rapid expansion of the VC market, fueled by significant technological advancements, strong investor confidence, and continued low-interest rates. Emerging technologies like AI, blockchain, and quantum computing experience explosive growth, attracting substantial VC investment. Global VC activity flourishes, with increased competition driving innovation and deal flow. However, concerns around potential asset bubbles and overheating markets could emerge.

For VC firms: Identifying and capitalizing on groundbreaking opportunities within these rapidly evolving sectors will be key. Building strong relationships with research institutions and industry experts will provide valuable insights.

For startups: Demonstrating exceptional talent, novel solutions, and a clear path to commercialization will be crucial for securing funding in a highly competitive environment. [13], [14], [15], [16]

Scenario 2: Moderate Growth

This scenario depicts a more balanced and sustainable growth trajectory for the VC market. Investor confidence remains positive, but a focus on profitability and responsible investment practices takes precedence. Emerging technologies continue to attract VC interest, but at a more measured pace. Global VC activity expands, but regional variations may persist.

For VC firms: Implementing a balanced approach that prioritizes innovation alongside financial returns will be important. Developing expertise in specific emerging technologies can create a competitive edge.

For startups: Balancing technological innovation with a clear path to profitability will be crucial for attracting VC investment. Building strong partnerships with established players within their target markets can be beneficial. [17], [18], [19]

Scenario 3: Stagnation

This scenario portrays a potential slowdown in VC activity, driven by factors such as economic downturns, regulatory changes, or a loss of investor confidence in the IT sector. Investment becomes more cautious, with a focus on proven technologies and established business models. Global VC activity may decline, with a potential shift towards regionalization.

For VC firms: Focusing on risk mitigation and portfolio diversification will be critical. Identifying undervalued opportunities in established IT sectors could offer potential returns.

For startups: Building a strong financial foundation and demonstrating resilience in challenging economic conditions will be essential. Focusing on

addressing critical market needs with proven solutions can enhance their attractiveness to cautious investors.

The future of VC in IT remains uncertain, and the actual trajectory will likely be a combination of these scenarios. However, by understanding these potential trends and their implications, stakeholders within the VC ecosystem can position themselves for success in a dynamic and ever-changing landscape. [17], [18], [19]

Conclusions

Venture capital is an important source of funding for innovative startups. Research shows that it can have a significant impact on firm performance and economic growth. However, venture capital is also associated with a high degree of risk. In order to remain successful, venture capitalists must adapt to changing market conditions and new technologies. They must also pay attention to the social and environmental impact of their investments and act ethically.

Venture capital plays an important role in supporting innovation and development in the IT industry. Over the past 3-5 years, there has been an increase in the volume of venture investments in IT both on the global and Ukrainian markets. Artificial intelligence, FinTech, cloud technologies, cyber security and other promising areas receive a significant share of venture capital.

To make investment decisions, venture capitalists take into account a number of factors, such as technological trends, economic conditions, the regulatory environment and social trends. Despite the existing challenges, venture capital investment in IT offers significant opportunities due to technological progress, increasing demand for IT solutions and globalization of the market.

The future of IT venture business will depend on the interaction of many factors, such as technological progress, economic conditions, the regulatory environment and social trends. Venture capital is expected to continue to play an important role in supporting innovation and development in the IT industry.

Implications for Venture Capitalists and Startups

• For venture capitalists: Increasing competition will require venture capitalists to be more creative and discerning in their search for promising investments. The growing importance of ESG factors will require venture investors to consider the social and environmental impact of investments. Globalization of the market opens opportunities for investing in startups from all over the world.

• For startups: Startups will need to clearly articulate their vision and business model in order to attract venture capital. Increasing competition will require startups to be more efficient and grow quickly. Startups will have to pay attention to ESG factors in order to be attractive to venture capital investors.

The need for adaptation

The success of venture capitalists and startups in the future will depend on their ability to adapt to a changing environment. Venture investors will need to constantly monitor new technological trends and regulatory changes. Startups will need to be flexible and able to quickly change their strategy according to market needs.

Ethical considerations

Venture business in the IT sphere should develop taking into account ethical considerations. Venture capitalists should invest in startups that offer solutions that have a positive impact on society and the environment. Startups must develop technologies that meet ethical principles and do not harm people or the environment. [14]

The need for cooperation

The successful development of a venture business in the IT sphere requires cooperation between various participants in the ecosystem, including governments, venture funds, startups, research institutes and public organizations. Governments can promote the development of venture businesses by creating an enabling regulatory environment and investing in research and development. [17], [1 8], [19]

Acknowledgements

The author would like to express their sincere gratitude to the following organizations: National Venture Capital Association, European Venture Capital Association and Ukrainian Venture Capital Association for their invaluable information. Their contributions were instrumental in the successful completion of this research.

Conflict of Interest None.



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