Bridging Privacy Tech Gaps & Fueling the Future of Privacy Tech: Investors
Part 6 of a blog series on the TROPT Defining the Privacy Tech Landscape Whitepaper 2021
by Lourdes M. Turrecha & Emily Ashley (@emily-ashley), originally published on The Rise of Privacy Tech website on December 19, 2021.
Last month, we at The Rise of Privacy Tech (TROPT) published the TROPT Defining the Privacy Tech Landscape Whitepaper 2021, the foundational whitepaper on the privacy tech landscape. In our first five posts in this series, we broke down key positions on defining privacy tech, categorizing privacy tech, and bridging privacy tech gaps for buyers and users, founders, and domain experts. In this sixth post, we summarize how we help bridge privacy tech gaps for investors.
Amongst the key players in privacy tech — founders, investors, expert advisors, and buyers — investors are seemingly the least interested in digging into and understanding privacy or privacy tech . Most of the investors we’ve engaged with through TROPT view privacy tech as an insignificant niche falling under cybersecurity, which, as we cover in depth in the whitepaper, is wholly inaccurate.
This not to say that investor interest in funding privacy tech startups hasn’t been growing. Towards the beginning of the pandemic when funding was reportedly stalled, funding towards privacy tech startups continued. Investors reportedly poured in almost six billion US dollars (specifically, $5.9B) in cumulative funding towards emerging privacy companies; four billion ($4B) in the past three years; and one and a half billion ($1.5B) in 2021 alone.
We predict that as more and more privacy tech unicorns emerge and as the current ones prepare for IPO, investors will necessarily follow. We salute the early visionaries who were first to fund privacy tech, at its nascency. And we encourage emerging privacy tech investors to jump in and help fuel privacy tech by funding the next round of privacy tech unicorns.
Our key recommendations for investors center around getting involved in the emerging privacy tech landscape and funding privacy tech solutions, versus privacy-invasive ones:
Investors should understand that there is a clear marketplace demand for privacy, both in the B2B and B2C sides. Failing to do so means missing out on investing in upcoming privacy tech unicorns. It also means failing to step up and address the mounting privacy technical debt created by the tech industry, particularly by technologies that were built without much regard to privacy. This mounting privacy technical debt partly fuels the marketplace need for privacy tech.
Investors should recognize that privacy tech opens up environmental, social, and governance (ESG), social responsibility investments (SRI), and impact investing opportunities. This is game-changing for venture capital. Today’s limited partners (LPs) demand that their money make a positive impact on society and the world at large.
By now, investors should understand that privacy tech is its own emerging industry. Privacy tech is NOT a cybersecurity or other adjacent industry subcategory. We hope that the whitepaper helps illustrate the big picture of this nascent but emerging space.
Put simply: investors should invest in privacy tech. There’s a clear marketplace demand for privacy tech. Investing in startups that solve privacy problems is the right thing to do. Other forwardthinking investors have already poured almost six billion US dollars (specifically, $5.9B) in cumulative funding towards emerging privacy companies, with four billion ($4B) in the past three years alone.
- Excerpts from the TROPT Defining the Privacy Tech Landscape Whitepaper 2021
Join us in fueling privacy tech and innovation
If you want to dig deeper, you can download the full TROPT Defining the Privacy Tech Landscape Whitepaper 2021 here.
If you’d like to join next year’s working group, you can do so by joining TROPT Innovators.
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Lastly, you can join us at our next conference, TROPT Data Privacy Week 2022 by registering here.
