5 Tips You Need to Know Before Entering a Growth Industry — From Someone Who’s Doing It

For the ambitious entrepreneur, there is an ever-growing list of exciting new sector opportunities to explore. Many of these, especially those with billion to trillion-dollar valuations, belong to growth industries, which are defined as sectors of the global economy that experience higher-than-average growth rate. 

From the rise of services and products enhanced by generative AI technologies to the attractive growth projections reported in sectors such as the Internet of Things, cybersecurity, robotics and even space technologies, growth industries have the potential to shape the future we will live in. A McKinsey report on future growth industries said that around 18 sectors are deemed to be transformative, with the potential to reshape the global economy, making revenues worth between $29 trillion and $48 trillion by 2040.

As an entrepreneur and investor who recently entered a high-growth industry himself, the author would like to share five useful tips that entrepreneurs need to know about before they make the bold step forward.

1. Know your industry.  Entrepreneurs entering a growth industry should know the ins and outs of the sector and target regions, from the movement of the regulatory landscape to trends to discussions around ethics and social effects, especially where new technologies are involved.  To help you better understand the prospect of a growth industry, analyze past and present trends across multiple timeframes. See the big picture. Make sure that the highly valued stocks and sky-high valuations are part of a wider trajectory rather than being results of a short-term microtrend.
2. Future-proof your company.  There is always risk involved when entrepreneurs enter a growth industry for the first time, so to prepare for this, you need to build a resilient ship that can withstand any storms in the form of market fluctuations and black swan events.  A few factors are important to do this. You have to create flexible business operations that could adapt and change to changes in the wider landscape.  Entering a growth industry usually requires entrepreneurs to be familiar with new technologies. Invest in continuous learning and upskilling across the board so you can be in a good position to stand out among competitors and continue innovating when trends change in the future.
3. Build the A-team.  The key to success in a highly competitive sector, especially one that is emerging, is finding the right talent for the job. This requires thorough research and analysis, including identifying the type of skillset future competitors within the industry are prioritizing.  This can definitely be a daunting task, as brand presence is required to attract top talent in the first place. This is where it is important for the business to promote its unique business culture on innovative platforms, especially those utilised by younger generations, which require little to no marketing budget.
4. Focus on personalized services.  Growth industries are so tech-focused that sometimes, companies can seem impersonal to their customers. Do not make this mistake. In a world where automation is removing even customer service helplines, building a service-oriented company would help your business stand out from the crowd.
5. It’s a race — keep up with the speed.  One thing you cannot afford to do when entering a growth industry is to rest on your laurels. The speed of innovation in industries like these can be overwhelming, so entrepreneurs need to be prepared to do their homework and keep up to speed with changes, which can sometimes occur daily, in a sector like the video game industry, for example.