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Startups

'Work' and 'life' to follow 'mobility' as next venture cash magnets

JCER report gauges startup trends and regional economic prospects

Startups that change the way we get around have attracted billions of dollars, but the focus of investment is starting to shift.   © AP

TOKYO -- Startups that change the way we get around have attracted billions of dollars in recent years, but venture investment is destined to shift from "mobility" to companies that revolutionize workplaces and lifestyles, according to a new study from the Japan Center for Economic Research released on Thursday.

Economists picked 190 global startups that have received investment from at least four out of 35 influential venture capital players, such as Sequoia Capital. They then divided these startups by size: 75 unicorns, or unlisted companies with estimated valuations of at least $1 billion, and 115 unicorn candidates that are likely to garner more attention in the near future.

To identify trends, the companies were then categorized according to their roles in urban societies, including mobility, work and life. In the picture that emerges, VCs' current interest in mobility startups will shift to work- and life-oriented ventures.

Right now, after U.S. mobility companies Uber Technologies and Lyft went public, Asian players in this field are attracting attention. Such companies are increasingly bringing ride-hailing, micro mobility, food delivery and payment services under one roof.

Work-related investment targets will include companies that enhance the efficiency of offices and factories, with specialties ranging from business software and 3D printing to ultrafast quantum computing and edge computing, which processes data close to the source.

The life startups, meanwhile, offer new ideas for health care, entertainment and education.

The report covers the period from 2019 to 2035 and is titled "Digital Asia under U.S.-China confrontation: the future of innovation and city economies." It endeavors to gauge the impact of both the trade war as well as accelerating urbanization. Overall, it envisions a digital economy divided between the two superpowers, with other players such as India and Southeast Asian countries maintaining links to both sides.

Besides venture investment, the report also looks at the future of city and national economies across the Asia-Pacific region. In 2035, San Francisco will be the only city with per capita gross regional product exceeding $200,000. All of the top 10 cities in this category will be American, with Singapore continuing to lead the way in Asia.

At the national level, the U.S. will remain the world leader in nominal GDP. But China will not only strengthen its grip on second place but close the gap with the top spot.

Though China's economic scale was about 65% of the U.S. in 2018, it will be 95% in 2035 -- almost on par and 4.5 times larger than Japan.

India's GDP, which is currently about half of Japan's, is expected to move ahead of Japan in 2029 and reach 1.4 times in 2035. The Philippines will overtake Malaysia's GDP in 2020, Taiwan's in 2033 and Thailand's in 2034. The Philippines is expected to become the second-largest ASEAN country after Indonesia in terms of economic size.

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