Companies in the sector are on pace to raise at least $500 million in 2020
Startup buzz comes in waves, with a particular thesis or focus coming into vogue at certain times. Remember the short-lived boom in chat bots? That was good fun. And there was the ICO craze, which lead every startup you’ve heard of to consider the financing option for at least a weekend.
We’ve also endured the early-AI bubble, the blockchain rush and a cannabis-driven wave as well. Even subtheses can see spikes, such as the neobanking industry, say, or roboadvising. Hell, we saw minicrazes in insurtech marketplaces and OKR software this year alone.
Fads in startups are not new. Today, as venture investment tilts toward enterprise software, we’re in something of a SaaS craze. Inside of today’s SaaS surge, however, is a smaller trend that I want to explore more: no-code and low-code startups.
Largely, low-code and no-code refer to tools that allow nondevelopers to either employ little (low-code) to no code while either building logic inside of software, or full applications. Low/no-code development often features drag-and-drop interfaces (Techopedia, TechTarget), but not all low-code and no-code tools are used to build apps.
Defining the sector and its focus is difficult. PitchBook says low/no-code development platforms “expedite the creation of new applications with minimal coding requirements and offer tools for nonprogrammers.” A recent TechCrunch article by a couple of venture capitalists argued that low/no-code work is “not a category itself, but rather a shift in how users interface with software tools.”
A bit like how AI and fintech are squishy categories, low-code and no-code have a wide remit.
After talking to a number of entrepreneurs lately who built these capabilities into their startups’ applications, it appears that today founders expect the capabilities to more helpful for nondevelopers reordering logic inside apps for their own needs, instead of building whole-cloth applications.