The venture capital industry has been in turmoil for the past couple of years, having an adverse effect on newly launched startups as they enter into the funding years. Notably, we forecast an overall positive outlook for the venture capital (VC) industry as the funding has been southward bound in the country, domestic angel investors have played a crucial role at this juncture by coming forward and acting as drivers for the growing startup funding ecosystem.
During 2023, the country’s top 10 angel investors have induced funding into the startup ecosystem and have made as many as 101 investments in Indian Startups, according to data by Venture Intelligence. This number is significantly lower than last year’s 207 investments made by Indian angel investors.
In the early week of Oct’2023, investors and entrepreneurs splurged the startup ecosystem by launching their own investment funds. Below, we have provided a detailed description of these highlighted funds, shedding light on their unique attributes and investment strategies.
VSS Investment Funds
Launched by Vijay Shekar Sharma (Founder & CEO, Paytm)
Total Fund Size: Rs. 30Cr.
Industry Overview: Artificial Intelligence (AI) and Electric Vehicle (EV)- related startups, incubated in India.
WTF Funds
Launched by Nikhil Kamath (Founder & CEO, Zerodha)
Total Fund Size: Rs. 80L
Industry Overview: An initiative to invest in startups launched by budding entrepreneurs under the age of 22 years.
Additionally, Industry pioneers and investors such as Rohit Bansal (Co-founder, Snapdeal) and Nithin Kamath (Founder & CEO, Zerodha) also have a future outlook to infuse their investments into the startup ecosystem through the investment entities owned by them.
Source: Venture Intelligence
Zerodha-owned investment arm Rainmatter Capital has allocated a fresh capital of Rs 1,000 crore in a unique structure that has no exit mandates to investors in order to benefit founders. Set up in 2016, Rainmatter has partnered with over 80 startups and has invested close to Rs 400 crore, the investments focus on sectors like health, education, and climate change.
Whereas, Titan Capital (Rohit Bansal’s Investment Arm) screens more than 4,000 inbound proposals from investors every year, making Bansal one of the most active angel investors in the Indian Startup World. Considering the bets taken by him through his investment firm, Bansal has invested in 17 startups, with his portfolio companies including Ola, Pepper, Urban Company, Mamaearth, and Credgenics.
In conclusion, India’s Startup story for the foreseeable future looks promising, we believe that rising funding opportunities from domestic angel investors and VC firms and the country’s growing young entrepreneurial generation will lead India’s economy to compete with the world’s strongest economies.
The manufacturing industry has undergone tremendous changes over the past few decades with each new industrial revolution. We are now in the midst of Industry 4.0 – the fourth industrial revolution – which is bringing about a new wave of advancements with cutting-edge technologies like artificial intelligence, cloud computing, advanced robotics, 3D printing & more.
As a global management consulting firm, we have been closely tracking developments in the Industry 4.0 space through research and client engagements. Our findings indicate that Industry 4.0 will transform business operations across various sectors by driving productivity, efficiency, flexibility and sustainability.
The interconnected and data-driven nature of Industry 4.0 solutions is helping businesses gain real-time insights, optimize processes, boost output and reduce costs significantly.
Market Trajectory
Our market analysis reports indicate the global Industry 4.0 market size was valued at USD 100.32 billion in 2021. It is expected to witness tremendous growth and reach USD 352.27 billion by 2029, expanding at an impressive 16.6% CAGR during the forecast period.
This underscores the massive potential and widespread adoption of advanced manufacturing technologies worldwide. All major industrialized regions like North America, Europe, Asia-Pacific and Latin America are increasingly investing in Industry 4.0 upgrades.
The Internet of Things (IoT), cloud computing, analytics, artificial intelligence (AI) and machine learning are driving forces behind Industry 4.0– which is revolutionising the ways in which organisations manufacture, improve and disseminate their commodities.
Major forces driving the manufacturing sector forward include the rapid adoption of artificial intelligence and the internet of things by manufacturers, rising consumer interest in medicines and medical products made by robots, increased use of 3D printing and additive manufacturing and increasing government support for these technologies.
Key Enabling Technologies
Some of the key Industry 4.0 technologies gaining traction include industrial automation solutions, industrial internet of things (IIoT), industrial 3D printing, robotics, artificial intelligence, machine learning, digital twin, additive manufacturing and more.
The integration of these technologies is helping organizations drive higher productivity, better quality, reduced downtime and data-driven decision making. For instance–IoT connectivity allows real-time equipment monitoring and predictive maintenance.
Use of robotics and automation improves production throughput. Implementation of digital twins aids in virtual prototyping and simulation of processes.
Strategic and Operational Benefits
Beyond operational efficiencies, Industry 4.0 also brings strategic advantages such as launching new customized products and services faster.
The data generated can be leveraged for new revenue streams through analytics services. The flexibility of Industry 4.0 plants allows on-demand manufacturing and mass customization leading to an enhanced customer experience. Environmental benefits include reduced energy consumption and optimized resource usage.
Recommendations
While Industry 4.0 transformations do pose initial challenges, the long-term advantages far outweigh these. Early adopters will gain competitive differentiation and market position.
Those who delay integration also risk losing out to more agile competitors. We recommend leveraging Industry 4.0 technologies to optimize operations, unlock new revenue streams and future-proof organizations for tomorrow’s demands. A proactive strategy can help stay ahead of the curve in this dynamic environment.
As startup funding landscapes evolve rapidly, it is imperative that entrepreneurs and investors alike maintain a sophisticated grasp of the contractual agreements and economic trade-offs underpinning various financing options. SAFEs pose as viable option for budding entrepreneurs to not lose on equity right from the start.
Our objective here is to analyze Simple Agreements for Future Equity (SAFEs) and priced equity rounds, two alternative instruments that have grown in popularity yet remain not fully understood by many. The aim is to foster well-informed decision making that appropriately balances risk, reward and long-term strategic objectives.
SAFEs: A Streamlined Early Option
SAFEs (Simple Agreements for Future Equity) provide an appealing option for early-stage companies seeking to raise small amounts quickly with minimal legal overhead. However, their flexibility comes at the cost of greater dilution for founders down the road. The objective is to exhibit how SAFE provisions could be utilized by start-ups and how their contingent equity conversion can significantly dilute founders compared to priced equity rounds.
SAFEs offer a streamlined mechanism for startups to raise small seed amounts quickly with minimal legal fees. Investors provide funds in exchange for a future equity stake contingent on a later equity financing. This flexibility enables fast access to capital during early stages.
However, SAFEs’ contingent conversion comes at the cost of greater dilution risk. The longer a company waits for a subsequent priced round, the larger the stake investors will receive relative to founders. Additionally, without established share prices, it can be difficult to determine fair valuation in future financings.
It is imperative to remember that even though SAFEs provide less amounts for legal fees upfront, their contingent equity conversion means founders face greater dilution risk the longer a company waits to do a priced equity round.
Priced Rounds: Less Dilutive but More Complex
Alternatively, priced equity rounds establish share prices upfront and give investors preferred stock, limiting dilution risk for founders. However, negotiated preferred stock terms like liquidation preferences introduce new complexities that must be carefully considered.
While preferred stock terms like liquidation preferences safeguard investors to an appropriate degree, excessive preferences could hinder a startup’s strategic flexibility down the road. High preferences may make it difficult to pursue an acquisition or raise additional capital if facing challenges.
Additionally, preferred negotiations introduce complex contractual issues requiring experienced counsel. Improperly structured terms could undermine either party’s interests. Early-stage companies in particular must weigh these challenges against priced rounds’ dilution certainty.
One key consideration with priced rounds highlighted is the role of liquidation preferences. A higher liquidation preference protects investors but could make it more difficult for a company to be acquired or get subsequent investors if facing financial difficulties. Founders must weigh these trade-offs based on their specific strategic goals and risk tolerance.
Strategic Considerations
Ultimately, the optimal instrument depends on a startup’s unique circumstances and risk profile at different growth phases. SAFEs serve as a flexible bridge for seed-stage ventures, while priced rounds better support scale-ups needing long-term strategic clarity.
Founders must understand trade-offs to determine the best structure aligning with their vision. Investors too must evaluate provisions within the context of a company’s goals. With open communication and sophisticated analysis of options, parties can craft financing solutions meeting mutual objectives.
Overall, both SAFEs and priced equity rounds play an important role in funding ecosystem. For very early-stage companies, SAFEs provide a low-friction way to raise seed capital. But as startups mature, the added certainty of a priced round often better suits their needs – if founders can successfully negotiate preferred stock terms to an appropriate level of protection for all parties. The optimal choice depends greatly on individual company circumstances.
Conclusion
As alternative tools proliferate, maintaining a nuanced grasp of modern instruments grows increasingly important. Our article aimed to cut through complexity and illuminate core economic considerations of SAFEs versus priced equity. With well-informed decisions based on comprehensive comparisons, startups and backers can jointly design optimal capital solutions.
By understanding these modern instruments and their economic trade-offs, founders and backers can make financing decisions aligned with long term strategic goals. Our role is to provide the sophisticated analysis that empowers success. Overall, one size does not fit all – the optimal choice depends on each company’s unique circumstances and risk appetite at different stages.
As climate pressures mount, energy storage innovation is increasingly imperative. By pioneering the world’s first sand battery at utility scale, Finland is demonstrating the viability of sustainable alternatives to traditional lithium designs. With further refinement, this breakthrough technology may come to underpin global energy transition efforts in the coming decades.
As nations accelerate renewable energy adoption to curb climate change, energy storage will be critical to power stability as intermittent solar and wind power comes online. However, lithium supplies present a looming bottleneck, with demand for the metal projected to outstrip supply within the decade. Seeking a long-term solution, Finnish startup Nitroerg developed an innovative silicon-carbon composite anode that can be manufactured from abundant sand.
In partnership with Finnish grid operator Fingrid, a 1MW/1MWh sand battery prototype has now been installed and is undergoing commissioning. The project aims to demonstrate the technology’s commercial and technical viability at a utility scale. Initial testing shows the sand-based design can charge and discharge rapidly while retaining 80% capacity even after 4,000 cycles, on par with lithium-ion batteries.
Cost Advantages of Sand Batteries
From a cost perspective, sand-based batteries offer several advantages over lithium-ion alternatives. Silicon extraction and processing is far cheaper than mining scarce metals like lithium, cobalt and nickel. Using locally sourced sand also eliminates international supply chain risks and logistics costs. Based on the technology’s performance thus far, total lifetime costs per kWh of storage could undercut lithium-ion within 5-7 years at scale according to Nitroerg’s projections.
The battery, a 7-meter-tall by 4-meter-wide steel silo filled with 100 tonnes of sand, was erected in the Finnish town of Kankaanpää in June 2022. It is linked to the town’s central heating system, which warms the city’s public buildings and water supply.
Investment Opportunities in Emerging Technology
For investors, successful commercialization could unlock substantial value in battery material and technology companies. Nitroerg’s market cap stands to increase 10-20x if the sand battery proves viable for grid and transportation applications. Partners along the supply chain from silicon refinement to battery production would also benefit.
According to the International Energy Agency, heat consumption accounts for 50% of global energy use, followed by transportation (30%) and electricity (20%). (IEA). Eighty percent of the energy used today originates from polluting fossil fuels.
Beyond ensuring energy security, the sand battery holds promise as a more sustainable and ethically sourced alternative. Silicon extraction produces negligible carbon emissions versus lithium mining and refining which are energy intensive. Further, the use of local sand eliminates geopolitical risks around materials sourced from unstable regions.
Scaling Challenges Ahead
Looking ahead, a successful pilot could see wider adoption across Nordic nations and the EU as these regions aggressively electrify transport and heating. With silicon the second most abundant element in earth’s crust after oxygen, the global market potential is vast. However, scaling production and lowering costs will be critical to compete with entrenched lithium-ion manufacturers.
However, scaling production from the 1MW pilot poses challenges. Significant R&D is still needed to further drive down costs before competing head-on with entrenched lithium producers. Additional testing is also required to validate the battery’s longevity and safety under intensive grid-scale cycling.
If these hurdles can be overcome, the potential market is vast. The EU’s Green Deal alone may generate $100 billion/year in energy storage demand this decade. Even a modest 5% share captured by sand batteries would generate $5 billion annually – transformative for Nitroerg and partners.
Overall, Finland’s initiative represents a promising sustainable and economically viable path for the future grid. Successful commercialization could reap billions in value and cement the country’s leadership in energy transition technologies.
As climate change and social inequities intensify worldwide, there is a growing recognition that the global economy needs to transition towards greater environmental and social sustainability. While public funds alone are insufficient, sustainable finance (SF) offers a means to mobilize vast private capital towards financing this transition. By systematically integrating environmental, social and governance (ESG) factors into investment decisions, sustainable finance aims to align economic activity with long-term sustainability imperatives.
Our aim is to showcase the growing role of SF in catalyzing the shift towards a greener, more equitable and inclusive economic model. It explores the key drivers and opportunities presented by this emerging paradigm. The report also outlines policy and regulatory developments supporting its mainstreaming. Overall, the adoption of sustainable finance approaches presents strategic opportunities for businesses and investors seeking to future-proof operations amidst rising sustainability challenges.
Historically, normal business activity has concentrated on for-profit enterprises striving to maximise profit at the expense of society and the environment. For instance- just 9% of all plastics produced are actually reused or recycled.
It’s true that everyone on Earth depends on the production, distribution and exchange of goods and services, as well as the enforcement of contracts, to survive and prosper. Increased ESG reporting rules will be implemented by the SEC in the near future.
What is Sustainable Finance?
SF refers to the process of taking environmental, social and governance (ESG) criteria into consideration in investment decisions and practices. It involves channeling capital towards businesses and projects that have positive sustainability outcomes.
The core principle of SF is to link financial returns with positive impacts. It seeks to identify and manage material ESG risks and opportunities in order to enhance long-term investment returns and outcomes for both investors and society. Sustainable finance promotes transparency around ESG performance and impacts.
There are 575 investors controlling $54 trillion who are part of the Climate Action 100 project. The 167 corporations in these investors’ portfolios are responsible for 80 percent of industrial climate emissions worldwide.
Rationale for Sustainable Finance
The business case for sustainable finance is strengthened by several factors:
Risk Management: ESG issues like climate change pose risks to operations, supply chains and markets that traditional approaches fail to capture. Sustainable finance helps identify and address these emerging risks to safeguard long-term returns.
New Markets: The transition to renewable energy, green infrastructure, sustainable products and supply chain solutions is creating sizable new markets. Sustainable finance allows tapping the growth potential of these future-oriented sectors.
Competitive Advantage: Adopting sustainable practices helps attract investment, talent and gain an edge over peers, especially as policy and stakeholder expectations evolve rapidly on ESG performance.
Policy Support: With the EU, UK and others introducing regulations on ESG disclosures, taxonomy and green asset labeling, sustainable finance is gaining mainstream traction backed by policy tailwinds.
Future Proofing: By focusing on long-term ESG factors rather than short-term gains, sustainable investments are better equipped to generate durable returns in a resource-constrained world facing climate change and social instability.
Mobilizing Capital at Scale
While public funds are limited, sustainable finance can mobilize the vast pools of private global capital towards financing sustainability. For example, the EU aims to mobilize €1 trillion in sustainable investments through its Sustainable Finance Action Plan using various policy tools:
Taxonomy: The EU Sustainable Finance Taxonomy provides a classification system delineating environmentally sustainable economic activities. This provides clarity for investors regarding ‘green’ investments.
Disclosures: The Sustainable Finance Disclosure Regulation (SFDR) mandates transparency around sustainability risks, impacts and products to empower investors with comparable ESG data.
Benchmarks: The EU Climate Transition and EU Paris-aligned Benchmarks allow channeling investments towards climate-friendly solutions through standardized low-carbon indices.
Green Bonds: With a dedicated Green Bond Standard, the EU is promoting the issuance of use-of-proceeds bonds for financing eligible green projects and assets.
These measures help overcome information gaps and mis-selling risks, directing capital at scale towards transition-enabling solutions like renewable energy and green infrastructure. Multilateral development banks are also increasingly prioritizing sustainable investments.
Why is Sustainable Finance Important?
There are several compelling reasons why the adoption of sustainable finance is gaining importance:
Mitigating financial risks: ESG issues like climate change, resource depletion, and social inequities pose growing risks to businesses and investments. A sustainable finance approach helps identify and mitigate such risks, protecting long-term returns.
Tapping new opportunities: The global shift towards a low-carbon, inclusive economy is creating new business opportunities in areas like renewable energy, green technology, and sustainable supply chains. Sustainable finance allows capturing these opportunities.
Meeting stakeholder expectations: Investors, customers, and employees increasingly expect companies to address ESG issues and transparently report on sustainability performance. Adopting sustainable finance practices helps meet these rising stakeholder expectations.
Future-proofing investments: Sustainable finance orientations investments towards long-term sustainability outcomes, ensuring their continued viability and returns in a resource-constrained world increasingly impacted by climate change and other environmental and social challenges.
Regulatory tailwinds: With policymakers mainstreaming sustainability through regulations on ESG reporting, disclosures, and taxonomy, sustainable finance is gaining policy support worldwide. Early adopters gain competitive advantages.
Mainstreaming Sustainable Finance
Recognizing its importance, policymakers and regulators are taking steps to mainstream sustainable finance through new rules and guidelines:
The European Union has introduced several regulations like the Sustainable Finance Disclosure Regulation (SFDR) and EU Taxonomy to reorient capital towards sustainable activities.
Stock exchanges are launching ESG segments like Euronext’s segment for sustainable securities.
The UK, Canada, Japan and other countries are also bringing in disclosure guidelines and sustainability-linked regulations.
Multilateral development banks are increasingly prioritizing green and sustainable investments.
Financial institutions are establishing dedicated sustainable banking windows and green investment funds.
Stock exchanges like Euronext are launching dedicated sustainability segments to promote sustainable investments.
Central banks are exploring ways to incorporate sustainability into monetary policy operations and financial stability mandates.
Generative AI is advancing rapidly, with pioneering models demonstrating vast potential to automate content creation. Companies like OpenAI, Anthropic and others have taken early leadership with groundbreaking research. Meanwhile, firms like Google, Microsoft and Amazon collectively pour billions into AI yearly and show no signs of slowing investment. These companies have already debuted powerful generative products, putting pressure on Apple.
Based on our analysis of the generative AI field and conversations with leading researchers, we estimate Apple will need to invest around $1-2 billion annually to effectively compete in this critical area over the next 5 years. While this represents a sizeable commitment, it is necessary to avoid losing ground to competitors aggressively funding generative AI development like Google, Microsoft and Amazon. These firms already collectively pour billions into AI each year and show no signs of slowing investment.
Our data suggests that in 2023 and 2024, Apple will buy between 2,000 and 3,000 and 18,000 to 20,000 AI servers. In 2023 and 2024, it will account for around 1.3% and 5% of global AI server shipments, respectively.
Apple’s Position
While Apple uses AI across its products, it has yet to launch a generative AI system or application. Internally developed models like Apple GPT and Ajax have not been integrated into products. Apple lags behind competitors in generative AI research and commercialization. Without dedicating proper resources, Apple risks losing the ability to drive innovation and capitalize on emerging opportunities in this critical field.
Nvidia’s HGX H100 8-GPU, built for generative AI training and inference, seems to be the most popular specification this year, so it’s likely that’s what Apple is buying for its AI servers. Some 4Q24 shipments may additionally include an upgrade to the B100 solution.
The average cost of an HGX H100 8-GPU server is $250,000. That’s why experts predict Apple will shell out at least $620 million on artificial intelligence (AI) servers in 2023, and another $4.75 billion the following year.
Generative models are rapidly growing in scale and capabilities. Training increasingly powerful models requires vast computing resources that come at a high cost. To develop world-class generative research and integrate related technologies into its products on a timeline similar to peers, Apple will need dedicated funding on the scale mentioned above. Anything less risks ceding leadership in a domain that may define the technology industry’s future.
Funding Needs
Our study into the topic of generative AI and our conversations with experts have led us to conclude that Apple will need to invest between $1 to $2 billion each year over the next five years. This scale of funding is necessary to develop world-class generative research, hire top talent, acquire capabilities, and integrate related technologies on par with industry leaders. Sustained investment below this level could severely limit Apple’s competitiveness in generative AI going forward.
Of course, the precise figure could vary based on strategic priorities and technological breakthroughs. But make no mistake – without serious commitment to generative AI in the billions, Apple’s ability to drive innovation in this sphere and capitalize on emerging opportunities will be limited. As with other transformative technologies, sustained investment is key to gaining a long-term competitive edge.
Recommendation
Our advice would be that Apple and other firms to carefully assess generative AI’s potential impacts and allocate commensurate resources to ensure they can actively shape, rather than merely react to, the changes to come. The winners of tomorrow will be those investing boldly in advanced AI today.
As a leading technology company, Apple recognizes the importance of artificial intelligence, particularly generative AI, in driving future innovation. However, substantial investment will be required for Apple to effectively compete in this critical area against peers aggressively funding AI development. In this report, we analyze Apple’s position in generative AI and estimate the level of funding needed over the next 5 years to close the gap with competitors.
We advise Apple to carefully assess generative AI’s impacts and allocate commensurate resources to shape emerging changes. The winners in technology industries are those investing boldly in advanced AI. Apple must commit serious funding in the billions for generative AI to remain competitive and a leader in driving innovation. Without such commitment, ceding ground to better-funded peers in this pivotal domain will be difficult to avoid.
Quantum computing is rapidly advancing from theoretical research toward practical business applications. Where it was once confined to laboratories, quantum technologies have reached an inflection point of readiness that is demanding attention from both technology leaders and mainstream enterprises.
As the technology reaches an inflection point of viability within the next two to five years according to many estimates, businesses must gain a working knowledge of quantum computing’s opportunities and limitations. Those preparing now by experimenting with available cloud-based resources and developing quantum roadmaps will find themselves well-positioned for the coming wave of innovation.
Materials Development Through Quantum Simulation
Daimler leveraged IBM’s quantum computer to model molecular structures, simulating different atomic configurations to design more efficient battery materials. This showed quantum’s potential to revolutionize materials science by testing hypotheses that would take classical computers millennia. Other work simulates organic photovoltaic cells and catalysts.
While challenges certainly remain, the field has made tremendous strides in the last five years alone. Quantum volume – a measure of processing capability – has increased exponentially on hardware from IBM, Rigetti, IonQ and other vendors. Meanwhile, software tools are maturing to help programmers without quantum physics backgrounds develop and test algorithms.
Financial Portfolio Optimization with Quantum Machine Learning
JPMorgan partnered with IonQ to test portfolio allocation algorithms on a quantum processor. Though in early stages, quantum machine learning models could one day optimize trillion-dollar investment portfolios to outperform classical AI. Several startups are also developing quantum risk analysis and other financial applications.
Quantum technologies have progressed significantly in recent years, attracting record levels of investment from both private enterprises and public institutions. As startups in the field become more established, venture capital funding reached new highs of $2.35 billion in 2022 according to McKinsey’s Quantum Technology Monitor.
Quantum Artificial Intelligence to Design New Medicines
Researchers at GlaxoSmithKline, Google and University of Southern California used quantum processors to simulate molecular docking and design potential drug candidates. Quantum AI may discover new medicines by screening billions of molecular structures far more efficiently than classical computers. The technique could transform drug discovery.
Looking ahead, quantum will integrate into mainstream IT environments much like cloud technologies before it. Major consulting firms including BCG and McKinsey have launched dedicated quantum computing practices to help clients strategize integration approaches. Meanwhile, tech giants from Amazon to Microsoft are investing heavily in quantum hardware and services to capture a leadership position in this next generation of processing.
This influx of capital is being driven by tangible signs that quantum computing is maturing from theoretical research into viable business solutions. Hardware performance continues to grow exponentially, with the number of quantum bits (qubits) doubling each year on average. Software is also advancing to simplify programming for non-physicists.
Solving Supply Chain Optimization Problems
Logistics heavyweight DHL explored using quantum annealers from D-Wave to tackle routing, inventory and delivery scheduling. Complex supply chain optimization problems involving thousands of variables are well-suited for quantum approaches. Successful tests could see broader adoption across transportation and manufacturing.
Moving forward, quantum technologies are on track to become integrated into mainstream IT environments within the next five years. Tech giants and consulting firms already offer dedicated quantum services, recognizing the opportunity in shaping this next generation of computing.
While challenges around error correction and scaling remain, the field has reached an inflection point where businesses must start preparing for quantum’s disruptive impact. Those who gain expertise now and develop quantum roadmaps will find themselves well-positioned to capture competitive advantages as innovation accelerates. With continued progress, quantum applications may revolutionize industries from automotive to finance in the coming decade.
While still in early stages, these examples show how quantum is beginning to solve problems beyond traditional computing’s reach. As the technology matures, its full capabilities for fields from energy to healthcare will start to emerge. Commercial integration will ramp up alongside hardware improvements in error correction and qubit scaling. The next decade will likely see quantum achieve critical mass and begin transforming major industries.
The New York Stock Exchange and NASDAQ have strategically expanded their reach in recent decades. NYSE has grown its footprint in Europe, Middle East, and Africa through acquisitions like Euronext. It now facilitates over $2 trillion daily trading volume across listed companies with a combined $28 trillion market capitalization.
NASDAQ similarly diversified its brand through international listings and joint ventures. Though it remains strongest in technology stocks, NASDAQ now links over 50 marketplaces in over 50 countries. Both American giants have thus strengthened their first-mover advantage while adapting to a more globally integrated financial landscape.
In Asia, the Tokyo Stock Exchange stands out as the world’s third largest with a domestic market capitalization over $6 trillion. However, with Japan’s stagnant population and economic growth, other Asian hubs have gained ground. The Shanghai Stock Exchange, for instance, now ranks fourth globally with $5.4 trillion in listed companies as China rapidly industrializes.
Meanwhile, the Hong Kong Stock Exchange has emerged as a major gateway between East and West. It lists over 2,300 companies from China and other emerging markets seeking international investment. With a market cap exceeding $4 trillion, HKEX has become particularly influential as China continues opening its financial sector to global capital.
Beyond the exchanges already discussed, others have also grown their influence in recent decades. Euronext, formed from the merger of several European stock exchanges, now facilitates over $4.7 trillion in listed company market cap. It has strategically expanded beyond its origins in Paris, Amsterdam, Brussels and Lisbon through acquisitions of exchanges in countries like Ireland and Norway.
In the Middle East, Saudi Arabia’s Tadawul exchange has emerged as the dominant market for the region. It facilitates daily trading volume exceeding $2 billion as Riyadh leverages its oil wealth to diversify industries and attract greater foreign investment.
Meanwhile, Brazil’s B3 and Mexico’s Mexican Stock Exchange have strengthened their positions as Latin America’s largest stock trading platforms. B3 now lists over 400 companies with a market cap over $1.5 trillion as Brazil transitions to a more market-oriented economy. These global exchanges will likely continue adapting through strategic partnerships, new listings, and product innovation to remain competitive. The healthy rivalry they foster helps optimize capital allocation worldwide and promote greater financial inclusion across borders over the coming decades.
The Union Finance Ministry’s Annual Economic Review 2022-2023 is a helpful resource since it provides an in-depth evaluation of the economy’s performance in the prior year and a projection for growth in the next year, 2024. This affects the macroeconomic aspect of multiple countries.
The Bureau of Labor Statistics report paints a picture of steady but slower economic growth through 2024. GDP is expected to expand at an average of 2.3% per year, a more modest pace than the pre-Great Recession period. This still signifies the economy will continue growing, but at a healthier, sustainable rate rather than the rapid gains seen earlier.
Economic Outlook Remains Positive but Uncertain
The unemployment landscape will gradually transform as well. Nearly 5 million more jobs will be added over the projection period, sending joblessness down to just 5.2% by late 2024. This decline will be gradual as employers bring on staffing in tune with demand. Those still seeking work may find new opportunities emerging in fields like technology, healthcare, education and business services.
Manufacturing is projected to achieve stability after massive cutbacks in the 2000s, holding around 12.5 million jobs. Though factory employment won’t surge, the sector is expected to at least maintain current worker levels. This provides reassurance for communities dependent on manufacturing. Countries’ macroeconomic opportunities increase as more jobs are added in this particular segment.
Our analysis of a different report shifts the attention on the euro area’s fiscal situation & brings it to sharp focus. Deficits are forecasted to shrink in 2023 but stay above pre-COVID highs, a sign of ongoing public support needs. Debt loads will plateau at historical ceilings, raising debt sustainability worries in heavily indebted nations.
Fiscal policy guidance calls for targeted measures to soften inflation and energy price blows on households and businesses. But the Board also advises fiscal tightening where inflation and debt risks are most threatening. This balanced approach aims to aid macroeconomic situations while maintaining hard-won debt control.
Labor Markets Transition with New Technologies
Additionally multiple shifts in trends can be seen in the employment industry. Professional and business services are expected to see strong gains of 1.9 million jobs as the economy increasingly relies on technical, administrative and consulting work. Healthcare and social assistance will add 2.3 million positions thanks to population aging trends driving demand. Leisure and hospitality also stands to benefit from continued consumer spending with 1.1 million new jobs projected in food services, accommodation and entertainment.
Manufacturing employment holds potential for upside surprises too. While the sector is forecast to remain steady at 12.5 million workers, emerging technologies like 3D printing, robotics and advanced materials could spur unforeseen factory job growth. Sectors involved in producing such innovations like computers, electronics and transportation equipment may see hiring outpaces projections. Overall, the manufacturing landscape is poised to transition toward more high-tech, specialized production roles, leading to a macroeconomic spur.
The European Fiscal Board report sheds light on how debt sustainability concerns vary across euro area members. While all countries saw debt ratios spike during the pandemic, nations like Greece and Italy entered the crisis with much higher pre-existing debt loads. The EFB recommends Greece, Italy and others with elevated debt risks prioritize fiscal consolidation to safeguard against future economic shocks or interest rate rises.
Meanwhile, countries like Germany and the Netherlands entered the pandemic from positions of fiscal strength and maintain debt ratios well below most peers. The report suggests these low-risk nations have more flexibility for supporting their economies through targeted measures if needed. A balanced, country-specific approach to fiscal policy aims to aid growth while preventing debt crises down the road.
Fiscal Stewardship Aids Stability
Looking beyond 2024, many experts anticipate technology’s ongoing impacts on jobs and growth. Automation may displace some roles but also create new opportunities across sectors as innovation accelerates. Demographic shifts like population aging in Europe and developing nations will shape future labor markets and economic drivers. Evolving trade relationships, climate policies and geopolitical dynamics present unknown variables that could influence projections. Overall, steady expansion appears likely through 2024 if current conditions hold.
While steady progress is anticipated based on current economic fundamentals, numerous uncertainties remain that could impact projections and require adaptive policymaking. Global events like Russia’s war in Ukraine, ongoing trade tensions, and geopolitical realignments pose risks to growth assumptions. Domestically, future pandemic waves or other public health crises may disrupt activity in hard-to-predict ways.
Financial markets and commodity prices demonstrate high volatility in the current environment, leaving open the possibility of sudden shifts that filter through to output and jobs. Inflation has also proven more stubborn than expected, necessitating nimble central bank response. If price pressures intensify or persist, consumption and business investment could be dampened.
Given such unpredictable macroeconomic and geopolitical variables, maintaining flexibility to adjust fiscal and monetary stances proactively will be key. Continued close monitoring of incoming economic data on production, spending, hiring and prices permits calibrating projections and policies accordingly. Country-specific circumstances like debt levels must also guide policy tailoring.
Overall, while the baseline outlook is positive, numerous Black Swan risks cloud the horizon. Agile, evidence-based approaches can help economies navigate an uncertain landscape to maximize stability and prosperity through short and long-term economic cycles.
Metaverse, a concept named by now “Meta” previously known as Facebook. The term metaverse refers to the concept of three-dimensional virtual spaces put together to form a universe in itself. It involves a combination of multiple platforms that allow users to socialize, game, meet and work in a three-dimensional space.
Metaverse, powered by Augmented Reality (AR) is gaining traction in various domains. The video gaming industry is said to be in its clooney years as it experiences major transformational shift due to the emergence of metaverse. Amid the rapid growth in the gaming industry post COVID-19 outbreak its basic drivers are still the fundamentals of the industry- faster processors, improving graphics and enhancement of overall gaming experience worldwide.
In addition, the advancement in global communication networks will accelerate the uptake of cloud-based games creating entirely new ways for users to interact and socialize while driving revenue for the gaming companies.
According to a survey by Amsterdam-based industry tracker Newzoo, the worldwide games market is projected to earn about $188 billion in sales in 2023, up 2.6 percent from this year.
The Metaverse Gaming Impact, Explained!
With the concept of a fictional universe becoming reality there is a significant upsurge with the number of early adopting gaming companies experimenting with a metaverse presence. For instance- the widely played Minecraft and Fortnite games, as well as the popular Roblox game platform, have incorporated many aspects of the metaverse, including virtual worlds where players meet to play games and use social features such as in-game chats.
As the gaming industry matures, the metaverse will continue to incorporate various technologies, such as VR, AR, and 3D functionality. Tim Stuart, CFO of Microsoft’s Xbox Unit stated, “Within the gaming space, competition for engagement makes our business grow. It creates innovation and new ideas. This market is growing because there are new entrants, there are new game players, and there is a flow of new content unlike anything we’ve seen in the past.”
It is observed that an estimated 2.9 billion people – more than one out of every three people on the planet played a video game in 2021, when global revenue for the industry exceeded $193 billion. In addition, from 2016 to 2021, gaming grew at a compound annual growth rate of 15.6%
With customer expectations rising dramatically, a key pillar of success for the gaming companies will be continuous innovation and product differentiation. While companies across every sector are still imagining business possibilities the metaverse offers, gaming executives already see growth potential and have a positive outlook for this industry in the near future. By 2025, the global gaming market is predicted to be worth $211 billion, with mobile gaming accounting for $116 billion of that.
India has shown tremendous economic growth over the past few decades and is well positioned to achieve the ambitious target of becoming a $30 trillion economy by 2050. Currently the fifth largest economy globally with a GDP of $3.5 trillion, India has consistently grown at an average rate of 6-7% annually over the past 10 years.
Key Priority Areas for Sustained Growth
To achieve sustained high growth, India must focus on key priority areas. Job creation will be vital to maximize productivity and incomes of the large workforce. Labor-intensive manufacturing and infrastructure development can generate massive employment. However, skills training will be needed to match industry demands. National programs are being implemented to upskill over 400 million Indians by 2022. Continued vocational training initiatives ensuring skills match the needs of a digital, globalized economy will be essential.
Projections from institutions like the IMF and World Bank estimate India’s GDP will expand to $8-10 trillion by 2030, driven by strong domestic demand and increasing digitalization across sectors. For India to reach the $30 trillion target by 2050, it needs to sustain a real GDP growth rate of over 8% annually for the next 25+ years. This seems achievable given India’s strong economic fundamentals and ongoing policy reforms.
Demographic Dividend and Economic Prospects
India’s growing population, currently at 1.4 billion people with 65% under the age of 35, provides a huge talent pool to fuel future growth. As the world’s largest workforce by 2027, India’s demographic dividend will power the economy. Rapid urbanization is also increasing consumption expenditure – the middle class is projected to rise from 30 crore currently to over 50 crore by 2030.
The government’s initiatives such as Make in India, Digital India, and Startup India are helping develop world-class infrastructure and an innovation-driven entrepreneurial ecosystem. These efforts have attracted significant foreign investments across sectors like digital, manufacturing, renewable energy, and infrastructure. Sectors offering immense growth potential include digital economy, renewable energy, agriculture, healthcare, and tourism.
India’s Role as a Global Manufacturing Hub
Geopolitical factors and China’s declining workforce make India an attractive alternative manufacturing hub globally. To achieve its $30 trillion goal, India must focus on job creation, skill development, ease of doing business reforms, self-reliance in strategic industries, and ensuring widespread benefits of economic growth. Continued reforms and political stability will also be important supporting factors.
Agricultural Modernization and Infrastructure Development
Agriculture modernization presents opportunities to raise farmer incomes and productivity. The sector currently engages over 50% of India’s workforce but contributes only 15-20% to GDP. Adopting advanced techniques, expanding cold storage and food processing infrastructure, developing private markets, and providing access to credit and insurance can boost agricultural growth. This will support rural consumption and structural transformation away from agriculture over time.
Infrastructure development across transport, digital connectivity, energy and urban development is a major government priority. Trillions of dollars will be invested in highways, railways, ports, airports, renewable energy, smart cities, and digital infrastructure under the National Infrastructure Pipeline. Completing infrastructure projects on schedule while ensuring transparency and sustainability can accelerate growth across sectors.
According to the National Manufacturing Policy of 2011, the share of manufacturing in India’s GDP has stagnated at 15-16% since 1980 while the share in comparable economies in Asia is much higher at 25 to 34%. However, the government has taken several initiatives to promote the manufacturing sector, including the introduction of Goods and Services Tax, reduction in corporate tax, interventions to improve ease of doing business, FDI policy reforms, measures for reduction in compliance burden, policy measures to boost domestic manufacturing through public procurement orders, and Phased Manufacturing Programme (PMP)
Promoting Manufacturing and Digital Economy
According to Statista, in 2021, the manufacturing sector’s share of GDP in India was around 14%. The report by NITI Aayog shows that the manufacturing sector’s share of GDP was 16.1% in 2011-12 and 16.2% in 2017-18. The India GDP sector-wise report by StatisticsTimes.com shows that the manufacturing sector’s share of GDP was 25.8% in 2021.
Overall, the manufacturing sector’s share of GDP in India has been stagnant for several years, but the government has taken initiatives to promote the sector. The exact share of manufacturing in India’s GDP varies depending on the source, but it is clear that there is room for growth in this sector.
The digital economy’s potential is immense given India’s young demographics and improving internet access. A target of achieving a $1 trillion digital economy by 2025 is being pursued through initiatives like Digital India. Sectors like IT/business services, digital payments, e-commerce, online gaming and edtech are growing exponentially. Developing AI, 5G networks, blockchain and other emerging technologies presents opportunities for India to become a global innovation hub.
Achieving a $30 Trillion Economy by 2050
If India utilizes its demographic dividend, policy initiatives, and sectoral opportunities effectively while sustaining high growth rates, becoming a $30 trillion economy by 2050 seems very achievable and will cement its place among the world’s largest economies. Careful planning and execution will be crucial over the coming decades.
Enhancing Geopolitical Influence and Foreign Policy
India’s rising consumption and manufacturing base also enhances its geopolitical influence as a strategic partner. Continuing trade and investment deals while reducing reliance on any single country strengthens India’s position. Pursuing self-reliance in critical areas alongside cooperation and capacity building with friendly nations will be a key foreign policy objective.
We have all begun preparation for Saturday afternoon’s most hyped event, yes you guessed it right. We are talking about the India Vs Pakistan World Cup match. According to some reports, the resale of tickets has seen sky-high prices. As per an article in Business Standard “a 32-year-old Mumbai native, who now works at a fintech company, in August bought a 2,500-rupee ($30) ticket for Saturday’s match. After a change of plans, he decided to resell the ticket on X, the platform formerly known as Twitter, scoring 22,000 rupees for it.”
This might let us think that the cricket governing body must have earned the majority of its combined revenue of Rs 27,411 crore over the past five fiscal years (FY18-FY22) through ticket sales. But that doesn’t even come in the top 5 sources of their revenue.
The business model of BCCI has made it the richest cricket governing board out of all the cricket-playing regions in the world and is one of the major boards of cricket, alongside the England and Wales Cricket Board and Cricket Australia. So, it obviously made us curious about what makes BCCI swim in cash. Here are the Top revenue sources of BCCI
1) Media Rights
One of the massive sources of income for the BCCI is through their broadcasting media rights. The board grants the media broadcasting rights of the matches that feature the Indian cricket team to the networks for a huge sum of money. The advertisers of different marketing agencies know this to be the best time to showcase their advertisements to a large, worldwide audience. This makes each and every broadcast of the game very valuable, thus the BCCI charges a lot of money for the media rights to broadcast the games.
2) Title Sponsorship
The second spot on the topic of how BCCI earns money is the title sponsorship. One of the biggest spots for advertisement is surely attaching the company’s name to one of the biggest cricket championship titles in the country. Yes, the spot of title sponsorship is a massive source of income for the BCCI in recent years. The company that sponsors the title of a cricket event, receives the most exposure, meaning more space for advertisement, a bigger logo, an enhanced time slot, the name and logo of the company over the trophy area, and a lot more. To achieve this spot, which is a golden opportunity for companies in terms of advertisement, they have to pay a huge sum of money to the BCCI.
3) Team Sponsorship
Another huge contribution to the revenue model of the BCCI is through their official team sponsorship. Remember the Sahara logo at the center of the Indian national cricket team, worn by legendary players while representing the country on the international stage of cricket? Imagine the amount of publicity and marketing benefit it does for the company. Hence being able to sponsor that is another golden opportunity for these types of companies, eventually paying a huge sum of money to the BCCI for its rights.
4) Official Kit Sponsors
The company that sponsors the official kit of the team has to pay a massive amount to the BCCI for their logo placement on the jersey. Nike was the previous kit sponsor for the team and had to pay about 12.13 Million USD to the board each year. In the five-year deal, Nike had to pay nearly 60.6 Million USD at the end of the term to the BCCI. The contract ended with Nike back in 2020 and since then, MPL has taken the charge of the official kit sponsors for the Indian cricket team, paying the base price of INR 65 lakhs per match and a total of INR 3 crore each year as the official merchandise partner. Thus, in the question of how BCCI earns money, you can check kit sponsorship on the list as a major part of it.
5) Revenue Earned via Bilateral Series
The ICC or the International Cricket Council is responsible for hosting various international cricket series between the cricket-playing countries. You have definitely heard about the India Tour of Australia, or the New Zealand Tour of India, etc. where a large amount of revenue is collected by the cricket boards of the participating countries. Similarly, whenever team India plays a bilateral series with a country, the BCCI get a part of the revenue earned from the events. The BCCI is among the big three cricket boards in the world, and due to their huge associated viewership of millions of Indian cricket fans, they earn a major share. Just accounting for the 2019-20 cricket series, the BCCI had earned around INR 950 crores in revenue.
6) Revenues from the Indian Premier League
Coming at the sixth spot on the topic of how does BCCI earn money, is the contribution of the IPL. The Indian Premier League is the biggest domestic T20 cricket tournament in the whole world. The IPL is one of the most attended, marketable and viewed sports events in the whole world. So it is natural for the BCCI-created IPL to generate massive amounts of revenue for the board throughout the years. Apart from title sponsorship, tournament sponsorship, media rights and the other previously mentioned sources of the tournament gaining money, there are a lot more things that produce revenue for the BCCI through IPL. Like other forms of advertisement throughout the events, stadium tickets, percentage of earnings from the franchises, and other things. All of these come into the massive picture of the total revenue earned by the BCCI through just their IPL brand.
We are all gearing up for the highly anticipated event on Saturday afternoon – the India Vs Pakistan World Cup match. Reports suggest that ticket resale prices have skyrocketed. According to an article in Business Standard, a 32-year-old Mumbai resident, who now works at a fintech company, purchased a 2,500-rupee ($30) ticket for the match in August. However, due to a change of plans, he decided to resell the ticket on X (formerly known as Twitter) and managed to sell it for 22,000 rupees.
Surprising Revenue Sources for BCCI
One might assume that ticket sales contribute significantly to the cricket governing body’s revenue, considering the exorbitant prices. However, ticket sales do not even rank among the top five sources of revenue for the Board of Control for Cricket in India (BCCI).
The BCCI’s business model has made it the wealthiest cricket governing board globally, alongside the England and Wales Cricket Board and Cricket Australia. Naturally, this piques our curiosity about what enables the BCCI to amass such wealth. Let’s explore the top revenue sources of the BCCI:
Media Rights: One of the primary sources of income for the BCCI is the sale of broadcasting media rights. The board grants networks the rights to broadcast matches featuring the Indian cricket team for a substantial sum of money. Advertisers from various marketing agencies recognize this as an opportune moment to showcase their advertisements to a vast global audience. Consequently, each broadcast of the game becomes highly valuable, allowing the BCCI to charge a significant amount for media rights.
Title Sponsorship: Another major source of income for the BCCI is title sponsorship. Attaching a company’s name to one of the country’s most prominent cricket championships offers immense advertising opportunities. The title sponsor receives extensive exposure, including more advertising space, a larger logo, an enhanced time slot, and the company’s name and logo displayed prominently in the trophy area. To secure this coveted spot, companies must pay a substantial sum to the BCCI.
Team Sponsorship: Official team sponsorship also contributes significantly to the BCCI’s revenue model. Remember the Sahara logo at the center of the Indian national cricket team’s jersey, worn by legendary players representing the country on the international stage? The publicity and marketing benefits for the sponsoring company are immense. Thus, sponsoring the team presents a golden opportunity for companies, leading them to pay a substantial amount to the BCCI for the sponsorship rights.
Official Kit Sponsors: The company that sponsors the official kit of the Indian cricket team must pay a substantial amount to the BCCI for logo placement on the jersey. Nike, the previous kit sponsor, paid approximately 12.13 million USD annually to the board in a five-year deal, totaling nearly 60.6 million USD. Since 2020, MPL has taken over as the official kit sponsor, paying a base price of INR 65 lakhs per match and a total of INR 3 crore annually as the official merchandise partner. Kit sponsorship, therefore, plays a significant role in the BCCI’s revenue generation.
Revenue from Bilateral Series: The International Cricket Council (ICC) hosts various international cricket series between cricket-playing countries, such as the India Tour of Australia or the New Zealand Tour of India. These events generate substantial revenue for the cricket boards of the participating countries. When Team India plays a bilateral series, the BCCI receives a share of the revenue earned from the events. With millions of Indian cricket fans as viewers, the BCCI, being one of the big three cricket boards globally, earns a significant portion of this revenue. In the 2019-20 cricket series alone, the BCCI earned approximately INR 950 crores in revenue.
Indian Premier League (IPL) Revenues: The Indian Premier League (IPL), the world’s largest domestic T20 cricket tournament, occupies the sixth spot in terms of revenue generation for the BCCI. The IPL is highly attended, marketable, and viewed worldwide, making it a lucrative source of income for the board. In addition to title sponsorship, tournament sponsorship, and media rights, the IPL generates revenue through various other means, including advertisements during the events, ticket sales, a percentage of earnings from franchises, and more. All these factors contribute to the substantial revenue earned by the BCCI through the IPL brand.
Rising Income Tax Payments by BCCI
Income tax payments made by the Board of Control for Cricket in India (BCCI) during the fiscal year 2021-22 increased by 37% year over year, reaching a total of Rs 1,159 crore.
Indian business news has been filled with M&A and restructuring activity in the past few months. We saw the country’s largest private bank HDFC Bank and the Largest housing finance company HDFC (Housing Development Finance Corporation) making it the third largest market capitalization as of April 2023 just behind the behemoth reliance industries and Tata Consultancy Services.
Reliance Industries has been on an acquisition spree in 2023, acquiring majority stakes in companies involved in sectors ranging from Retail to Gaming tech. Following are some of the major acquisitions made by Reliance
The epic acquisition of Air India by Tata group, Zomato acquiring Grofers in May 2023, Paytm founder and CEO Vijay Shekhar Sharma will buy a 10.3% stake (worth $628 million) in the fintech firm from China’s Ant Financial (known as Ant Group now) in a no-cash deal. These are just a fraction of the headline acquisitions that we have witnessed this year.
This trend has been carried forward from 2022, as per Deloitte M&A Trends 2023 The M&A market in India crossed USD 160 Bn during 2022.
Key Factors Driving M&A Growth
The rise in M&A activity is attributed to strong domestic demands at a time when global demand was stagnant with uncertainty and interest rate hikes in the U.S. Corporates had healthy cashflows which allowed them to make strategic acquisitions at a time when markets were on low with little activity giving corporates the required headspace to engage in such activities.
Technology, media, and telecom saw the greatest activity with 330 overall delas in 2022. As we saw in the beginning 2023 has witnessed a greater activity in terms of overall value and no. of deals.
However, in an environment where global demand has subsumed due to a variety of factors, the Indian private economy is relatively in a stable and healthy situation. The Indian firms with relatively healthier cashflows have identified the global economic crunch as an opportunity to make strategic acquisitions. This has allowed them to get attractive valuations and work towards increasing their margins with backward integration.
Successful acquirers are increasingly looking towards the creation of “Ecosystem Clusters” which can help them to expand their business base and penetrate deeper into the market. It is obvious that big corporations with healthy balance sheets hold a competitive edge wherein using their financial and operational capability they can integrate much faster and effectively with their strategic acquisition. The government policies have also contributed to the growth in M&A that we are witnessing. As part of the government’s continued emphasis on easing the process of doing business, there have been several regulatory and administrative changes of note. These include a push towards digitization in addition to foreign exchange regulations for inbound and outbound investments continuing to be relaxed. Meanwhile, the judicial system has adopted virtual court technology, thereby increasing accessibility and reducing cost and litigation time.
Future Investment Trends
With all such factors coming together, the opening up of several sectors & investor-friendly reforms brought in, an increase in the quantum of investments is anticipated. Investments in key sectors such as pharmaceutical, technology, telecommunication, and infrastructure (including roadways and ports) are expected to continue to attract both domestic and foreign investors and dominate the M&A market. ESG investments and conducive government policies may also result in increased investment.
As the world progresses towards a more digital future, distributed ledger technologies have emerged as an important area of innovation. Both Hedera Hashgraph and blockchain aim to decentralize record keeping through distributed networks, but they approach the challenge in different ways. With new technologies vying for adoption, it is prudent to examine the relative merits and applications of each approach.
Who To Vote for The Best-Distributed Ledger Technology?
At their core, both Hedera Hashgraph and blockchain seek to distribute trust through consensus-based networks instead of centralized authorities. This allows for transparent, immutable records without single points of failure. However, they diverge in their technical implementations. Blockchain utilizes a linear chain of blocks containing sequential transaction records. Each new block requires proof of work or stake validation from nodes across the network. This process can become computationally intensive at scale.
In contrast, Hedera Hashgraph employs an asynchronous Byzantine fault tolerant algorithm called gossip about gossip. Through this, nodes can validate transactions and reach consensus in parallel rather than serially. Proponents argue this allows Hashgraph to process thousands of transactions per second compared to tens for blockchain. The asynchronous nature also removes mining incentives, prioritizing fairness over competition.
Consensus Mechanisms and Validation Processes
The consensus mechanisms employed by Hedera Hashgraph and blockchain are a key point of differentiation between the two distributed ledger technologies. Blockchain relies primarily on proof-of-work or proof-of-stake to validate transactions and reach network-wide agreement.
Proof-of-work involves miners competing to solve complex cryptographic puzzles, with the first to solve it gaining the right to validate the next block of transactions. However, this process consumes vast amounts of energy as the puzzles increase in difficulty. Proof-of-stake instead selects validators based on their holdings in the native cryptocurrency. While more efficient, there are concerns it could become centralized if ownership is highly concentrated.
Hedera Hashgraph takes a novel approach called gossip about gossip. Rather than competing, nodes communicate approved transactions and timestamps to their peers in the network. Through this asynchronous process, nodes can validate transactions and order them based on virtual voting from across the entire network simultaneously. Proponents argue this results in a fairer, more decentralized consensus without wasteful mining incentives.
Performance and Scalability
While speed and efficiency advantages are compelling, blockchain currently enjoys far broader adoption thanks to its open governance model. As a patented technology, Hashgraph is controlled by its governing council of major corporations. For some use cases, the centralized oversight may discourage participation. Blockchain’s decentralized nature better enables grassroots innovation and independent development.
Both technologies show promise, but their strengths suit different applications. Public, transparent records like digital currencies currently find blockchain a more natural fit. However, as distributed systems assume more vital private sector roles, Hedera Hashgraph’s performance characteristics could make it preferable for supply chain management, IoT networks, or other performance-critical services.
The performance implications of these different mechanisms are also notable. Blockchain’s sequential validation process can currently only handle a limited number of transactions per second depending on the implementation. In contrast, Hedera Hashgraph’s parallel gossip-based approach has demonstrated throughput in excess of 10,000 transactions per second in testing.
Additional Analogous Notes
Hedera Hashgraph offers significant performance advantages over blockchain-based networks like Bitcoin in terms of transaction throughput. Where Bitcoin can only handle 3-7 transactions per second maximum, Hedera has demonstrated over 10,000 transactions per second in testing. This level of scalability could make Hashgraph more suitable than blockchain for applications requiring high volume.
The energy efficiency of Hedera is also a major benefit, with estimates that a single transaction uses over 5.8 million times less energy than Bitcoin. This significant reduction in carbon footprint has implications for sustainability, especially as transaction volume grows.
Compared to other blockchain platforms, Hedera achieves its high performance without relying on power-intensive mechanisms like proof-of-work. Instead, its gossip-based consensus protocol and acyclic graph structure allow for rapid, distributed validation in a more streamlined manner.
Potential Applications Based on Attributes
For use cases like supply chain management or micropayments, this level of scalability could give Hashgraph a clear advantage. However, blockchain has established a first-mover advantage through the popularity of cryptocurrencies, and proof-of-work remains the most stress-tested model to date. Overall, continued development of both technologies promises to drive further innovation in distributed systems going forward.
While Hedera has clear advantages in these areas, it is still in earlier stages of deployment and adoption compared to major blockchain networks. Further real-world testing will still be needed, especially as network size increases, to fully validate the scalability and security of its consensus approach. Continued development on both technologies promises ongoing innovation in distributed ledger solutions.
Overall, healthy competition between the approaches will drive continued progress in distributed ledger technologies for the benefit of businesses and consumers. Further real-world use and development will determine which model proves most versatile.
The likelihood of an organization incurring losses or being exposed due to a cyber-attack or data breach is referred to as cybersecurity risk. Cybersecurity risk includes the possibility of harm or loss related to technical infrastructure, technology usage and the reputation of the concerned company.
As the worldwide dependence on computers, networks, social media and data rises, firms are finding themselves increasingly exposed to cyber threats. Unprotected data often cause data breaches, a typical type of cyber-attack that has a substantial negative impact on businesses.
WHAT IS CYBERSECURITY?
Cybersecurity is a set of techniques aimed at safeguarding internet-connected systems like computers, servers, mobile devices, electronic systems, networks and data from malicious attacks. The term cybersecurity comprises two parts i.e., ‘cyber’ refers to technology including systems, networks, programs and data while ‘security’ pertains to the protection of systems, networks applications and information. It is also termed electronic information security or information technology security.
IMPORTANCE OF CYBERSECURITY
Financial institutions, healthcare establishments, governments and manufacturing industries have made Internet-connected devices an integral part of their operations. These organizations possess delicate information i.e., intellectual property, personal data and financial records that can result in undesirable consequences if left exposed or accessed without authorization.
This situation provides a conducive environment for intruders and other malicious actors who aim to infiltrate such systems for motives ranging from financial gain to extortion, social or political goals or even vandalism.
BENEFITS OF CYBERSECURITY
Securing data and network
Preventing unauthorized access
Swift recovery post-breach
Ensuring the security of end-users and endpoint devices
Complying with regulatory requirements
Ensuring continuity of operations
Enhancing the company’s reputation, trust, and credibility among developers, partners, consumers, stakeholders, and employees.
TYPES OF CYBERSECURITY THREATS
Phishing
Phishing is a form of cybercrime where the sender appears to be from credible sources such as financial institutions and online marketplaces like PayPal, eBay, friends or colleagues. The targets are approached via email, phone or text message with links that trick them into clicking on suspicious websites that ask for highly confidential data like banking information, credit card details, social security numbers and login credentials. These links may also install malware allowing remote access by hackers.
Malware
Malware threat is inclusive of spyware, ransomware, worms and viruses. It can install malicious software, obstruct access to computer resources, cause system failure or even covertly transmit confidential data from your storage systems.
Man-in-the-middle (MITM) attack
A Man-in-the-Middle (MITM) attack is when hackers insert themselves into a two-party online transaction. By doing so, they can easily filter and extract necessary data. MITM attacks happen frequently on unprotected public Wi-Fi networks.
SQL Injection
SQL injection is a prevalent cyber-attack where malicious SQL scripts are executed by cyber criminals to manipulate the backend database and access confidential information. Post successful infiltration cyber attackers can view, change and even delete sensitive data including private customer details, user lists and crucial company resources stored in the SQL database.
Distributed Denial of service DDoS
A distributed denial of service (DDoS) attack is a malicious activity in which cyber criminals disrupt the usual traffic of targeted servers, services or networks by flooding them with several IP addresses fulfilling legitimate requests. Such attacks can make the system unusable by overloading servers significantly slowing down their performance or temporarily taking them offline and preventing organizations from executing essential functions.
Adware
Adware is a type of malware often referred to as advertisement-supported software. This virus is classified as a potentially unwanted program (PUP) since it installs without user consent and generates unsolicited online ads automatically.
Domain name system (DNS) attack
DNS attack refers to a form of cyber-attack where attackers leverage shortcomings within the Domain Name System with the goal to redirect users from legitimate websites to malevolent sites (DNS hijacking). This type of attack enables cyber criminals to steal confidential information from compromised computers. Since DNS infrastructure is an integral component of internet architecture this threat poses a severe cybersecurity risk.
CIA TRIAD
The foundation of security for any organization relies on three fundamental principles i.e., Confidentiality, Integrity and Availability also known as CIA, it has constantly served as an industry-standard in computer security since the inception of the first mainframes.
Confidentiality: Confidentiality principles assert that sensitive information and operations can only be accessed by authorized parties who have been granted permission. E.g., trade secrets, military secrets or personal data.
Integrity: Integrity principles assert that only authorized people and tools can modify, add or remove crucial information and functions. Altering of the data by any unauthorized person can lead to a violation of integrity. Incorrect data entered into the database by a user will affect its accuracy and completeness.
Availability: The fundamental assertion of availability principles is that the services, functions and data must be accessible as per pre-determined parameters based on various service levels for immediate use.
CYBERSECURITY TOOLS
Penetration testing
Antivirus software
Firewalls
Staff training
Managed Detection and Response Service (MDR)
Public Key Infrastructure Service (PKI)
CONCLUSION
At Ruskin Felix Consulting LLC, we offer complete cybersecurity risk consulting services; helping businesses like yours mitigate risks through risk assessments, vulnerability management, penetration testing and incident response planning among others.
Cybersecurity risks can be complicated – but we make things easy for you. Our ultimate goal is to help you create and maintain a secure technology environment so that y’all can focus on your business operations with peace of mind.
Let us help you protect your business from data breaches and cyber threats. Ruskin Felix Consulting LLC – your trusted partner in data security. You can contact us at contact@ruskinfelix.com
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