If Not AI, Then What? Exploring Investor Interests In 2024
The useful ETF angle here is not โwhat wins next,โ but how investors can express changing sector conviction without building a concentrated single-stock bet. The article points to a broadening of interest beyond AI into cybersecurity, energy transition, healthtech, industrial reshoring and other thematic pockets. For ETF investors, that matters because the opportunity set is increasingly about exposure design: deciding whether to own a broad sector basket, a narrower theme, or a more diversified allocation that can absorb leadership changes.
Composition is the first filter. Many thematic ETFs look similar in marketing but differ sharply in what they actually hold. A cybersecurity fund, for example, may be dominated by software and services names rather than pure โsecurityโ vendors; an energy-transition ETF can blend utilities, industrials, semiconductors and battery suppliers. That means investors should check underlying revenue sources, geographic mix and concentration before assuming a theme gives clean exposure to a single trend.
Cost and structure also matter more in fast-moving themes. When a sector attracts heavy interest, fund flows can improve liquidity, but crowded trades can also widen spreads or magnify short-term volatility. For long-term investors, the key question is whether the ETF is a temporary momentum vehicle or a durable building block for portfolio diversification. Broad sector funds and multi-theme sleeves often fit rebalancing better than narrowly defined stories that can quickly become overcrowded.
A practical takeaway is to separate narrative from allocation. Investors do not need to pick one โnext AIโ theme. Instead, they can use ETFs to spread exposure across areas with different drivers: digital security, industrial transformation, healthcare innovation and energy infrastructure. That approach helps turn a changing market story into a more disciplined portfolio decision.
The rise of traditionally overlooked industries such as agtech, proptech, construction, legal tech, and oil/gas is also anticipated.
Valerie further comments, โI have seen a strong interest in manufacturing, including a strong push for nearshoring and โmade in the USโ brand, general prop-tech and construction expanding all the way to space as a new frontier. Satellite technology, reusable rockets, new materials, and even space-based manufacturing are on the rise. Public-sector interest in these areas is growing, leading to increased venture capital movement towards dual-use technologies. Green tech and climate tech continue to be strong areas for VC focus, with an increasing number of firms adding these sectors to their investment portfolios. The current geopolitical climate suggests that investments in Gov Tech and critical technologies will become more visible, stimulating a new wave of startups and capital allocations. Andreessen Horowitz’s formation of the American Dynamism fund supports this trend, expected to strengthen in the coming years.โ Karsybaev reflects, โOur fund has consistently focused on sectors like agriculture and real estate. Recent investments, such as in Pippin Title and BoomGrow, are disrupting traditional practices like title searches and sustainable farming.โAI stands to benefit certain sectors immensely by integrating its solutions. Healthcare, legal tech, and software are prime examples.
โWe are very bullish on the outlook of the amount of innovation that technology is bringing to healthcare and incremental improvements often times lead to substantial results. Executives in Healthcare who are also experienced in being of value-add Board members are in high demand and we are on the constant look out for such talent. On the other hand, recent investments in companies like Cerebra AI have provided us with an opportunity to join a company that validated their thesis in a smaller market and now looking to bring their stroke prediction software to US market,โ Karsybaev states. Valerie adds, โAll industries will benefit from AI in one way or another but I personally believe that the democratization and a dramatic cost reduction in software development will have a major impact on our businesses. Together with the way to learn and work with the information. Healthcare and legal tech are probably the areas where I see the most fast-moving changes.โTechnological Innovations and Global Trends in 2024
2024 also promises to be influenced by international events like the Paris Olympics, affecting sports tech and media, while global elections could sway the economy unpredictably. Valerie observes, โAI and data analytics have already been impeded in sports and entertainment. I see a rise in AI twins for celebrities from voice to the whole persona avatars. I also want to believe that we will see a big spike in the popularity of professional women’s sports events and leagues.โ The rebound of international tourism amid geopolitical and economic uncertainties, coupled with post-pandemic travel desire, will likely benefit the hospitality and travel sectors. The rapid advancement of electric vehicles and renewable energy continues, potentially reshaping greentech and smart city initiatives. โElectric vehicles and even more, self-driving cars, are my personal favorites and with AI and security/ collision prevention tech we should finally gain full government support for a wider adoption,โ GP at Yellow Rocks notes. Moreover, the growing trend towards health and longevity is poised to drive health tech and agetech innovations. The persistence of remote work and the rise of digital nomad visas suggest growth in remote work tools, hospitality, travel, and proptech. Technologies enhancing remote employee engagement and collaboration are expected to gain traction. โRemote and hybrid work is here to stay and I see a strong tide of tech tools and innovations to support our new reality. With more freedom from offices, we see growing investments in self-care, mental health, and raising children including homeschooling and new AI education together with re-skilling tools for children and adults,โ Valerie adds.Will 2024 be a good year for Venture Capital?
Jahn Karsybaev anticipates a challenging phase before improvement sets in. โIt will be worse before it will get better. We are projecting that 2024 will be the year of stabilization and growth in 2025. When it comes to fundraising for the Funds, we are also projecting to be a tough year as capital allocators are being a lot more stringent and less risk averse when it comes to investing. Cost of capital is more expensive and a lot of companies are going through transformative phases as sales are becoming much more challenging to grow all across different sectors.โ Kelsey Aina foresees a slower pace in 2024 but remains optimistic about a recovery in 2025. โThe investing climate will be stricter, with fewer unicorns due to market volatility and upcoming U.S. elections. Seed-stage startups may find it harder to progress to Series A in this selective environment, though opportunities still exist.โ Valerie predicts cautious investor behavior due to upcoming elections in the U.S. and other crucial countries. โWith the elections coming not only in the US but in several major critical countries I predict investors will be more cautious about waiting for the outcomes and being more frugal of high stakes late stage investing. However, more and more VCs are moving down the line to allocate to early-stage critical technologies that will dramatically change our lives in the next few years.โFinal Thougths
As 2024 approaches, the spotlight is on AI development and the growth of sectors like agtech, proptech, and healthtech. While it may not be the peak year for fundraising, the emphasis is shifting towards quality over quantity, signaling a significant reset in the venture capital landscape.Enjoyed this article? Sign up for our newsletter to receive regular insights and stay connected.