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McKinsey & Company: Startups revenue could reach $30 trillion by 2027

McKinsey & Company has released the State of Startup Global Survey 2022. The global revenue of new businesses, which stands at $5 trillion today, could rise to $30 trillion in 2027. Data from interviews with business leaders representing companies with at least $1 billion in annual revenue reveal a marked shift in perspective over the past three years.

The State of New-Business Building Global Survey, conducted for the third time by management consulting firm McKinsey & Company, has been published. For the research carried out by the Leap by McKinsey team, which serves existing companies as they create and scale new businesses from the ground up, globally; Interviewed business leader representing all regions, industries as well as different company sizes, functional specialties and tenures.  

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Research results show that start-up activities are poised to play an increasing role in the global economy. Despite the uncertainty and volatility in the global economy, starting a new business is among the top five priorities for eight out of 10 CEOs. 63 percent of business leaders predict that new businesses they start will increase their current income by 5 percent. Data obtained from interviews with business leaders representing companies with at least $1 billion in annual revenue also reveal a marked change in perspective on the subject over the past three years.

McKinsey & Company Eastern Europe, Middle East, Africa and Turkey Leap Leader and Senior Partner Can Kendi summarized this shift as follows: “Our 2020 findings reflect that business leaders are beginning to prioritize starting new businesses. In 2021, the strategic value of starting a new business stood out as well as the potential it created for the company’s success. The data we obtained within the framework of our latest research; It shows that markets also understand the value of new business.” 

New jobs will account for 27 percent of total revenues

The latest survey of more than a thousand business leaders in 75 countries globally reveals that companies that make starting a business a top strategic priority are growing faster than other organizations in this year of high economic fluctuation. The interviewed leaders explain that the corporate value of new business revenues has reached nearly double that of core business revenues. Leaders predict that the new businesses they will establish in the next five years will be 27 percent of their total income. McKinsey experts as a result of this situation; He explains that the global income of new businesses, which is 5 trillion dollars today, can reach up to 30 trillion dollars in 2027. 

 

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In the research, in the EEMA region, which includes Turkey; it seems that starting a new business has become even more of a priority for business leaders. The ratio of business leaders, who are among the top three priorities of starting a new business on a global scale, decreased by 10 points compared to last year and reached 46 percent, while the same rate reached 51 percent with an increase of 12 points in the EEMA region. Despite this situation in the top three priorities, three-quarters of business leaders worldwide consider starting a new business among their top five priorities this year, as they did last year.  

“The technology that offers the most value when starting a new business is artificial intelligence”

Considering the answers of the CEOs among the respondents, 83 percent of the respondents counted starting a new business among the top 5 priorities, Can Kendi said, “This increase is also reflected in the number of new companies established. Explaining that they established a new company once a year until two years ago, CEOs state that they have caught the average of three new companies in two years now. According to the results of the survey; Companies globally have invested 5% of their revenues in starting new businesses in the last 12 months. In the EEMA region, although this ratio remains at 3 percent, 55 percent of business leaders plan to increase their investments in this area in the next 12 months. Our analyzes in line with the research results show that in the next five years, business leaders,  

Can Kendi continued his words as follows: “In the next five years, artificial intelligence takes the first place in the list of technologies that will offer the most value in the process of starting a new business. The proportion of business leaders who put artificial intelligence first is 54 percent globally, increasing to 66 percent in the EEMA region. In the answers to this question, artificial intelligence is followed by the internet of things and blockchain technologies. When looking at the new business types to be established in the same period, data and analysis platforms lead the way with 38 percent on a global scale, while digital retail is at the top of the list with 55 percent in the EEMA region.

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