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On-Demand Industry - An Investor's Favorite

Our day-to-day lives present us with new inventions which we accept in our routines so seamlessly that we do not realize how great they are. Same is the instance of on-demand economy. The on-demand economy has provided us with the luxury of having anything and everything with a single click of a button. Be it, cabs, food, beauticians, doctors, any other service possible in daily lives, everything is just one click away.

The on-demand economy has been witnessing miraculous growth since the beginning. But the question is whether this hype is going to go on booming or will it settle down like all other trends. PWC estimates that the on-demand economy will reach a whopping US$335 billion by 2025. So it looks like the on-demand economy is here to stay. And why not? Anything that provides its users with a luxurious ease of door-step services is meant for today’s busy lifestyle.

Apart from every other reason, the most pushing factor, causing the growth of On-demand economy, is the ever changing customer behaviour towards this industry.

Let us now have a look at the major sectors that are disrupting the on-demand economy.

  1. Food - From groceries to cooked food delivery, the food sector is raging high in on-demand app development sector. Providing direct business to restaurants and delivery services, the meal delivery industry is already a trillion-dollar industry as per the first quarter of 2015.
  2. Ground transportation - With the recent news of the supposed acquisition of Uber by Ola in India, it is safe to say how big ground transportation is growing today. Because Uber’s gross revenue in 2016 was $20 billion (businessinsider). Transportation services have become so sophisticated in the recent past that they were never imagined before.
  3. B2B services - From outsourced consulting to temporary staffing, B2B services are making their way in the on-demand economy. This trend is yet to catch up in India, but services like TaskRabbit and HourlyNerd have led to revolution in the countries in the West.
  4. Home/Professional services - We no longer need to flip through yellow pages to find service agency numbers like plumbers, electricians, beauticians etc. We can even hire a team of professionals to manage our events.

As you can see, the possibilities are endless in the on-demand app development industry. With examples in front of us where Uber has managed to raise approximately $10.2 billion, UrbanClap has raised nearly $35 million, and Ola Cabs has raised nearly $1.18 billion after having completed seven stages of funding. Surely, on-demand startups have turned out to be more convenient, more technically updated and highly efficient.

BIA/Kelsey estimated that the on-demand economy would serve just 7% of its $758 billion US addressable market in 2017. Simply put, there's still a lot of room for on-demand app development companies and new startups that provide on-demand services and a wide variety of industries waiting to be disrupted.

With youngsters coming up with new startup ideas, everyone is looking up to the on-demand industry itself. Looking at customer behavior and recent data, investors have also started considering these on-demand start-ups as a big source of attraction as they have the ability to predict the future of each and every trend that results from technological and business integration.