Bure Valley Group is an investment introducer platform which links successful investors with exciting, innovative UK startups seeking funding. This content is for information purposes only and should not be taken as financial or investment advice.
In 2021, it’s hard to remember a time without The Cloud. Even before the COVID-19 pandemic accelerated the pace of home/remote working, offices and freelance workers have been moving more to cloud-based software to complete tasks (e.g. Google Docs). Popular mobile apps like Dropbox and Amazon Cloud Player base the data infrastructure on the cloud. It is everywhere, and growing more each year as the cloud permeates to new industries and spheres of life. The rise of middle classes in Asia and other parts of the world also beckon a coming era where it will be hard to function in society without a connection to the cloud.
Given the huge growth prospects and innovations in front of us, how can investors identify those companies leading the way in this exciting sphere – holding out exciting opportunities to make good returns? Below, our investment team at Bure Valley Group offers some reflections and insights on this question.
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Defining cloud computing
Cloud computing, in broad terms, involves delivering a range of solutions via the internet. One popular solution, for instance, is data storage. In the 1990s and early 2000s, companies needed to use local – even in-office – computers to store essential data such as customer information. This could be very expensive to build and maintain. With cloud computing, however, a business can use a cloud solution such as Google Sheets to store important sales data. All that it needed is a Google account and possibly a paid subscription – no costly local hardware infrastructure.
There are different forms of cloud computing – such as public and private. The former refers to platforms which provide services to consumers for a fee, via the internet. The latter, however, restrict services to a specific group of users (useful for sensitive data and applications), which can be accessed using a VPN (virtual private network) on the web. Large organisations might even use a hybrid system combining these two approaches, allowing them to engage in the flexibility offered by the public cloud whilst exerting control over areas of the business which need greater security.
Ways to invest in cloud computing
Cloud solutions are offered by companies. Investing in them, therefore, means finding promising businesses which show promise of offering an investment return. For an angel investor, this will involve identifying new entrants to this exciting marketplace and discerning those which hold out the best prospects for rapid growth and success. Here at Bure Valley Group, we offer a network of exclusive projects like these which we’d love to introduce you to.
Regardless, to effectively invest in cloud computing, it is crucial to grasp the different categories of cloud computing and how these can affect your investment choices. These include:
- IaaS (infrastructure as a service). This type of cloud computing is geared specifically towards businesses. It provides the storage, computing, networking, and security solutions needed for the organisation to operate effectively. Examples of IaaS firms include Amazon, Microsoft, Google, IBM, and VMware.
- SaaS (software as a service). A SaaS cloud solution offers a ready-made app to enable a wide range of consumer/business tasks. Netflix and Spotify are common examples. It’s worth noting that these applications are, themselves, built upon IaaS and PaaS. For the investor, therefore, it will be important to check the underlying foundation upon which a SaaS solution is built before providing funding to a SaaS startup opportunity.
- PaaS (platform as a service). Here, the cloud computing service is aimed more at people who build, manage, and deploy their own software. This PaaS service is often built onto an IaaS service, included within a large suite of software. Google is a good case in point. Here, the Google Workspace suite includes a range of tools that can be used to base a business’s infrastructure (e.g. Google Drive). Yet not too far away is Google Developers, which allows developers to access documentation and APIs to build their own tools.
For startup investors, the most common opportunities coming your way are likely to fall into the SaaS category (e.g. a new CRM solution). IaaS and PaaS solutions tend to be the purview of larger businesses which have the staff, resources and market reach to offer the multiple tools and apps involved in a software suite. To invest in companies such as these, you can, of course, invest via dedicated tech funds. Alternatively, you can do research into individual companies – perhaps leveraging a network such as Bure Valley Group’s – to find specific cases where you are satisfied that there is high growth potential. Regardless of the approach you take, it is crucial to diversify your assets appropriately in line with your investment horizon, financial goal and appetite for investment risk. Consider seeking professional financial advice before making any big decisions that involve committing large sums of capital, which may be at risk.
Conclusion & invitation
Interested in finding out more about the exciting startup projects we have on offer to investors here at Bure Valley Group? Get in touch today to start a conversation with our team and discuss some of the great investment memorandums we have available here:
+44 160 334 0827