ARK’s Big Ideas for 2021 lists the firm’s ‘most provocative research conclusions for the year’
Those most famous of disruptive innovators, the team at ARK, has published its annual Big Ideas report for 2021, highlighting an extraordinarily broad range of themes detailing the latest developments in innovation and offering what it calls some of their most provocative research conclusions for the year.
First out of the box is Deep Learning, which the team believes could be the most important software breakthrough of our time.
“Until recently, humans programmed all software. Deep learning, a form of artificial intelligence (AI), uses data to write software,” the ARK team writes. “By ‘automating’ the creation of software, deep learning could turbocharge every industry.” The ARK team’s research shows that deep learning will add USD30 trillion to the global equity market capitalisation during the next 15-20 years.
Up next for causing huge change is the Reinvention of the Data Centre, according to ARK, which observes a revolution occurring in the sector. Cheaper, faster, and more power efficient processors are starting to displace Intel—which traditionally had captured over 90 per cent of all processor revenue, the firm says. It believes that ARM, RISC-V, and graphics processing units (GPUs) are likely to emerge as the new powerhouse processors. “Together they could scale at a 45 per cent annual rate to USD19 billion in revenue by 2030. In the data centre, we believe accelerators, dominated by GPUs, will become the dominant processors for new workloads, growing 21 per cent at an annual rate to USD41 billion by 2030.
The next big theme for ARK is Virtual Worlds, consisting of video games, augmented reality and virtual reality. ARK writes: “A virtual world is defined as a computer-simulated environment that can be accessed by anyone at any time.
“Society interacts daily with virtual worlds which today are in their infancy. According to our research, revenue from virtual worlds will compound 17 per cent annually from roughly USD180 billion today to USD390 billion by 2025. Today, virtual worlds are independent from each other, but in the future they could become interoperable, culminating in what futurists have deemed 'The Metaverse.’”
Next up is Digital Wallets, which, ARK says, could represent a USD4.6 trillion opportunity in your pocket, and upend traditional banking.
More overthrowing of the traditional comes in the firm’s predictions and observations on bitcoin - the firm estimates that if all S&P 500 companies were to allocate 1 per cent of their cash to bitcoin, its price would increase by approximately USD40,000.
ARK believes bitcoin’s rapid growth has positioned it for an allocation in investment portfolios. “We believe bitcoin offers one of the most compelling risk-reward profiles among assets. As our analysis suggests, it could scale from roughly USD500 billion to USD1-5 trillion in network capitalisation during the next five to 10 years.”
Electric vehicles are also part of the changing world for ARK which has famously supported Tesla throughout its volatile run. The firm says that electric vehicles are approaching sticker price parity with gas-powered cars.
Robotics and automation come next with ARK commenting that while the robots are coming … they will help to create jobs. Autonomous ride hailing comes next with ARK’s research suggesting that autonomous ride-hailing platforms will generate more than USD1 trillion in profits per year by 2030. In addition, automakers and fleet owners could enjoy profits of USD250 billion and USD70 billion, respectively. ARK’s research on Drone Delivery, another big theme for disruptive innovation according to the firm, finds that drone delivery platforms will generate roughly USD275 billion in delivery revenues, USD50 billion in hardware sales, and USD12 billion in mapping revenue by 2030.
Orbital aerospace comes next with ARK’s prediction that the orbital aerospace opportunity – including satellite connectivity and hypersonic flight – will exceed USD370 billion annually. Back on earth, 3D printing is another potential disruptor, with ARK estimating that 3D printing will revolutionise manufacturing, growing at an annual rate of roughly 60 per cent from USD12 billion last year to USD120 billion in 2025.
Long-Read Sequencing, that could provide a more complete picture of the human genome is also covered in the report, with ARK estimating that long-read revenues will grow 82 per cent at an annual rate, from USD250 million in 2020 to roughly USD5 billion in 2025.
Turning to health care, ARK believes that going forward, Multi-Cancer Screening using liquid biopsies could prevent more cancer deaths that any other medical intervention in history.
According to ARK’s research, the convergence of innovative technologies has pushed the cost of multi-cancer screening down by 20-fold from USD30,000 in 2015 to USD1,500 today and it should drop another 80 per cent+ to USD250 in 2025.
“As a result, the multi-cancer screening market should scale to USD150 billion in the US. A multi-cancer screening protocol could avert 66,000 cancer deaths per year in the US, saving 1.4 million human life years,” the firm says.
Cell and Gene Therapy: Generation 2 is the final outing in the report, with ARK predicting that the second generation of cell and gene therapies could increase the total addressable market for oncology therapeutics by more than 20-fold.