Urban Tech Trends in 2017
By: Nick Plante
Tags: Self Driving Cars, Autonomous Cars, Startup, Smart Cities

A few weeks ago we unveiled the latest eight companies that are part of our URBAN-X smart cities accelerator in Brooklyn. This is the second time we’ve run this program, which differs a little from SOSV’s other ecosystem accelerators, in that the space isn’t constrained by the deep intricacies of a vertical (manufacturing, biotechnology, etc) as much as by environment and mission. The kind of companies we’re interested in working with through this program are changing the way that humans live in cities: they’re working on topics as various as mobility, urban health and safety, energy, waste, water, city planning, construction, and beyond.

We see hundreds of applicants to our program, and interface with hundreds more through our network, mentors, and co-investors. Here are some of the trends we’ve seen ticking up over the last 12 months or so:

Logistics and the Last Mile

Aerial drone delivery companies like Flirtey (flying pizza delivery anyone?) and Matternet are taking to the skies, while Starship and Dispatch are developing ground-based delivery solutions that promise to bring unattended delivery to our homes and offices. We’re fascinated by this space but we also believe there are several extremely practical opportunities that can baby-step us towards autonomy by augmenting existing human workers, rather than replacing them outright.

One example of a company in this space is our portfolio company Upcycles. They’re developing human-electric hybrid delivery cargo bicycles. While we’re making great progress as an industry towards solving the last mile problem, the last-100-meters problem remains a daunting one: that set of stairs, that locked door, those special delivery instructions. Upcycles combines unique bikes and containers with human delivery worker expertise to navigate these obstacles, but imagines a world where our vehicles evolve to reduce the human effort and elevate the service worker to the role of an overseer.

Upgrading the Built World

We’re already seeing massive shifts in the way that buildings are constructed and utilized. There’s more to come. While WeLive, Common, and their peers are rethinking the way we use shared spaces, startups like Kasita are reimagining what it means to design and buy a home. Construction robotics is particularly interesting right now. Soon we’ll see buildings constructed entirely by robots. Perhaps they’ll be 3d printed on location, or maybe they’ll be built by intelligent robots through semi-conventional means. We expect to see more and more startups that treat the built world as a canvas.

While we wait for the next generation of homes and offices to be built, there are a host of retrofit improvements that we can make to existing buildings to make them more efficient and energy-friendly. Recent advances in Solar and battery tech are a big piece of the equation here, as are HVAC system improvements like BuildSense, which works with existing building management systems to determine accurate room occupancy numbers for energy and airflow adjustments. Another example is our portfolio company nello, which has developed an upgrade solution that transforms legacy building intercom systems into smart locks to help friends and workers access apartments and deliver packages securely with flexible customer rules.

The Autonomous City

We’re in the middle of a massive IoT growth spurt: analysts predict that more than 100 billion devices will be connected to the Internet by 2025, thanks largely to the falling cost of sensors and ubiquitously cheap and widely available computing power. Those same cheap compute cycles, combined with big structured data sets and quality opensource frameworks (leveraging some recent algorithmic advances) are what’s led to the recent advances in Artificial Intelligence and Machine Learning. Every piece of technology requires a posterchild application, and autonomous vehicles have driven an incredibly large number of eyeballs to AI and ML (including some very high profile acquisitions).

As excited as we are about moving people from place to place, we believe that Transportation-as-a-Service is just one of dozens of areas of city life that will be affected by AI-borne automation. What does a completely automated city look like? Can we use data collected by smart sensors (such as Numina) to turn the city itself into an actuator network, triggering next generation city service on demand? Think waste collection, code enforcement, traffic congestion mitigation, in addition to (of course) adaptive advertising… Consider Amazon’s experiments with cashier-free Go stores and the other changes that are coming to retail, or Eatsa’s automated fast food restaurants (it’s good). Or the sewer robots that will patrol our future sewers, monitoring urban health problems so we can live healthier lives… There are precious few facets of life that AI won’t have an effect on over the next decade. And likewise, few jobs that won’t be affected.

Thinking Further Afield

Some of the most interesting opportunities we see will take advantage of second order effects. Take, for example, the inevitable changes that autonomous vehicles will bring about. How will roads and public spaces transform when personal cars are all but eliminated from our cities? How will parking spaces be repurposed? What does cheap, plentiful, and efficient vehicular automation mean for public transportation en masse? What happens to fuel stations? How will our cities and roads be maintained without the same level of taxes and fines? How will alternative mobility (bikes, boards, etc) evolve? And what does this mean for the service economy? Some of the most interesting startups we’ve seen are already working on answers to these questions, and the best among them are finding ways to be immediately relevant.

Finally, I think it’s important to mention that we’re seeing an increasing number of fascinating startups operating outside of North America and Western Europe. I firmly believe that some of the biggest and most important advances in smart cities technology will come from the developing world, in places that aren’t traditional startup hubs, where the regulatory environment is friendlier to city-scale innovation and some of the problems that are annoyances to us here in New York are far, far more problematic. Whether the problem is traffic and congestion, ocean farming, or long-range medicine delivery, we look forward to seeing more founders in Jakarta, Lagos, Karachi, Riyadh, and beyond stepping up to shape the future of our cities. After all, these are the megacities of tomorrow.