2020/2021: what are the most profitable growth sectors?

The effects of the pandemic are dramatic. Yet, not for everyone...

We are not reinventing the wheel when we say that the Covid-19 pandemic, with its huge economic, financial, social and psychological impact, has unexpectedly interrupted the recovery of the Italian SMEs, began after the 2008 economic crisis.

Nevertheless, according to ISTAT data, the lockdown imposed by the Italian Government in 2020 has caused a strong divergence in the performance of the various sectors: while some have suffered several bankruptcies, others have uncovered real business opportunities

Faced with the global crisis, the enterprises reacted differently: at the end of 2020, roughly 30% hadn’t implemented a defense strategy yet. On the other hand, the other 70%  reacted by introducing new products, diversifying sales channels and implementing new work processes, heading towards digitalization and new business models.

Post-Covid Business Trends

The effects of the economy on the GDP have been negative for all world economies, which are still undergoing a recession phase. Although Italy’s GDP has recorded a leap of 3,8% in the third quarter of 2021 compared to the third quarter of 2020, pre-crisis levels still haven’t been reached., Despite the drop, some growth drivers have emerged in 2020/2021 that present great opportunities for investors.

Ecological transition

2020/2021 were not only characterized by the pandemic, but also by various natural disasters that had a great impact on our planet. By 2050, all European countries must ensure climate neutrality by allocating necessary means for renewable resources and energy. Investing in Green Economy, meaning in enterprises that deal with environmental sustainability and sustainable products, proves to be not only an ethical choice, but also a business opportunity

Cloud Computing 

One of the most important consequences of the pandemic regarding the labor market is the acceleration of businesses’ digital transformation. Imposed social distancing and the subsequent implementation of smart working have increased investments in intangible assets like cloud servers, SaaS services and e-commerce.

Cyber Security 

Smart working also brings dangers with it. Since the network becomes decreasingly structured and centralized, firms are already tackling cyber-attacks aimed at breaching confidential data. Findings reveal that in 2021 businesses began to prevent attacks rather than just responding to infiltrations.

FinTech and InsurTech

Technology is ever more present in every aspect of human life, including financial services. Artificial Intelligence and new digital technologies are being rapidly implemented in the traditional financial services, from online banking to digital investment apps. Ernst&Young highlights that one third of consumers worldwide now use two or more Fintech services. As a consequence, Fintech is a rapidly expanding sector, favored by the pandemic and by the subsequent exponential growth of technological devices and platforms

Life Science

The health sector and the pharmaceutical industry have made some great strides during the last two years in terms of drug development and re-launch of predictive medicine (greater automation and digitalization of processes). Life sciences enterprises have become a reference point for investors and businesses, particularly for their strong financial position and the immediate return on investment they provide

What about the future?

According to a report of the European Investment Bank (EIB), Europe needs long-term investments in competitive sectors to emerge from the crisis. Judging by the results obtained in 2020/2021 and by the key role played by those issues for the global economy, these sectors are likely to be profitable and safe for capital investments also in the near future

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