Are Low-code Or No-code Startups Still Grabbing The Attention Of Investors?

By Author: Chulani De Silva
Total Articles: 37
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We refer to businesses or products that are created utilizing no-code tools as "no-code startups" because not a single line of code has been used in their creation. The main characteristics of no-code startups are much faster to market and reduced building costs. Marketers and analysts have been the main users of no-code and low-code (NCLC) development suites up until now. However, the tide is turning, and these suites are more frequently being used in security and DevOps. Fads in startups are also nothing new. We are currently experiencing somewhat of a SaaS boom as startup funding is shifting toward corporate software. The smaller trend of no-code and low-code businesses, which has attracted investors' attention and increased the amount of startup funding received by entrepreneurs, is present within the current SaaS boom.

The hard-earned programming talents of individual programmers may soon become mostly outdated, but on the other hand, the entire programming process may start to resemble a piece of cake, allowing programmers to produce more digital products in a shorter amount of time. Why is that?

NCLC tools ...
... are changing the software development sector rapidly. A no-code software startup like Webflow, for instance, had a market value of $2 billion after raising $140 million in Series B funding (https://techcrunch.com/2021/01/13/webflow-raises-140m-pushing-its-valuation-to-2-1-billion/ ). Bubble, a different no-code platform, received $100 million in Series A funding and provided business services worth more than $1 billion. (https://www.finsmes.com/2021/07/bubble-raises-100m-in-series-a-funding.html). All of this points to a significant interest in NCLC development approaches that reduce the time and resources needed to build new apps.

Harvard Business Review claims that low-code/no-code platforms have progressed from simply facilitating function-specific tools to enabling a wider variety of business personnel to genuinely own their automation and construct new software applications without coding while enhancing organizational capacity (https://hbr.org/2021/06/when-low-code-no-code-development-works-and-when-it-doesnt ). However, there are various causes for the rise of no-code and low-code technologies, but the main one is a significant discrepancy between the market's lack of competent developers and the continuously rising demand for software development services.

“I don’t think we could have predicted what was going to happen. But in 2019 no code started to inflect.”
-Joff Walters, Business owner at SolarRun-

Thus, there arises the question, are low-code or no-code startups still grabbing the attention of the investors?

It is estimated that no-code or low-code startups will dominate the industry this year. A recent Forbes article listed the top technologies and trends that 16 members of the Forbes Technology Council believe will rule the tech and business industries in 2022. No-code and Low-code were one of the first choices. (https://www.forbes.com/sites/forbestechcouncil/2021/10/14/the-rise-of-no-code-and-low-code-solutions-will-your-cto-become-obsolete/?sh=3bed5cfe4aaf).

As the citizen developer movement expands, corporate technology is becoming more and more accessible, enabling small, medium, and large businesses to digitize. Low-code enables overworked IT departments to refocus their attention on more crucial business-related duties. Customer satisfaction will rise, as will innovation, as a result of the change.

For many years, there has been a trend away from complex coding in favor of user-friendly graphic tools. But as no-code and low-code platforms have advanced throughout time, non-developers may now create more potent websites and applications without having to hire software experts. Additionally, a growing number of people are joining the NCLC movement as they recognize the benefits of process automation, MVP creation, and productivity enhancement.

Business technologists are also more open to automating their procedures and business applications. By 2022, the adoption of low-code will be primarily driven by this so-called hyper-automation, which is defined as the use of cutting-edge technology, including AI, for process automation. Overall, Gartner Inc. forecasted that by the end of 2021, the majority of businesses would be using various low-code solutions in some capacity (https://www.2dr.io/post/the-low-code-and-no-code-market-just-won-t-stop-growing).

Furthermore, Gartner forecasts that by 2024, Low-Code will account for more than 65 percent of all application development activity. One of the causes is that Covid-19 enhanced the pressure on businesses to digitally transition, which boosted the demand for quicker software development and customized solutions.

A recent survey conducted by TechRepublic was able to show that startups are willing to use and continue to embrace the NCLC platforms. Results depicted that 20 percent of businesses want to use NCLC platforms within the next 12 months, and 47 percent of businesses already do so (https://www.techrepublic.com/article/survey-low-code-and-no-code-platform-usage-increases/ ).

Furthermore, it was noted that numerous VCs included no- and low-code startups in their fundamental investing tenets and that these same investors appear to be stepping up their investments in start-up businesses that adhere to the ethos. https://techcrunch.com/2020/09/05/how-one-vc-firm-wound-up-with-no-code-startups-as-part-of-its-investing-thesis/

The majority of VCs follow the artists and repertoire (A&R) model employed by record labels, which look for the one band or artist that will seal the deal with the label. Similar to this, VCs are searching for one or two gold nuggets, such as Dropbox or YouTube, that will significantly increase their initial investment. However, entrepreneurs may now reach the market much more quickly and inexpensively thanks to the lack of coding. Thus, no-code or low-code startups will continue to grab the attention of investors.

Thus, it can be said that the market is expanding and that there is a raising need for software solutions. This trend is also being noticed by business angels and venture capitalists, who are increasingly investing in this sector. For example, with the addition of Steadfast Capital Management, Insight Partners, and Redpoint, Pipefy has raised around 137 million US dollars. Pipefy is a business that specializes in low-code workflow management and can automate a wide range of procedures, including IT support requests, purchasing, and staff onboarding.

In conclusion, the NCLC movement is increasing and expanding. Numerous businesses have already integrated no- and low-code tools and will do so in the near future as the market is predicted to expand. No-code offers additional creative freedom in addition to the obvious cost and time savings while speeding up commercial and entrepreneurial outputs. All of this, along with increased VC investment, suggests that the no-code ecosystem has a very promising future. There is, therefore, no end to it, which could be considered a positive thing.