2016 predictions

By Rieva Lesonsky

None of us really knows what lies ahead for small businesses and entrepreneurs in 2016. Of course we all wish we did. Having some foresight into the New Year would help us plan, strategize and act with more confidence and less risk.

That’s not to say we have to start 2016 blind. To better prepare you for what’s to come, I asked some of the most knowledgeable small business experts and thought leaders I know to share their 2016 predictions with you.

My 2016 predictions: The coming year will be a pivotal one for entrepreneurs. But success is not going to jump into your laps. You must be proactive and embrace new technologies, ideas and business models. Entrepreneurs who are innovative, bold and gutsy will win the day. After all, as General George Patton once said, “Opportunities do not come to those who wait. They are captured by those who attack.”

2016 Predictions: Data Analytics

Arijit Sengupta, CEO, BeyondCore

Big data and business intelligence/analytics have become the hottest topics in small business operations, emerging as yet another great equalizer that can level the playing field between the bellwether behemoths and upstart entrepreneurs. Thanks to ever-widening access to incredibly powerful, yet easy to use, technology, even the smallest businesses can leverage advanced analytics to refine their sales and marketing with laser-like precision, optimize inventory and distribution, and improve overall operations in ways they never dreamed possible.

As we head into the New Year, I expect 2016 to be the Year of Machine-Augmented Analytics, with five key trends emerging to give small businesses a leg up on their competition. Machine Learning technologies give a magic answer that even experts often can’t fully understand. Machine-Augmentation technologies like Smart Pattern Discovery focus on explaining the key insights in a manner anyone can understand. They enable people to easily overlay their domain knowledge and experience on top of extremely powerful automated analytics—leveraging both people and processors to solve analytics problems.

  1. Human Bias Elimination. Data-driven decisions are only as good as the underlying hypotheses. But when those hypotheses are formulated by people, they’re limited and potentially loaded with bias. People must know which questions to ask, and those questions are influenced by our presumptions, selections and expectations. In 2016, we’ll see a strong shift from presumptive analytics toward smart pattern discovery and machine learning that objectively asks every question, eliminating bias at this fundamental level.
  2. Automated Validation. Making decisions based on invalid conclusions from inaccurate analysis can lead to disastrous consequences. That’s why distinguishing real insights from false patterns requires advanced statistical skills to validate that the answers you get actually make sense. But given the massive shortage in data scientists with these skills, companies must find solutions that provide automated statistical validation. This year, we’ll see increased demand for these products to help bring clarity to analyses, confirm the soundness of visually misleading patterns and bridge the talent gap.
  3. Inherent Data Privacy. On the surface, privacy and security concerns are nothing new, but a recent ruling by the European Court of Justice has created dramatic business implications for the way U.S. companies handle and analyze data, drawing attention to U.S. privacy laws that many believe are inadequate. As a result, expect to see analytics solutions that conduct analyses by leveraging the cheap computing power of the cloud—but without storing any raw data in the cloud—emerge as winners and gain market traction, as companies look to solutions that reduce their regulatory burden by eliminating the risk of privacy breaches from the start.
  4. Actionable Analytics. Most conventional analytics tools look back at the data and tell you what happened. But the true value of analytics lies in telling you what you should do as a result and explaining why you should take the recommended actions. Prescriptive analytics—recommending actions based on smart pattern discovery—will become more mainstream as companies seek out tools that give them insights to enact change, drive optimization and maximize ROI, instead of just providing a pretty picture of what happened.
  5. Truly Dynamic Dashboards. Conventional data visualization tools give us visual answers to the questions we ask, much like the dashboard in your car answers basic questions about your speed, fuel level, etc. But these merely depict the same static set of information—only the numbers change. What if the answers we really need today are not surfaced by those static questions? This year, we expect truly dynamic dashboards to become the new visualization standard, giving us the real-time answers we need to questions we may not have even thought to ask. Unlike static dashboards, like your car’s speedometer, fuel and temperature gauges, truly dynamic dashboards automatically populate with the most relevant charts and graphs depicting up-to-the-minute changes as they emerge, providing the most relevant insights for that specific moment in time.


Jack Bienko, Director for Entrepreneurship Education, Small Business Administration (SBA)

Entrepreneurs continue to lead us toward a “smaller world” where innovation is directly related to client benefits and societal gains. This continues to inspire me as we address serious issues and seek to leverage solutions from all sectors.


Klaus-Michael Vogelberg, Group Chief Technology Officer, Sage

With the million-and-one things small business owners have to do, social media often [is lower on] the list of priorities. But there are a number of interesting ways you can use social media in your own organization.

For example, you could have a social network-style conversation about a problem such as an unpaid invoice, if it was connected to your accounting or business management system. Or you could allow different interactions and business processes to be performed by frontline users. For example, the filing and reconciliation of expenses wouldn’t be done by the accounting department, but actually by the person themselves, collaboratively.

Businesses can use social media as a way of managing and selling goods, which means the need for integration into their business processes. Why not send an invoice via Facebook? At a more basic level, small businesses can make things easier for themselves with software specially adapted to keep track and update conversation. It’s becoming more important—a stray Facebook or Twitter message can cause major damage in a social world.

Gini Dietrich, CEO of Arment Dietrich and author of Spin Sucks

It’s no surprise that everyone is inundated with content and exhausted with the options…most of them not good. Because of that, I predict 2016 will be the year the content marketing cream rises to the top and the weak will disappear. Small businesses will have to get more creative in their content—more video, more visuals, more behind-the-scenes access. Content is not something you do just because everyone else is doing it, but because it is driving sales for you. You will figure out who the influencers are in your industry…and build relationships with them to help you build an external ambassador program. And you’ll work hard to track content against real results, or you’ll just stop doing it.

Brad Jefferson, CEO and founder, Animoto

Over the last year, video content marketing has dramatically increased for large brands as well as SMBs. For 2016, this increase in video marketing is driving big changes in how video is created and distributed—from brands adopting DIY video content to Facebook’s new role as a top platform for video viewership.

  • Video will become essential for every content marketer. In 2015, content marketing was the skill every marketer needed to be familiar with, along with mobile marketing and lead generation. In 2016, marketers will need to add video marketing to their skill set in order to be competitive to future employees and clients.
  • SMBs will follow big brands and begin video content marketing. Big brands have always been at the forefront of adopting marketing trends, such as video, but in 2015, we began to see smaller brands marketing themselves with video. In 2016, we’ll see even more small businesses following suit in an unprecedented way.
  • DIY video marketing will rise. By 2017, video is expected to account for 80 percent of all Internet traffic. However, the high cost of traditional video outsourcing and production will be prohibitive for brands and businesses to keep up with the demand for video content. Luckily, there are also more video creation tools available than ever. We’ll start to see small businesses and marketing professionals alike engaging in more DIY video marketing.
  • By the end of 2016, Facebook will have 20 billion video views a day. In 2015, Facebook saw over 8 billion video views on their platform every day. With the increased proliferation of video on Facebook, in 2016 it will become even more important for businesses to incorporate it into their marketing strategies.


David Smith, Vice President of Worldwide SMB, Microsoft

The number of devices needed to do business will continue to decrease: Last year, Microsoft predicted that we would go even deeper with mobile apps and payments in 2015. Heading into 2016, mobile capabilities will become more powerful than ever, and new apps, including Skype for Business, OneNote and Continuum, which turns your phone into a big-screen projector and a big-time productivity tool, will allow SMBs to run an increasing amount of their business processes on a single mobile device.

Hunter Hoffmann, Head of U.S. Communications, Hiscox

Make sure your website is user-friendly for those on smartphones or tablets, and start, or strengthen, your presence on social media. Now more than ever, people are always on the go. Don’t assume they’ll be on a computer when browsing the Internet.

Jack Bienko, Director for Entrepreneurship Education, Small Business Administration (SBA)

“Mobile everything” continues to grow—mobile device usage and related tools, mobile labor force to recruit and access new talent, mobile services that reach customers with specialized services, mobile marketing to presents immediate localized deals, mobile education that presents engaging content to a huge market of life long learners—did I mention “mobile” yet?


Jared Hecht, CEO and cofounder, Fundera

2016 is going to be all about small business lending transforming into a buyer’s market. With so many online lenders out there, and more information than ever, small business owners will have more power to shop for better rates and have a real understanding of what’s available to them.

Eyal Shinar, CEO, Fundbox

2016 will be the year where big banks and fintech startups start creating partnerships and offer more solutions to SMBs. We will see the two working with each other rather than against each other.

Cindy Yang, Small Business Expert, NerdWallet

  • Entrepreneurs will go online more for small business loans. Online small business loans account for 2 percent of all such loans today. That number is expected to rise to 16 percent by 2020.
  • SBA loan amounts will continue to increase: The average SBA loan size increased 82 percent from 2007 to 2015. The SBA 7(a) program, the organization’s most popular loan, reached an all-time high in the 2015 fiscal year, with 63,000 loans totaling $23.6 billion.
  • Small business owners will use more business credit cards: The total number of business credit cards in use from the top three issuers—JPMorgan Chase, Bank of America and Capital One—grew from 9.9 million to 10.1 million between 2010 and 2015.


Hunter Hoffmann, Head of U.S. Communications, Hiscox

  • Recharge and relax: Just because you’re in charge of a business doesn’t mean you can’t have a work/life balance, too. Hiscox found that 20 percent of U.S. small business owners currently take zero vacation days. Take time away from the office to relieve stress so that you can be an even better boss and work smarter, not harder, when you return.
  • Stay in the know:Commit to quarterly training sessions, workshops and conferences related to your business, and hold yourself accountable for your professional growth. Most large companies offer professional development opportunities for their employees, but as a small business owner, you’re in charge of your own learning and growth. When it comes to training in the year ahead, 43 percent of small business owners believe subsidized training courses and professional development would play an important role in encouraging small business growth.

Retail and Ecommerce

Mike Kwatinetz, Founding General Partner, Azure Capital

Today’s newer type of ecommerce company is more about curation—being a source for items the shopper has not [decided to buy] and curating products so the target demographic is delighted when shopping. The key here is the ability to provide options that the user will be happy with and to almost emulate [the experience of] shopping in their favorite boutiques. The degree [to which a company] is able to personalize the shopping experience impacts how well the customer is delighted with what they are offered.

A second trend is the concept of multi- or omnichannel. Most existing stores and brands are finding it necessary to offer an online shopping experience to go with their in-store distribution. Many online merchants–especially those creating a strong brand–are seeing that adding physical stores or some other means into their distribution enlarges their market and accelerates the building of their brand. This is hard to do before reaching some size, but once a startup does it can also drive people to the physical stores, and each channel reinforces the others.



  1. Loose boundaries between malware and adware

The next year will see a major shift in the way cybercriminals do business. One area that will most likely suffer a major makeover is the PUA (potentially unwanted application or aggressive adware) space, which already has seen increased activity on platforms like Mac OS X and Android.

An increase in arrests and takedowns in 2015 will likely drive new cybercriminals to monetization mechanisms specific to aggressive adware rather than to developing new strains of malware. Currently operational botnets will still be a significant part of the cyber-crime ecosystem, but we will witness an increase in the sophistication of potentially unwanted applications and installers bundling greyware.

Web-based advertising will also suffer a dramatic makeover. As users increasingly adopt ad-blocking technologies, ad delivery mechanisms will become more aggressive in seeking to exploit or circumvent ad blockers.

  1. APTs will drop the persistence factor

Businesses and government institutions will still face advanced attacks throughout 2016. However, advanced persistent threats (APTs) will emphasize obfuscation and information harvesting more than persistence. Attackers will be in and out of an organization in days, maybe even hours.

“The business environment will see an increase of targeted attacks and strongly obfuscated bots, with a short lifespan and frequent updates,” estimates Dragoș Gavriluț, team leader in the Bitdefender antimalware labs. “Most of these attacks will specialize in information theft.”

APTs are not the only threats businesses will face in 2016. Lateral movement in the infrastructure of cloud service providers will also increase with the advent of tools that allow hackers to compromise the hypervisor from a virtual instance and jump to a different virtual machine. This scenario is particularly dangerous in “bad neighborhood” environments where an ill-intended party could get to share a physical system with a legitimate service provider or business.

  1. Mobile malware catching up in sophistication

On the consumer side, Android malware is rapidly copying developments on the Windows platform. While rootkits are on a downward spiral on Windows, they will likely become standard fare on Android and iOS, as both platforms are becoming increasingly complex and feature a large attack surface, says Sorin Dudea, head of Bitdefender’s antimalware research team. New mobile malware with wormable features, or a massive mobile botnet, are two other possibilities next year, according to Viorel Canja, Head of the Antimalware and Antispam Labs at Bitdefender. These attacks might be driven by social engineering or by the exploitation of major vulnerabilities (such as Stagefright) on unpatched platforms.

  1. IOT and privacy

The way we tackle privacy will also change throughout 2016. Recent data breaches have contributed to the pool of “big leaked data” available freely on the Internet, which makes “doxing” (the process of compiling and aggregating digital information about individuals and their physical identities) much easier for third parties.

Internet of Things devices will become increasingly popular, and thus appealing to cyber-criminals. Their short development lifecycle and limits on processing or battery power leave gaping holes in their security, and most IoT devices directly facing the Internet will be compromised in 2016, says Bogdan Dumitru, Chief Technology Officer at Bitdefender. The Big Brother regulations that more and more countries are trying to pass to stop terrorism will unleash battles for data sovereignty and crypto control.

  1. Ransomware becomes multi-platform

Ransomware has probably been the largest unresolvable threat to Internet users since 2014, and it will remain one of the most important drivers of cybercrime in 2016. While some operators will prefer the file encryption approach, some more innovative groups will focus on developing “extortionware” (malware that blocks accounts on various online services or that expose data stored locally to everybody on the Internet).

Linux ransomware will become more refined and might leverage known vulnerabilities in the operating system’s kernel to get deeper into the filesystem. Botnets to bruteforce login credentials for content management systems might also become larger in 2016. These credentials could be then used by Linux ransomware operators to automate encryption of a significant part of the Internet.

Throughout 2016, file-encrypting ransomware will most likely expand to Mac OS X as well, as proof of concept threats such as Mabouia will be commercially ported.

Klaus-Michael Vogelberg, Group Chief Technology Officer, Sage

It’s not just huge enterprises that are targets [of cybercrime]—any online business is a potential victim. But small businesses often lack the resources to defend themselves against attack. It could destroy their reputation and cripple them financially.

New security software for a small business needs to be simple and easy to use—even better if it can make use of crowdsourced analytics to spot suspicious patterns and outbreaks. Small business owners need to be educated in the best ways to use existing technology to combat an ever-increasing threat.

Sage, as well as other reputable tech companies, is investing considerable effort and resources in creating a secure environment that protects the assets of customers. We’ve got a Secure by Design strategy where software is designed from the ground up to be as secure as possible, rather than just protected at the operational level and network perimeter.

Hunter Hoffmann, Head of U.S. Communications, Hiscox

Check your safety net: Ensure that you are completely insured against any possible threats—22 percent of small business owners cited hacking and cybercrime as a major risk to their business, yet only 7 percent have e-risks insurance.



Based on design contests launched on 99Designs, we predict the top categories of new businesses that will be launched in 2016:

  • Marijuana/Cannabis: Related services of all kinds are surging on 99designs, with everyone hoping to ride the legalization train to riches.
  • Beer, Microbreweries & Wineries: It appears consumers are taking the edge off, and entrepreneurs are taking note. Microbreweries and wineries are two of the hottest categories for new logo designs.
  • On-Demand Delivery Services and Subscription Boxes:Who doesn’t prefer at-home delivery these days? More and more on-demand services and subscription offerings are popping up to cater to a market that prefers to hit the purchase button instead of hitting the gas to the nearest store.


Jeff Crouse, Vice President, Pitney Bowes Global SMB Solutions

In 2016, small and medium businesses (SMBs) will face an uphill challenge to manage their shipping and mailing due to higher shipping volumes, rising costs and increasing complexity—ranging from multiple carriers and rate structures, to real-time tracking and new compliance requirements. Simplifying the sending process will become even more critical in 2016 as postal and courier rates rise and more SMBs go global through ecommerce. Despite the growing complexity and importance of sending, many businesses still default to inefficient and outdated processes and tools for their parcels, flats and mail. The good news for SMBs is new technology and cloud-based solutions are becoming available to integrate physical and digital experiences and simplify processes on one platform. These new solutions will help businesses simplify their sending without requiring a Ph.D. in shipping and mailing.

David Smith, Vice President of Worldwide SMB, Microsoft

Personal assistants will get more personal: As Lili Cheng mentioned in the predictions blog, in 2016 our conversations will increasingly be mediated by conversation assistants who will help us be more productive. For SMBs, this means tools like Cortana, available on all Windows 10-enabled devices, will continue to become more predictive in bringing significant productivity benefits to business owners.

Klaus-Michael Vogelberg, Group Chief Technology Officer, Sage

There are core areas of information technology that could benefit from simplification. Virtualization is one. It’s a great solution, but can be expensive, messy and complicated to get started. Software containers are an innovative alternative that allows apps to be created in a self-contained virtual environment, and multiple apps run on the same server simultaneously. It’s revolutionizing the industry through scalable application deployment.

Docker is one such technology. Since 2013, Docker has been taken up quickly in startups and small businesses. Originally Linux-based, it now has versions compatible with both Windows and Mac. It’s great for a technology-based startup to begin creating new apps.

Russ Fujioka, U.S. President at Xero

  • The power of the cloud will be realized. Applications will be designed for the cloud before traditional data centers—and in 2016, companies will use more computing power from the cloud than from their servers. The cloud, which blurs national and state barriers, will open up global opportunities never before available to small businesses and become a baseline for success and productivity
  • The cost of technology will fall and break down barriers. Previously, businesses had to pay a lot of money for data and analytics. Automation platforms were tools only big enterprises could afford. However, as the cost of tech falls, so too will the barriers for small businesses. They’ll be able to use analytics to uncover new insights as well as automation platforms that were once only used in the big business world.

Michael Spadaro, CEO of Profound Cloud and Brother Small Business Advisory Panelist

Every year small businesses become increasingly tech savvy. 2015 saw even more change, especially in the devices that businesses are using on a day-to-day basis. Most notably, tablets and smartphones are continuing to gain ground on desktops and laptops as the most vital piece of the small business tech puzzle. The evolution of mobile operating systems, hardware performance and wireless connectivity continue to set us up for a time when these devices, which many consider secondary to desktop workstations today, become the primary devices in small business IT.

Helping this transition is the emergence of more cloud-enabled devices. Today, even printers and scanners can seamlessly integrate with cloud services and platforms, making tablets and smartphones increasingly viable replacements for traditional workstations. I expect to see more of these devices coming to market in 2016 to support the growing number of businesses thinking cloud and mobile-first.


Cindy Yang, Small Business Expert, NerdWallet

Assuming the current growth rate of women-owned businesses continues, more women will become small business owners—43 percent of small businesses will be owned by women in 2016 and 50 percent by 2020. That’s up from 36 percent in 2012. Growing industries for women entrepreneurs include agriculture, forestry, fishing and hunting; accommodation and food services; and manufacturing.


Yaniv Masjedi, Vice President Marketing, Nextiva

Small business owners will become even more invested in employee engagement issues in 2016. The job market is very active right now, which means every employer needs to make a case for why top performers should choose to work at his or her business. Effective employee engagement is the key to retention, and I think we will see increased interest in this realm next year.

David Smith, Vice President Worldwide SMB, Microsoft

We’ll see more young virtual workers: With the BYOD phenomenon alive and well, in 2016 the trend of working remotely will further take hold of the younger generation. In fact, Microsoft predicts that 2016 will be the first year that more people’s first jobs will be virtual rather than in a physical space. Additionally, according to new Microsoft-commissioned research, the younger workforce is placing a high value on collaboration tools, such as Office 365, as the majority of respondents said “good team collaboration” was the No. 1 most valuable attribute in their ideal workplace. For SMBs, this underscores the importance of investing in technology tools to enable the new generation of employees to collaborate no matter where they are working.

Russ Fujioka, U.S. President at Xero

The on-demand economy will change our labor force. The rise of the freelancing workforce has been given new life by a plethora of platforms connecting people with work, be it having someone design a logo for you, deliver ice cream, or clean your house. In 2016, technology will streamline the freelancing marketplace, and the on-demand economy will continue to thrive.