INTRODUCTION
Overview of Portugal’s tech growth in 2024
Startup Dynamics in Europe: Exits and Entries in 2023-2024
Technology continues to be a most exciting business sector today, and Information and Communication Technology (ICT) remains the most powerful domain. The truth is that 63% of all startups in Portugal belong to this category. Not only are they shaping the future of the local economy, but these tech-driven companies are also creating ripples internationally. In 2024, revenues from Portuguese startups showed a promising figure of €2.6 billion, €1.5 billion of which came from exports. One of the most astounding elements of this growth is the remarkable export orientation of the sector: a third of startups making 58% of their income from outside the country, a figure that is far above the very generous national average. This export promotion is an example of the increasing competitiveness for and internationalization of innovation made in Portugal.
The thriving startup ecosystem of Portugal will not only bustle with finance but also jobs. By 2024, the employment at the nation would further rise by 26,000 plus job opportunities, meaning almost 19 percent growth compared to the previous year's figures-an already average figure above national averages. They're doing great favor to boosting the entire economy and increasingly inviting the best of talents to chase after them in Portugal. The 72% above the national median salary average of €2000 a month in the technology sector makes Portugal more attractive to startups and professionals looking to advance in their careers.
This growth has also benefited government initiatives such as tax incentives and investments in research and development. Through such initiatives, along with Portugal's access to EU funding, the country provides a very favorable environment for innovation and tech entrepreneurship. Emerging cities like Lisbon and Porto are fast becoming innovation hubs, with a lively network of investors, start-ups, and academic institutions coming together to deliver cutting-edge advances in areas such as artificial intelligence, biotechnology, and sustainability technologies.
It is that Portugal has an exceptional geographical position together with a favorable regulatory framework that can make it an ideal gateway for startups to scale internationally. And this is not just a national phenomenon; by and large, the startup scene in Portugal will be destined for a leading role in the European and, indeed, global tech landscape.
In short, Portugal is quickly carving its niche on the world's map as a hub of technology and entrepreneurial aspiration. All brought together through increasingly numerous startups, impressive export turnover, and an increasingly competitive market for talent, the country has come to stay at the helm of European innovation for years to come. The 2024 horizon is just the starting point into what promises to be an exciting journey through much growth and transformation for Portugal's technology ecosystem.
Top technologies of 2024 and their use cases
Now that we've entered the year 2024, another wave of technological innovations has geared up to change how businesses work and how the world turns from the common course. Most of the new trends announced in the field pertain to AI, cloud computing, blockchain, 5G, quantum computing, and augmented reality.
A peep through the door into some of the greatest technology applications by 2024 across different fields:
1. Artificial Intelligence (AI) and Machine Learning (ML).
These technologies will do much with human-computer interaction; for that, AI and ML are without doubt leading the way in making new developments. Such innovations were not recent but are yet to be witnessed in such environments as better decision-making, enhanced customer experience, and the ability to automate intelligent actions. The key applications are:
◦ Once upon a time, artificial intelligence has remarkably improved the response and detection times of travel against threats and has recently enabled organizations to put up their real-time active counter actions against advanced attacks. In Portugal, for example, Applied Ethical Hacking, by an AI start-up called Ethiack, automates the ethical hacking processes for network vulnerability detection.
◦ AI in Healthcare: Diagnoses now take a different turn because algorithms help analyze medical images, predict patients' outcomes, and speed up the discovery of medicines. An example is the portable glove from the Portuguese start-up Glooma that uses AI for self-breast cancer screening, which would be considered proactive healthcare.
• AI in Business Operations: Such things are being carried out by companies by bringing AI into the routine business processes where repetitive activities can happen and then optimizing the business functions. Neuraspace uses this for satellite protection from space debris, among the major concerns raised today among space agencies and satellite operators, a Portuguese startup is doing the same.
2. Cloud Computing and Edge Computing.
To scale and give flexibility and cost-effectiveness to the businesses, there is increasingly reliance on cloud computing. Along with that comes edge processing, which relates to bringing the data closer to its source. It picks up especially a lot of speed in today's world of IoT.
Cloud based SaaS. All operations of enterprises are shifted to platform- either data storage or collaboration. Take for instance Rauva, a startup based in Portugal; it employs the cloud to yield a “business super-app,” which stores, accesses, and manages financial aspects of business across Europe.
Edge Computing: Reducing latencies in environments where more devices are interconnected; connecting devices and edge processors make it easier and faster to assimilate data and information. An example of an IoT startup in Portugal which is bridging the digital divide using edge computing is Connected.
3. Blockchain Technology.
The blockbuster rise of blockchain continues especially among industries needing safe and completely transparent records. Because of its decentralized structure, it is perfect for its application in finance, health, and supply chain.
Transforming Finance with Blockchain. Transparency and Decrease in Transactions Fraud: A startup in Portugal called Paynest uses blockchain for employees' financial wellness by providing a complete suite of benefits.
Data Protection with Blockchain: Blockchain is being considered as a method for encryption of sensitive data. Another Portuguese startup, Framedrop.ai, introduced a blockchain solution for data privacy in its content analysis services, rendering its AI platform more secure.
4. 5G and Advanced Connectivity.
Central installations have made pledges through the incredible technology to transform industries forever with ultra-high-speed and reliable internet connectivity. This change in connectivity will be associated with next-generation applications like autonomous vehicles, IoT, smart cities, to mention a few.
5G. The future of IoT: being extremely fast and latency-free, 5G will bring disruptive changes into the IoT world. For instance, a Portuguese edtech startup, Miles in the Sky, brings real-time learning to students and professionals through immersive educational environments using 5G.
5G in Healthcare- This 5G technology is the clear successor will take the remote healthcare to the next level of monitoring and telemedicine in real-time. Think much faster and more dependable connections for the improved delivery of care and better patient outcomes.
5. Quantum Computing.
Quantum computing is going through a period of infancy, though it signifies much more beyond future promises. This holds the possibility to address some problems that would otherwise be impossible via any current-day computers. In fact, 2024 brings in an increased amount of investment toward the research of quantum applications related to fields like cryptography and drug development.
Quantum Computing in the Health Sector: Quantum computation may allow faster discovery of drugs and more complex understanding of molecular structures, revolutionizing healthcare. Portuguese firms are investigation how to utilize quantum computing for simulations that can be considered accurate enough for medical research.
6. Augmented and Virtual Reality.
Virtual and augmented realities promise with depth and docking in all business applications from retail and real estate to education. They have completely revolutionized the engagement of people with their products, services, and contents.
AR and VR in Education: They both have made learning alive and interactive at school. Miles in the Sky uses AR and VR to provide rich-experience learning user with options to explore complex topics in fresh, active ways.
AR in Retail: Augmented reality is making e-commerce better by letting people try products before buying them. Reliive has been utilizing this advanced technology to render virtual tours in real estate to enhance the buying experience. It allows clients to access the virtual tour no matter how far they are from the property.
7. Robotic Process Automation (RPA).
RPA continues to simplify business processes by automating most redundant tasks; thus, it saves costs while driving efficiency and devoting attention to more strategic work.
Robotic Process Automation has been implemented in financial services for several tasks ranging from invoice processing to customer service and compliance checks. MyCareforce, a health tech start-up from Portugal, employs RPA to automate workforce schedule and shift management in healthcare.
Automating Production with Robots: Now, robots are used for assembly, packaging, and quality control in factories. This, in turn, brings about an increase in productivity and a reduction in errors. Furthermore, smart factories are expected to facilitate the trend.
All the major technological releases will be related to one another in 2024 and will bring the various industries to innovation. AI, cloud computing, blockchain, 5G, quantum computing, and AR/VR are changing the way businesses work towards transforming the companies, evolving into a new dimension in efficiency, transparency, and agility. These disruptions of pressing nature create a grant future for all countries like Portugal, which has taken or is taking new ventures like Ethiack, Framedrop.ai, and Relive in developing artificial intelligence innovations. The future of business continents will be determined by embracing them all to create new avenues in future growth and development.
Predictions for how these technologies will evolve in 2025
Currently, the course of digital transformation is going at an even faster place than before, which makes possible only the companies and professionals who can stay in touch with new trend developments from the IT fronts. In 2025, some of the technologies related to an AI, advanced computing, and the human-machine nexus will rank as key drivers through which businesses can raise productivity, innovation, and security while converting opportunities into success stories and keeping a competitive edge.
So, what are the key technological trends to shine beyond 2025? Here are some of the most interesting future-throws.
1. AI, Machine Learning, and Generative AI.
According to the estimates concerning market value due to rapid adaptation of such implementations by people, the AI market would likely reach history €708.83 billion by the year 2025 or $747.91 billion.
• With the arrival of the vast language models such as ChatGPT, Google Gemini (previously Google Bard), and Claude, companies of all types are thriving in their productivity, efficiency, and innovation by automating and bettering customer engagement. The generative AI has radically changed industries like software development, business analysis, diagnostics in healthcare, and predictive maintenance in manufacturing. The generative AI market is likely to grow at a whopping CAGR of 46% till 2030 and withstand itself at €337.45 billion (USD 356 billion) making it one of the fastest growing markets across the globe.
• Agentic AI seamlessly combines generative AI with machine learning and autonomously does the task assigned by users, thus becoming an active problem-solver and decision facilitator. By 2025, it is expected that an agentic AI program will carry out pilots at 25% of companies using generative artificial intelligence; that figure will go to about 50% in 2027.
• Companies, particularly in Europe, will have to comply with increasingly tighter regulations on using responsible AI, although these will not and are still lacking solutions for full compliance with key standards, legal, and ethical aspects regarding AI systems applications. AI management platforms will mostly support ethical use, transparency, and safety in AI implementation.
• Owing to enhanced incidents of social engineering attacks and deepfake technologies, companies have been looking for technologies that help detect fraudulent information and messages. There is a sharp increase in the requirement for disinformation detection tools such that in 2028, it is expected that 50% of companies would have adopted products or services aimed at counteracting disinformation, quite contrasting with less than 5% in 2024.
2. Advanced Computing.
Quantum computing has a terrific future and may develop to potentially solve very difficult problems at speeds that classical computers would find inconceivable.
Come 2025, quantum technologies will continue to expand and penetrate various industries from finance to pharmaceuticals and logistics through faster processing of data- solving, for instance, previously intractable problems. Quantum computing will optimize large-scale portfolios and risk management strategies in finance; accelerate drug discovery and precision medicine in healthcare; and optimize inventories, routing, and deliveries in logistics.
With the advent of quantum computing developments, conventional encryption methods will soon be history. The requirement is for the adoption of post-quantum cryptography and secured communications and safe data transmissions. It can be expected that this would finally result in an annual increase of nearly 1.58 billion euros ($1.67 billion) by this year, with the result being approximately 50.05 billion euros ($52.84 billion) in 2037-with a corresponding compound annual growth rate (CAGR) of around 33.1%.
In 2025, hybrid environments will become increasingly popular as organizations certainly will continue to use both old and modern computational technology in complementary fashion. Now, businesses have to co-locate both on-premise servers-with sensitive data protection-only cloud servers for analytics and scalability improvements in the performance, security, and cost.
3. Internet of Things (IoT).
It is expected that the introduction of IoT technology will take place in three aspects:
• Now everyone is using interconnected devices, from everyday appliances, such as smart TVs or vacuum cleaners-even to wearables, from smartwatches to augmented reality headsets, and finally connected cars in the form of self-driving cars or real-time traffic updates.
• Organizations from areas such as agriculture, healthcare, retail, and manufacturing are nowadays supplementing IoT devices with AI and machine learning algorithms to improve operations, inspire new creations, ensure enhanced security, improve the customer experience, and streamline expenses.
• More and more cities are integrating IoT sensors and devices for applications spanning optimizing transportation, energy use, waste management, resource provisioning for water, security, and healthcare.
It is expected that the number of connected devices would increase to a phenomenal number of 21.5 billion by the year 2025 and would shoot up to 40 billion by the year 2030. AI and cloud computing will come together with edge computing in most cases for the handling or managing of cloud-based services with IoT devices that will be generating all of this information. Coupled with this will be the extensive reach that 5G has to ensure global seamless connectivity.
Global IoT market forecast (in billions of connected IoT devices)
4. Digital Resilience and Sustainability.
Sustainability has begun to get integrated into almost every field. More and more, organizations are committed to making 'green' pledges and reductions in carbon footprints-the guilt-laden moody pressures of society and commerce that were once only leveled at individuals and households.
In the next three years, by 2025, organizations will take their digital operations more sustainable through the listed methods:
• Integrated to the business strategy, going forward, will be more sustainable architectures, algorithms, and energy-efficient data centers and hardware, which can reduce overall environmental footprint with maintained performance.
• The investments within the renewable pick pockets like solar, wind and bioenergy will continue to rise in the prospective year 2025. Renewable energy will be converted into 35 percent of the world's electricity above coal, making it the first source for electricity generation.
• The efforts in reducing carbon footprints through increased investments in electric vehicles and smart grids will lead to higher growing sources of energy-efficient consumption models towards greener energy consumption.
• In the future, energy-efficient AI will become the norm as it would utilize smaller LLMs and less resource-intensive models towards sustainability and cost savings.
• Adoption of recycling and reusing materials, waste reduction, and the intended longer life cycles of information technology equipment lead to more sustainable digital operation organizations.
5. Virtual and Augmented Reality.
They are changing the view of both worlds digitally and physically.
In 2025, VR and AR will keep on reshaping industries such as:
• VR and AR will take bright new avenues in learning for students, helping them collaboratively construct knowledge, thus enhancing their reasoning in holding on to more complex issues.
• The applications arena will increase with immersive, interactive experience applications visualized for gaming, movies, museums, and theme parks.
• With VR and AR, retail experience personalization will increase to such an extent that customers will no longer need to have brought the product up to the offline shop, where they will have interactions on how the product works before their purchase-an increasing benefit for involvement satisfaction.
• The applications of VR and AR include advanced real-style training simulations for health practitioners and immersive therapeutic environments that improve mental health treatment.
• Use of VR and AR will include pilot training in aviation, as well as that of ground crews, with simulations at nearly real flight conditions for confidence and skill enhancement.
• In realistic settings, the engineer, mechanic, and designer shall use VR and AR technologies as a means of testing products in order to support their predictions of what problems are likely to occur so that improvements can be made within the facility before implementation.
VR and AR would radically change business models and operations across industries by 2025, especially with digital twin technologies. The technologies would begin to penetrate daily life with use in everyday tasks, it is estimated 3.7 billion people would be users by 2029.
6. Synergy Between Humans and Machines.
Such are the technology categories that describe a wide range of advanced and futuristic technologies aimed at enhancing human performance and facilitating seamless interactions between humans and machines.
The combination of robotics and AI will result in multifunction robotic machines capable of conducting autonomized complex and precise treatments. These are expected of particular significance in a wide range of industries, such as healthcare and manufacture. According to World Robotics Report 2024, number of robots in the world continues to grow, among which further accelerated growth is expected for 2025 and beyond.
With a swift pace, neurotechnology is anticipated to read and augment brain activities today. It has great potential in two primary areas:
• treatment of cognitive disorders;
• and enhancement of skill acquisition in individuals. In organizations, neurotechnology will facilitate improving employee skills and create more effective marketing strategies while also speeding the progress of the whole field by combining AI and nanotechnology.
7. Cybersecurity and Digital Trust.
Cybersecurity will definitely remain even until 2025 such an important fact due to the ever-increasing emergence of threats that are sophisticated and newer in development. Security systems powered by artificial intelligence will commonly become the new trend with the organizations, enabling automatic analyses of huge data to conduct the entire operation much more efficiently in detecting and responding to incidents.
The following are some of the projected significant trends in cybersecurity by 2025:
• Evolving developments in AI and machine learning for incident detection and response capabilities further promote the use of AI approaches by security services.
• Data protection and secure transactions across digital transformation will accompany compliance with new regulations such as NIS 2 and DORA.
• The zero-trust security model which also requires verification of every user before granting access is going to be a major trend in cybersecurity for 2025 as it will add an additional layer against unpermitted access.
It is for certain that the year 2025 will be when convergence happens, touching on AI, cybersecurity, sustainability, and frontier technologies including quantum computing, VR, AR, and neurotechnology. The companies and IT professionals who face these trends and embed them into their work will do their luck in success and growth not only in 2025 but also for many more years ahead.
CONCLUSION
In Europe's increasingly bright area of innovation and startup destinations, Portugal moves a step ahead in 2024. The startup numbers have continuously increased in most sectors, notably that of Information Technology, and with a very friendly environment in doing business and governmental backing, it is now pleasing international investors and highly skilled professionals. With all of these examples, it is approached through artificial intelligence (AI), cloud computing, blockchain, 5G, quantum computing, and augmented reality as major emerging technologies. These are typical use courses for health-care, financial, educational, or industrial applications.
These state-of-the-art technologies are being used by Portuguese start-ups not only to make forays into the local market but also onto the international turf and rake-in significant amounts in exports. Added to this, Portugal has in place a conducive regulatory environment and geographical location, thus making it the ideal outpost for international start-ups that are willing to expand around the globe.
Future emerging and disruptive technologies-in 2025 generative AI, quantum computing, and the Internet of Things-would have continued development and new opportunities for businesses to grow, increase productivity, and increase the safety and security of their work. Hence, Portugal is one of the best places to be at the forefront of technological innovation and to attract more startups and investors worldwide.
References
Mapping Portugal’s Startup Landscape 2024: Growth and Innovation at the Forefront.
https://startupportugal.com/startup-entrepreneurial-ecosystem-report-2024/
Startup & Entrepreneurial Ecosystem Report 2024.
https://portugalglobal.pt/en/news/2024/november/portugal-s-startup-scene-soars-with-16-growth/
Portugal’s Startup Scene Soars with 16% Growth.
10 super promising Portuguese startups to watch in 2024 and beyond!
https://sifted.eu/articles/portugal-under-the-radar-startups
Portugal’s best under-the-radar startups, according to investors.
Events in Portugal.
Developer conferences in Portugal 2024 / 2025.
https://www.alter-solutions.pt/blog/tendencias-it-2025
IT trends in 2025.
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