Entrepreneurs and their start-ups are the source of much of the technology industry’s incredible growth and innovation. But they aren’t always the ones left standing as the competition for customers and investor dollars unfolds. Expect 2016 to be a year when the big dogs swallow some of their competition—and where Apple rolls out some more bold surprises.
Apple Will Buy Tesla…
Apple has announced plans to build an electronic car, targeting 2019. Apple could dramatically accelerate this timetable by buying Tesla. With over $200 billion cash on hand, the iPhone-maker has more-than ample resources to absorb the purchase, especially now that some of the bloom has come off Tesla’s once-rosy stock. In addition to its automobile know-how, Apple gets access to Tesla’s battery technology, which CEO Elon Musk claims can help change “the entire energy infrastructure of the world.” Of course, Apple would also get Musk—a worthy heir to Steve Jobs’ “think different” legacy and ideally suited to be Apple’s futurist, chief technologist and CEO-in-waiting. —Aaron Task
…While Becoming the First $800 Billion Company
Apple just announced record earnings for fiscal 2015, posting nearly one-quarter of a trillion dollars in revenue, and it remains the most valuable public company by far. Apple briefly held the title of the world’s first $700 billion company in the first half of 2015, and Wall Street analysts believe it’ll shatter that mark next year: Their average 12-month price target of $149 would give Apple a market capitalization of $831 billion. To get there, Apple shares would have to rise 22%. But considering its track record, it seems realistic to expect that Apple will justify that kind of bump, by continuing to gain smartphone market share and achieve strong growth in emerging economies. —Scott DeCarlo
Unicorn Investing Will Get Ugly
Everyone in startup-land is happy when valuations are going up. But if, as prominent venture capitalists have predicted, some billion-dollar unicorns turn into unicorpses in 2016, the opaque world of startup investing will get ugly. (Unicorns whose valuations are already showing cracks include Dropbox, Evernote, and of course Theranos.) Today, in-demand startups restrict trading of their shares on secondary markets like Nasdaq Private Market. But clever investors find ways around this by trading through intermediaries and employees. Once the biggest startups begin to struggle, the work-arounds will proliferate—only with sellers dominating as investors flee bad bets. Expect wild discrepancies in valuations; angry finger-pointing among investors, boards and CEOs; and maybe even some private company shareholder activism. —Erin Griffith
Why Jack Dorsey Will Leave Square (But Stay at Twitter)
Steve Jobs spent nearly a decade as CEO of both Apple and Pixar—but don’t expect Dorsey to follow a similar trajectory. Not too long after payments technology company Square goes public, Dorsey will leave the company, while staying on as permanent CEO of the other tech giant he co-founded, Twitter. As a newly public company, Square needs a seasoned chief who can weather Wall Street’s demands for growth, says Sucharita Mulpuru, analyst at Forrester Research; Twitter, on the other hand, needs Dorsey’s design and product expertise. (One possible successor to Dorsey at Square: Jacqueline Reses, Yahoo’s former chief development officer, who just joined the company.) —Leena Rao
The Cybersecurity Startup Boom Will End
It’s hard to find a hotter startup segment than cybersecurity. Panic, paranoia and fear of missing out on the next lucrative opportunity have led investors to rain down capital on any firm endeavoring to keep hackers at bay. The sector raised about $2.5 billion in 2014, and it is on track to perform similarly this year. There will be a reckoning, though: Too many upstarts are building too many “me too” tools. Expect well-funded top dogs—companies like Bit9 + Carbon Black, Tanium, CrowdStrike—to weather the storm while more traditional big tech names and security stalwarts snap up smaller firms through “tuck in” acquisitions, cleaning up the field as the pipsqueaks wither away. —Robert Hackett
An Entrenched Computer Security Company Will Get Hacked
First, a disclaimer: Fortune wishes no ill upon any company. That said, we believe a trusted name in security will be utterly and embarrassingly hacked in 2016. Perhaps it’ll be a veteran firm like Symantec, or an entrenched tech giant with a cybersecurity arm—like Intel, Cisco, or EMC (er, sorry, Dell). Point is: Ever since Edward Snowden pillaged the NSA, the world has come to grasp that no organization is sacred—or fully secured. Already this year, computer crackers drubbed the Italian spyware firm Hacking Team and breached the personal email account of the CIA director. So, quis custodiet ipsos custodes? —Hackett
The Food-Delivery Bubble Will Pop
Everybody eats—but we may not eat nearly enough to support the ballooning food-delivery tech category. Consulting firm Rosenheim Advisors counted 88 companies in the U.S. that offer either meal kits, meal delivery, food e-commerce, online grocery shopping, or online ordering. “In the next 12 to18 months there will be some reckoning,” says Brita Rosenheim, who runs her eponymous firm.
She estimates that $733 million has flooded into in food tech delivery over the last six months from U.S. private investors, representing 57% of the total invested in food tech. That’s already more than the $697 million that was invested in all of 2014 (representing 28% of all food tech investments).
One sign of glut: The industry is starting to run out of names. Within the online-ordering category alone, there’s already EAT24, FoodtoEat, EatStreet, and EAT Club, to name just a few. —Beth Kowitt
Adapted from an article on Forbes.com