Isaac Newton, the English scientist known for promulgating the laws of motion and gravity and inventing the telescope, among other achievements, wrote to an associate several centuries ago that “if I have seen further it is by standing on the shoulders of Giants.” He meant it as a metaphor that, over time, has come to symbolize scientific progress and innovation.

Today, I would humbly posit that we stand on the shoulders of cloud-computing giants. Many of these huge, fast-growing companies are prospering, despite the current tech-market swoon, by using cloud software—largely out of public view—to manipulate and analyze unbelievable amounts of data and fundamentally transform the ways we live and work.

Cloud companies are poised to create billions, perhaps trillions, in global economic value and represent a bright spot in an otherwise dismal economic landscape marked by geopolitical turmoil, rising inflation and continuing supply-chain woes.

Simply put, Marc Andreessen was right in his 2011 estimation that software will eat the world. Software has already eaten the tech-forward world, but there’s more on the menu.

Inflation leads to innovation

We are at a historic market inflection point. “Cloud penetration,” meaning the amount of corporate technology spending attributable to cloud-based software instead of old-style tech running on on-site servers, is rapidly expanding with ample room to grow. In 2022, as we predict in a report released earlier this month, cloud spending will represent about 25% of $919 billion in overall tech-infrastructure spend.

If history is any guide, the inflationary market dynamics of today will lead to a step-function increase in tech adoption as companies leverage increasingly sophisticated software to make their operations more efficient and cut costs. Where there are economic downturns, market dynamics gravitate toward technological innovation.

We saw it a little less than six decades ago, in the 1960s, with the inception of satellite navigation systems, the electronic spreadsheet and the personal computer; then 30-plus years ago, after the inflation peak in the early 1980s, with advances in scripting languages and multimedia platforms. And we’re seeing it now with the cloud.

Future growth will come in industries and economic sectors that have, to date, been late to Mr. Andreessen’s decade-old software party. But they still stand to benefit from the cloud’s ability to capture and analyze data.

Already, today, many of the largest and most profitable businesses in the world are powered by major cloud vendors. They include Amazon Web Services—a subsidiary that is now the company’s most profitable segment and could soon eclipse Amazon’s core e-commerce business—as well as Google Cloud and Microsoft Azure. Just last month, Google said its cloud-computing unit generated $6.9 billion in revenue for the just-ended quarter, up 38%, while Microsoft said revenue in its Azure and related cloud-services business surged 35% despite a slowdown in consumer spending.

These backbone cloud services help provide the infrastructure for newer cloud-data upstarts like Databricks* (in which Battery is an investor), Snowflake, MongoDB, Twilio, Okta and others, extremely fast-growing companies that remain mostly unknown to non-geeks but are increasingly recognized for their ability to deliver critical operational efficiencies and deflationary effects to their customers.

Four of those five companies gross $1 billion or more in revenue, and all continue to post double-digit growth rates in today’s otherwise uncertain economy, according to company earnings reports and statements.

From drugs to ketchup to clothes

Cloud technology has wide-ranging applications that benefit consumers and businesses alike. They range from Walgreens’ use of predictive data analytics to forecast demand for specific drug s, to Kraft Heinz calculating the optimal amount of condiment inventory on supermarket shelves across the country, to Rent the Runway leveraging automation-driven robotics, enabled by the cloud, to rapidly accelerate processing time for returned designer clothes.

These early corporate-cloud adopters stand on the shoulders of cloud giants, and the view from that height is impressive. Many more upstart cloud-software providers are waiting in the wings to deliver services to large corporate customers. There are about 15 private “unicorn” software firms – those valued at $1 billion or so – now worth $10 billion or more, based on data from Pitchbook and my firm’s research, even after the recent stock-market drop.

Are those valuations crazy? Maybe, or maybe not, considering the cloud opportunity. There remains a huge part of the world lagging behind with intractable data problems: terabytes upon terabytes of information that no one collects, cleans or analyzes at an incalculably expensive opportunity cost. The cloud is the only place with enough computing power to enable the required storage, security and analysis at this monumental scale.

Compounding this disconnect is the fact that shockingly few workers are data-literate, and most have low levels of confidence when it comes to making data-based decisions, according to a 2020 Accenture Report. This means the majority of the world’s workforce is not fully cognizant of data’s potential power – and that lack of understanding comes with steep costs.

The cloud’s true potential

Despite these challenges, I firmly believe we will soon see a proverbial quantum leap in precision and productivity, necessitated by an inflationary environment and enabled by cloud innovation. Consider Newton’s Law of Inertia: Every object persists in its state of rest or uniform motion, in a straight line, unless it is compelled to change that state by forces impressed upon it. There are significant forces at play today that signal we are entering a technological growth spurt.

We will soon see cloud-enabled programs like “generative AI” transform industries that currently require humans to produce original work – computer coding, social media posts, sales materials, legal briefs – through more sophisticated support by machines, with the potential to generate trillions in economic value and improved labor productivity.

Cloud data will also transform fields like medicine and patient care. Specialties like genomics will use massive quantities of data to transform the way illnesses are treated, ushering in a new era of precision medicine that leverages the cloud to analyze complex genetic and patient information, including the social determinants of health. The cloud revolution in healthcare will soon lead to highly personalized treatments, promising reduced patient side effects; faster, more effective treatments; and improved health equity.

Access to home ownership will also improve as part of this new cloud-data revolution, allowing more families to build wealth. Mortgage lenders transitioning to the cloud will make it easier to analyze borrower incomes, employment, assets, property valuations, payment histories and detailed loan terms, among other data points. This will, in turn, improve the productivity and accuracy of lenders and system fairness for consumers. We can reach a point where non-traditional metrics (rent or student loan payments, for example) can be integrated into mortgage lending or credit score tracking, with enormous, transformational consumer benefits.

As sci-fi author William Gibson put it: “The future is already here; it’s just not evenly distributed.” Data, manipulated in the cloud, is an incredibly powerful resource, but we have to put it to good use. Cloud technology will help us get there, and it might help move us out of our current economic malaise as well.