Venture Capitalists’ Growing Interest In The Internet Of Things

Venture Capitalists’ Internet Of Things

Investors, even venture capitalists, can be a cautious bunch. While they may have a reputation for throwing money at a sector or industry just to see what sticks, the reality of their approach couldn’t be further from the truth. As we reported back in August last year, venture capitalists have been using big data for a long time to spot their next investment, but now the time to actually invest in the technology they are using appears to be edging closer.

As markets for wearables, smart TVs, connected cars and the smart home begin to mature, the venture capitalists are sensing the time for them to take the plunge is ripening. “The connected car and home are as big an opportunity as the connected phone,” said Venky Ganesan, a managing director at Menlo Ventures. “When the iPhone came out in 2007 we had a difficult time seeing all the things that would emerge out of that platform. Similarly, it will be tough to envision and predict all the innovations that are going to emerge out of this platform, but I am sure they will and it will be equally transformative”.

Ganesan’s observations are reinforcement by the reality on the ground. Undoubtedly a shift is taking place; increasingly investors are thinking less about hardware and more about software, infrastructure and security – the primary enablers of the internet of things. As Gartner expects the IoT market to double in the next two years and almost triple in the next three, the challenge for potential investors becomes when to ‘place their bets’, rather than if.

Dominate Fund Managing Partner Ben Parr is less cautious, and believes that it’s not too early to get involved. “I think we probably will make our first investment this year,” Parr said. “We know companies have trouble getting traction and getting prices down … but there will only be a small set of winners and we want to be one of them”.Jason Krikorian, a Partner at investment firm DCM is cautious. “The points of connectivity are proliferating”, he said, “but it’s imperative that all these devices and systems work together in a way that is comprehensive”.

As we’ve discussed before on CloudTweaks, this lack of standards and interoperability is one of the biggest challenges facing the internet of things and wearable tech over the next two years. It means competing formats such as Bluetooth, ZigBee, HomeKit, Iris and SmartThings aren’t likely to converge this year, making investment bets complicated to time. Eventually one may emerge as the ‘winner’, but with the current market that is almost impossible to predict.

What do you think? Are you an investor? Would you put your own money into some of the smaller start-ups and young companies who have a chance to become the leader in Wed 3.0, or is the market still too immature and the risk too great?

By Daniel Price

Louis
Tighter budgets, a near-record level of projects to be done with a smaller staff and a rising number of malware-free attacks are a few of the many challenges taking the security team’s time away from zero trust. CISOs ...
Marcus Schmidt
Microsoft’s Operator Connect Earlier this year, Microsoft announced a new calling service for Microsoft Teams (Teams) users called Operator Connect. IT leaders justifiably want to know how Operator Connect is different from Microsoft’s existing PSTN ...
Matthew Groves
NoSQL and the Media NoSQL is becoming the must have for organizations needing to manage data in ways that traditional relational databases were just not designed for. What has the industry media been saying about ...
Veljko
5 Recruiting Software Tools Finding the best candidate in the sea of thousands of developers can be very hard for a company that operates in fields such as technology and software development. The manual sourcing, ...
Gary Bernstein
Benefits of Using an Enterprise Service Microsoft 365 Business connects employees with the people, information, and content they need to get the most out of any device. In business, we talk a lot about efficiency, ...
  • Plural Site

    Pluralsite

    Pluralsight provides online courses on popular programming languages and developer tools. Other courses cover fields such as IT security best practices, server infrastructure, and virtualization.

  • Isc2

    ISC2

    (ISC)² provides IT training, certifications, and exams that run online, on your premises, or in classrooms. Self-study resources are available. You can also train groups of 10 or more of your employees. If you want a job in cybersecurity, this is the route to take.

  • App Academy

    App Academy

    Immersive software engineering programs. No experience required. Pay $0 until you're hired. Join an online info session to learn more

  • Cybrary

    Cybrary

    CYBRARY Open source Cyber Security learning. Free for everyone, forever. The world's largest cyber security community. Cybrary provides free IT training and paid IT certificates. Courses for beginners, intermediates, and advanced users are available.

Cloud Community Supporters

(ISC)²
Aws
Hp
Ca
Cisco Logo

Cloud community support comes from sponsorship advertising and collaborative network partnership initiatives.

Contact us for more information on how to get involved in our flexibly priced programs!