The Internet of Things – Market Update

The Internet of Things – Market Update

Woodside Capital PartnersQ3:2015

TABLE OF CONTENTS

I. Connected Home⁻ Amazon and Google Quietly Building a Position

⁻ Retrofitting Bridges a Gap

⁻ Other Players – icontrol, Control4,

⁻ Standards Still Unsettled, But Essential

⁻ Another Big, New Entrant – Salesforce.com

⁻ Stage Is Set For a Competitive Battle

II. Fitbit and Wearables

III. Market Trends in IoT

IV. Semiconductors and the IoT

V. Selected Private Companies

VI. M&A Transactions

VII. Private Placements

Executive Summary

In March, Woodside Capital Partners prepared a comprehensive report on the Internet of Things (IoT). In this short update, we will focus on a few key developments relating to the consumer space and the Connected Home, as well as address M&A activity in the semiconductor sector. In particular, we see the outlines of a major competitive battle forming in the connected home segment, with competitors from multiple industries (both established and relatively new) attempting to attract the attention of the consumer. Key points:

Powerful Competitors: Google and Amazon are both working hard (but quietly) on solutions related to IoT Retrofits: In the consumer space, particularly the Connected Home, the ability to retrofit IoT functionality onto

existing installed equipment is an important stepping stone to full adoption. However, retrofit solutions may suffer from too many limitations to ultimately be successful

No Standard: No single standard is close to dominant as multiple standards exist across the various IoT areas -this will continue to be an issue for some time to come

Wearables: Wearables present an area of strong consumer interest - but as yet, there is no emergent winner and no clear use case. It is still unclear whether a more universal device like the Apple Watch will be preferred over more dedicated designs like Fitbit

Intel IoT Activity: Intel continues to be active with investments and acquisitions targeting the IoT space Semiconductor Consolidation: IoT functionality will continue to drive consolidation in semiconductors

http://www.woodsidecap.com/wp-content/uploads/2015/03/WCP-IOT-M_and_A-REPORT-2015-3.pdf

The Fight for the Smart Connected Home

Source: HomePlug Alliance

(Lots of opportunities to connect “things” in the home)

Amazon – Stealthily Building an IoT Platform

Amazon operates Amazon Web Services, which powers the critical backbone infrastructure of most software startups as well as established tech players like Apple (iCloud) and Netflix

– AWS includes compute, storage and content delivery, databases, networking technologies and administration and security tools

Amazon recently purchased 2lemetry, a Denver-based startup offering the Kinesis platform to process and analyze high volume data streams from multiple sources in real time – such as IoT devices

Amazon’s recent launch of Echo offers voice control of “Things” in the consumer’s home

Amazon’s Dash product allows consumers to instantly order replenishment supplies of household items at the push of a button or with a wave of a scanning wand. While not an obviously advanced technology, it lays the groundwork for sensors that can automatically replenish consumables like laundry and dish detergent in the home. Amazon can profit both from the direct sale and from a relationship with the consumer product company for promoting its brands.

WCP believes Amazon will continue development and investment in this space4

Google: Brillo and Weave – more standards?

With Brillo and Weave, Google enters the IoT platform/standards fray. Brillo extends beyond the consumer space targeted by Nest and is also aimed at industrial applications, smart agriculture, and remote infrastructure

WCP notes that Nest’s acquisition of Revolv last year in the Connected Home space and attempts to woo developers with tools point to the increased attention on IoT

Brillo is an underlying OS for IoT devices. It is built with minimal system requirements and supports Wi-Fi, Bluetooth Low Energy, and other connectivity options

Weave is a communications protocol compatible with, but not equivalent to, the existing Nest protocol, allowing Brillo-powered devices and other “Things” to communicate

5

6

iControl – Another Platform Provider

iControl looks to leverage its long standing position in home automation and AV Control with PaaS distribution through cable/telco and home security vendors

7

Recent IPO (approx $628 million) provides Alarm.com with fresh capital

Alarm.com joins Control4 as the only publicly traded pure play Smart Home players

Alarm.com is approaching the Smart Connected Home through the home (and business) security systems channel; using sophisticated SaaS analytics and serving a national network of independent installers/service providers

Control4 has its origins in home entertainment system controls

Both offer multiple control systems including security, energy management, video monitoring, and other on-premises management through the mobile phone

Alarm.com and Control4 – A Different Channel

Honeywell - 1953

Nest - 2004

Continuous experimentation continues as manufacturers determine how to best approach this opportunity, and to do so profitably

We expect it will take several years (perhaps decades) before these devices become fixtures in regular homes.

Innovative and creative (almost Rube Goldberg) solutions exist to retrofit legacy smoke alarms and air conditioners, making them “smart”

Are these “Smart Retrofits” delaying the roll-out of “true” smart home solutions developed by Nest and others?

The Smart Home – Is Retrofitting an Answer?

Anticipated for decades, the Smart Home finally looks like it could become a reality (albeit slowly) for home automation, home security and energy efficiency

Honeywell introduced its classic T-86 round thermostat in 1953. It is one of the world’s most recognizable industrial designs and is still available today

Google’s acquisition of Nest for $3.2 billion and Samsung’s acquisition of SmartThings in 2014 is still generating plenty of excitement

Apple HomeKit offers a home automation framework for developers, and aims to integrate multiple vendors’ products that are only controlled by an iPhone or iPad

8

The Smart Home – Is Retrofitting an Answer? (continued)

Tado Smart AC Control Claims to make any remote-

controlled air conditioner smart Wi-Fi enabled unit uses infrared

to issue commands to AC Control via smartphone app Will use proximity of phone to

AC to adjust temp and reduce energy bills

IFTTT integration and Apple HomeKit

$199, Available now Future sensors for temperature,

humidity, noise, motion, etc. via Bluetooth LE

Funding: Kickstarter

Leeo Smart Alert Nightlight WiFi-enabled nightlight Listens for specific industry-

regulated frequencies from smoke detectors and CO alarms

Sends alerts to smartphones $100, Available now No-fee alarm monitoring

Kidde RemoteLync WiFi-enabled device that

plugs into electrical outlet Listens for smoke or CO

alarms Uses WiFi to send alert to

smartphones $99, Available now at

Home Depot (Kidde - UTX: $81B mkt. cap)

AC

Roost Smart Battery WiFi-enabled 9V battery Retrofits smoke and CO

detectors allowing them to send alerts and low-battery notifications to smartphones

Claims $35 battery can last up to five years

Shipping in late 2015 Funding: Kickstarter plus

Series-A, $5.5M, 09/2015

9

IoT will not be like electrical power connectors; we’ve learned some things since then…

Standards For Interoperability – Imperative, But Elusive?

In order for there to be an Internet of Things, the Things must, by definition, communicate easily and reliably with one another

Multiple standards exist now

Large platform players quietly preparing to dominate:

– Google– Amazon– Apple

Smaller platform players will need to inter-operate with all available protocols for best results

Different standards may prevail for different vertical applications due to differing requirements (e.g. power requirements, security, guaranteed reliability, etc.)

10

11

Qualcomm throws its support behind the Thread Group, a Google-backed initiative to facilitate further interoperability for Internet-connected devices to communicate.

Other alliances are forming to focus on both industrial and consumer segments of the marketplace. A sampling:

Standards Are Still Unresolved

12

At its Dreamforce 2015 conference this month, Salesforce.comannounced its new “IoT Cloud,” a service provided by Salesforce that promises to help monitor billions of events relayed in real-time by smart devices.

IoT Cloud is powered by Salesforce Thunder, a massively scalable, real-time event processing engine that enables Salesforce customers to personalize the way they sell, service, market and more.

The intention appears to be to enable Salesforce customers to connect their CRM records with actionable event data from virtually any data-based input source, and to allow simple point and click programming of event triggers based on the nature of incoming data.

Another Big, New Entrant – Salesforce.com

Connected Home

Telco ISP / Cable MSOs

Home Appliance Giants Security/Alarm

Tech Giants (Amazon, Apple,

Google, Microsoft, Sony,

Samsung)

Energy Management Systems

Connected Home is a Major Battleground

13

Alarm companies have a presence with existing installed

base of low voltage technologies

Appliance vendors are present, but not currently associated with high tech or

connected home technologies

Telco ISPs and Cable MSOs have existing CPE and

relationships with customers (though perhaps not

altogether happy relationships) – ISPs have also

been a primary vector for introducing new tech into the

home (broadband, WiFi)

The tech giants enjoy a better reputation with consumers for the most part, but have not

historically been deeply engaged in the homeEnergy Management is challenged by the intersection of new technologies and legacy public utility conservatism. Utility pilot projects are being overtaken by more comprehensive smart home platforms that offer energy management as a component feature

Source: Credit Suisse

Fitbit and Wearables

A Succesful IPO On June 18, Fitbit (NYSE:FIT) became one

of the first health-wearables companies to go public

Fitbit products are based on sensors and chips from companies such as STMicro, ARM, Nordic Semi, and TI

According to IDC, Fitbit had 34% share in Q1 of fitness band/activity tracker market.

Post-IPO, with $461m in cash on the balance sheet, and a $6B+ market cap, the company is in a better position to navigate the crowded and highly-competitive wearables market

But Facing Formidable Challenges There are parallels between single-purpose Fitbit and another high-flyer, Blackberry, a single-purpose email device At its peak the Blackberry phones controlled 43% of the US market and the company had a market cap of $83 billion The arrival of multipurpose smartphones, especially the Apple iPhone and the App store, was the death knell for

Blackberry We wonder if the Apple Watch will do to Fitbit what the iPhone did to the Blackberry? (Recent reports suggest the

Apple Watch is not a runaway success). Morgan Stanley projects 35 million Apple Watch shipments in 2015. At $350/each this translates to revenue of

approximately $12 billion At the price-sensitive low-end, Chinese manufacturer Xiaomi offers a $15 fitness wearable (Xiaomi’s Mi Band

accounted for 25% of the wearable devices shipped in Q1:2015)

Could Fitbit Go The Way of the Blackberry?

Source: Fitbit S1 Filing, Leerink Partners, Dougherty & Co, RBC Capital Markets

0.2

1.3

4.5

10.9

19.3

2011 2012 2013 2014 2015E

Devices SoldIn Millions

$14.5$76.4

$271.1

$745.4

$1,339.9

2011 2012 2013 2014 2015E

Total Revenue$ In Millions

0.6

2.6

6.7

9.5

2012 2013 2014 2015 (Q1)

Paid Active UsersIn Millions

15

Could Fitbit Go The Way of the Blackberry? (continued)

A recent study from the University of Pennsylvania School of Medicine looks at the question of whether free smartphone apps (running on iPhone and Samsung Galaxy) could be as accurate at measuring user steps as wearable fitness devices that cost more than $100. Devices studied came from Fitbit, Jawbone and Nike’s discontinued Fuelband. The researchers found that the accuracy of free smartphone apps and dedicated wearables was about the same.

Apple Watch Sport ($350 - $400) Xiaomi Mi Band ($15)Fitbit ($70 - $250)

$6.3$630

$1,260$2,520

$5,166

$7,140

$8,862

$10,920

$12,642

$0.0

$2,000.0

$4,000.0

$6,000.0

$8,000.0

$10,000.0

$12,000.0

$14,000.0

2010 2011 2012 2013 2014 2015 2016 2017 2018

Mar

ket V

alue

($M

)

Wearable Device Martket Value

Source: Statistica

Products Replaced by Smartphones Point-and-shoot cameras Standalone GPS devices Standalone MP3 players Health-wearables?

16

IoT Market Trends

17

220282

410

574

1,398

0

300

600

900

1,200

1,500

2012 2013 2014 2015E 2018E

Mill

ions

of C

onne

ctio

ns

New Connections to Internet of Things

2012 2013 2014 2015EConnected Homes $0.6 $0.7 $1.0 $1.4Connected Vehicles $0.8 $1.0 $1.4 $2.0Wearable Systems $0.7 $0.8 $1.1 $6.1Industrial Internet $6.4 $7.8 $9.6 $12.4Connected Cities $24.7 $29.6 $35.3 $40.5

$0

$10

$20

$30

$40

$50

$60

$70

Wor

ldw

ide

Reve

nue

($B)

Revenue for IoT Subsystems

Connected Cities

Industrial Internet

Wearable Systems

Connected Vehicles

Connected Homes

IoT revenues set to grow by 29% to $62.4B in 2015

Consumer IoT to grow by an compounded annual growth rate of 21.1% from 2013 - 2018

IoT connections grew by 45% between 2013 – 2014

Total IoT connections to reach 13.2B units in 2015

Source: IC Market Drivers 2015 Update Source: IC Market Drivers 2015 Update

Source: IC Market Drivers 2015 Update

Semiconductors and the IoT

IoT a Factor in Semiconductor M&A?

19

Will IoT help sustain the wave of consolidation moving through the Semiconductor Industry?

The semiconductor industry is experiencing a wave of consolidation driven by companies looking to gain a competitive advantage, drive economies of scale, and enter new markets. During the first half of 2015 alone, total deal volume exceeded $70 Billion. Avago’s pending $37 billion acquisition of Broadcom represents the largest deal to date, and Dialog’s just-announced $4.6 Billion acquisition of Atmel continues the IoT-related deal trend.

Value of Semiconductor Industry M&A Agreements Surges (Data Through 06/30/15)

Consolidating the Chip IndustryDate Company Acquiror Amount ($M)Sep-15 Atmel Dialog $4,600Jun-15 Altera Intel 16,700May-15 Broadcom Avago 37,000Mar-15 ISSI Summitview Capital 640Mar-15 Freescale NXP 11,800Jan-15 Silicon Image Lattice 600Dec-14 Spansion Cypress 1,600Aug-14 OmniVision Hua Capital 1,900Jun-14 Renesas SP Drivers Synaptics 475Dec-13 LSI Avago 6,600Aug-13 Voltera Maxim 605

TOTAL: $82.5 Billion

20

IoT a Factor in Semiconductor M&A? (cont.)

Dialog Semiconductor PLC has just announced a $4.6 billion cash and stock deal to buy Atmel Corp., a manufacturer of microcontrollers used in smartphones, smart watches, and Arduino-related circuit boards, building blocks said to be “essential to the IoT.”

NXP’s $11.8 billion acquisition of Freescale Semiconductor (announced in March) creates the fourth largest non-memory semiconductor company and the largest automotive IC supplier. However, as Freescale CEO Gregg Lowe highlighted in an EETimes interview, the merger will also make the company the “most comprehensive and complete” player in the Internet of Things market as it takes advantage of Freescale’s microcontroller market position and NXP’s security expertise.

Cypress Semiconductor’s $1.6 billion acquisition of Spansion, announced last December, is another example, bringing together a leading microcontroller company and a leading embedded memory company to create a very well-positioned IoT-related semiconductor company, especially related to automotive, medical and mobile applications.

The growth of IoT has been highlighted as a motivating factor in several recent large deals:

We expect to see additional IoT-related M&A deals that will help sustain the wave of consolidation moving through the Semiconductor Industry. Analog Devices, Linear Technologies, Maxim Integrated Products, Silicon Labs and other mixed-signal chip companies, are now likely takeover targets as a result. Microcontrollers represent another area of opportunity, as shown by the recent Atmel Corp transaction.

Intel has made over 200 investments since 2013

Over the last 12 months Intel acquired Altera, Lantiq, and IoT wearable device company ComposytLight Labs

Created specialized business unit for IoT

Forming consortium with AT&T, Cisco, GE, and IBM

Intel IoT Platform includes partners Accenture, Booz Allen Hamilton, Capgemini, Dell, HCL, NTT DATA, SAP, Tata Consultancy Services Ltd., Wipro

Partnership with Cisco

Intel’s Impact on IoT

21

Investments

SELECTED PRIVATE COMPANIES

Source: CapitalIQ, Crunchbase

Private Company Profiles

23

Company Details Funding ($M) InvestorsAtlas Wearables provides a fitness monitor/activity tracker that identifies exercises, counts reps and sets, calculates the calories burned, and evaluates the users’ form and offers data analytics services.

$2.4 In-Q-TelJRG Capital Partners

Ayla Networks owns a cloud-based connectivity platform for the Internet of things. Ayla offers cloud connectivity solutions for manufacturers to turn appliances, HVAC and more into intell igent devices.

$25.4 CrossLink CapitalVoyager Capital SJF Ventures SAIF Partners Cisco Investments

BluVision provides Bluetooth beacon and micro location cloud solutions. It offers BEEKS beacons that track assets, manage inventory, trigger contextual location messages, implement security functions, and others to enterprises of various sizes.

NA NA

decaWave, a fabless semiconductor company, engages in the architecture and design of integrated circuits for communications equipment markets. The company specializes in ultra wideband technology for real time location systems and wireless sensor networks.

$22.6 International Investment & Underwriting Enterprise IrelandLG Electronics

ecobee delivers intell igent energy management solutions that enable residential and commercial customers to understand, manage, and reduce their energy consumption. It offers Smart Thermostat, which is internet enabled through Wi-Fi to monitor and manage home comfort.

$16.1 JLA VenturesTech Capital Partners Carrier Corporation Investeco Capital Relay Ventures

Electric Imp provides solutions to connect devices to the Internet, wirelessly. It offers an integrated way to connect hardware devices to other devices and to Internet services.

$23.0 Redpoint Ventures PTI Ventures Foxconn Electronics Lowercase Capital Rampart Capital


Private Company Profiles (continued)

24

Company Details Funding ($M) InvestorsEnOcean manufactures and markets wireless sensor solutions for use in buildings and industrial installations. It offers transmitters, receivers, transceivers, energy harvesters, kits and accessories; and energy harvesting wireless technologies, switches, and sensors, as well as wireless.

$40.7 Atmos Holding Emerald Technology VenturesKATHREIN-Werke KG, Siemens Venture

GainSpan engages in designing and marketing ultra-low power embedded Wi-Fi semiconductor and software solutions for smartphone monitored and controlled devices, and Internet of Things applications.

$118.2 OVP Venture Partners Sigma Partners Oplink In-Q-TelZebra Technologies

iControl Networks provides a software platform for service providers and home security companies enabling them to offer connected home solutions to households worldwide. The company also offers premise management services, which include device management, on-boarding, remote access, task scheduling, and video management.

$93.5 KPCBADT SecurityGEIntelComcast Ventures

Imprint Energy develops and commercializes zinc-based rechargeable battery technology solutions. It offers Zinc Poly, a battery technology that removes longstanding l imitations on the rechargeability of zinc-based batteries and enables the production of rechargeable batteries.

$6.0 Dow Venture Capital In-Q-TelPhoenix VenturesAME Cloud Ventures Flextronics Lab IX

Iotera develops a wireless tracking technology for objects. The company’s solutions include electronic tags that provide communication and geolocation capabilities; and a child tracking application service that is attached to a backpack.

$3.1 ZenShin Capital PartnersStartup Capital Ventures CrunchFund

IS2T provides embedded software solutions. It offers MicroEJ SDK, an open middleware platform to design, develop, and prototype flexible and compact embedded applications supported by various hardware systems.

$5.0 Innovacom Gestion



25

Company Details Funding ($M) InvestorsJasper Technologies develops cloud-based platforms that enable enterprises and mobile operators to launch, manage, and monetize Internet of Things (IoT) service businesses in the United States and internationally.

$196.8 Benchmark Capital Crescendo Ventures Sequoia Capital Pinnacle Ventures DAG Ventures

Link-Labs builds long-range machine to machine networks for the Internet of Things (IoT). The company provides long-range wireless network modules, gateways, and development kits for engineers.

NA NA

MicroGen Systems, a development stage company, intends to develop MicroElectroMechanical Systems (MEMS) based piezoelectric vibrational energy harvester technology to provide power for non-wireless electronics and wireless sensor network (WSN) applications.

$1.8 Xtrion

Mocana operates an enterprise mobile application security platform that facil itates organizations to deliver business-critical mobile applications for internal and external users. The company offers KeyTone, a mobile communications application that enables secure calls and instant messaging over WiFi and 3G/4G networks.

$55.0 Trident Capital Symantec Corporation In-Q-Tel Panasonic Venture Intel Capital

Newtrax Technologies designs and develops battery-powered wireless networking solutions. The company’s products include central servers, machinery modems and sensors, and data loggers. Additionally, it provides enterprise solutions focusing on power management, alarm management, reporting, and data communication.

$5.0 Jolimont Global Mining Systems

ParStream engages in developing and implementing high-performance analytical database systems. The company offers ParStream, a big data analytics platform that enables interactive business analysis on dynamic big data.

$13.6 Baker Capital Khosla Ventures CrunchFund Tola Capital Data Collective



26

Company Details Funding ($M) InvestorsPercolata provides cloud-based workforce management applications and sensors. It offers automatic staffing solutions; provides frictionless deployment solutions; predicts store traffic solutions; and increases staff availabil ity.

$5.0 Foundation Capital Menlo Ventures Google Ventures Andreessen Horowitz Karlin Ventures

Pivotal Software provides solutions that enable the creation of software applications that leverage big and fast data on a cloud independent platform. It offers Pivotal CF, a Platform-as-a-Service (PaaS) solution for agile development teams to update and scale applications on a private cloud.

$1,051.1 GE

Platfora develops data management software based on Hadoop. Platfora offers a big data analytics platform helping companies get insights into the events, actions and norm times of their business.

$65.2 Battery Ventures Cisco SystemsAndreessen Horowitz Sutter Hil l Ventures In-Q-Tel

Quirky operates an online community that enables its members to submit, tweak, and vote on various sorts of product ideas. The company enables its community members to submit ideas for the development of new products in the categories of electronics and power, health and fitness, home and garden, kitchen, travel and adventure, and other products.

$185.3 Andreessen Horowitz Atlas Venture Bear Ventures GE Ventures, KPCB

Sensoria designs, develops, and produces body-sensing wearable devices. Its products include anklet and sensor infused socks that provides step counting, speed, calories, altitude, and distance tracking data, as well as tracks cadence, foot landing techniques, and weight distribution on the foot, and fitness bras and t-shirts with heart rate monitor that provides heart rate data.

$5.6 Reply StartCaps Ventures

SIGFOX, a cellular network operator, provides cellular connectivity for Internet of things and machine-to-machine communications in France and internationally. It also offers various devices to connect to the Internet; and provides two-way transmission of data.

$151.3 Partech International IDInvest Partners Omnes Capital Zouk Capital SK Telecom



27

Company Details Funding ($M) InvestorsSine-Wave Technologies delivers enterprise software platforms, forming a digital nervous system, connecting devices to the Internet of Things. Sine-Wave transforms assets, whether smart electronic devices, intell igent machines, wearable sensors or even simple inventory items into connected, controllable assets.

NA NA

Strava provides Strava, an application for cyclists and runners to track rides and runs via iPhone, Android, and dedicated GPS devices to analyze and quantify performance. Its application enables athletes for social fitness—sharing, comparing, and competing with each other’s personal fitness data via mobile and online applications.

$34.6 Sequoia Capital Sigma Partners Madrone Capital Partners Sigma West

Stream Technologies delivers machine-to-machine communication solutions for the Internet of Things. It offers IoT-X, a unified access connectivity environment enables management of connected devices regardless of bearer technology.

NA NA

Wink developes technologies to bring together a diverse set of products from many different brands all in one app. Wink is focused on simplifying the process of connecting and controll ing products via a mobile app on Android and iOS.

NA NA

M&A TRANSACTIONS

Recent M&A Transactions

Source: CapitalIQ, 451 Research and Woodside Capital Partners estimates 29

Date Acquiror TargetTransaction Value ($M)

TV/Revenue Multiple Target Business Description

09/20/15 Dialog Semiconductor Atmel $4,426.5 3.1x Atmel designs, develops, manufactures, and sells semiconductor integrated circuit products primarily in the United States, Asia, Europe, South Africa, and Central and South America. (Transaction value as-of: 9/21)

09/17/15 Alcatel-Lucent Mformation Software Technologies

NA NA Mformation Software Technologies provides mobility management solutions for wirelessly connected devices.

09/14/15 Qualcomm Capsule Tech NA NA Capsule Technologie provides medical device integration solutions for hospitals and healthcare organizations.

09/10/15 IBM StrongLoop NA NA StrongLoop provides Node.js-powered tools to build, deploy, and scale APIs to connect applications and devices to data. In addition, it offers graphical and command line tools for building, deploying, clustering, and scaling node applications.

09/02/15 Ansys Delcross Technologies NA NA Delcross Technologies, offers software engineering and development services.

08/27/15 Autodesk SeeControl NA NA SeeControl develops and operates an Internet of things (IoT) business applications platform.

08/25/15 Hortonworks Onyara 38.5 NA Onyara operates in the technology industry.

08/10/15 Aricent SmartPlay Technologies 180.0 NA SmartPlay Technologies provides design services for digital, analog, embedded software, system design, and geo-modeling solutions.

07/30/15 ARM Holdings Sansa Security NA NA Sansa Security provides security solutions for mobile handsets, smart phones, the IoT and Wi-Fi devices.

07/23/15 IBM Compose NA NA Compose operates a managed platform that is used by developers to deploy, host, and scale databases.

07/16/15 Synopsys Sil icon Vision (Bluetooth Smart IP)

NA NA Silicon Vision provides low-power wireless intellectual property solutions. The company’s solutions include Bluetooth low energy radio, low power ZigBee radio, Sub 1-GHz ISM radio for smart meters, and other low power wireless radios.

07/01/15 AppDirect Wmode 31.9 NA Wmode provides application ecosystem software and professional services to connected device manufacturers, cable and network operators, enterprises, and the spectrum of devices that comprise the Internet of Things around the world.

06/30/15 Cisco OpenDNS 635.0 NA OpenDNS operates as a security company that provides internet security and domain name system services to secure the networks used by people to connect to the Internet worldwide.

06/30/15 Ernst & Young EnteGreat (IoT Consulting Arm) NA NA EnteGreat Solutions offers supply chain consulting and project management services.

06/23/15 Sierra Wireless MobiquiThings 15.7 NA MobiquiThings operates as a mobile operator that provides machine-to-machine multi-operator connectivity options to customers worldwide.

Recent M&A Transactions (continued)




06/18/15 Novatel Wireless DigiCore $1,054.3 1.2x DigiCore researches, develops, manufactures, sells, and supports GPS/GSM fleet management and vehicle tracking solutions primarily in South Africa and internationally

06/17/15 Intel Recon Instruments 175.0 NA Recon Instruments develops and supplies customized solutions for direct-to-eye communications. It integrates micro optics display systems with sensors and GPS technology to provide real-time access to navigation, communication, and performance-based information.

06/01/15 Intel Altera 16,700.0 8.3 Altera, a semiconductor company, designs and sells programmable logic devices (PLDs), HardCopy application-specific integrated circuit (ASIC) devices, power system-on-chip devices (PowerSoCs), pre-defined design building blocks, and associated development tools.

05/28/15 Avago Broadcom 36,697.9 4.0 Broadcom provides semiconductor solutions for wired and wireless communications. Its products offer voice, video, data, and multimedia connectivity in the home, office, and mobile environments.

05/19/15 Continental Elektrobit Automotive 600.0 3.5 Elektrobit Automotive provides embedded standard software solutions for the automotive sector.

05/18/15 Apollo Global Management

Alarm Security Group NA NA Alarm Security provides electronic security solutions. It offers home automation solutions, such as wireless communicators, touch screen panels, temperature control solutions, l ighting and small appliance control solutions, mobile and desktop account solutions, and electronic door locks.

05/05/15 PTC ColdLight Solutions 100.0 NA ColdLight Solutions develops predictive analytics platform. The company offers Neuron, an artificial intell igence (AI) and machine learning technology that builds accurate predictions.

03/30/15 Novatel Wireless Feeney Wireless 25.0 NA Feeney Wireless, an M2M products and services company, specializes in fixed and mobile cellular-based wireless solutions. Its products include modems and mobile gateways; routers; Varasight covert and wireless IP surveil lance products; Device Management System, a hosted Software-as-a-Service platform for M2M applications.

03/18/15 MicroSemi Vitesse Semiconductor 399.0 3.5 Vitesse Semiconductor designs, develops, and markets various semiconductor products for carrier and enterprise networking applications worldwide.

03/17/15 365 Agile Limited Ciseco NA NA Ciseco, trading as wireless things, manufactures electronic components for the Internet of things (IoT) applications. It offers RF modules, power and I/O products, sensors, actuators/switches, gateways, boards and shields, microcontrollers, components, and software, as well as development hardware for Texas Instruments.

03/12/15 Amazon 2lemetry NA NA 2lemetry, Inc. operates an Internet of things (IoT) platform and technology company. Its platform powers the connected enterprise, tying people, processes, data, and devices together, as well as transforming raw data into real-time actionable intell igence.

03/11/15 Square Kil i Technology NA NA Kili Technology Corporation delivers hardware solutions for payment processing, security access control, authentication, and secure Internet of Things (IoT). The company’s solutions include chipsets, certifiable reference designs, payment modules, development boards, and support solutions to enable OEMs to integrate Kil i technology into their own products.

03/09/15 Acuity Brands Distech Controls 252.5 4.5 Distech Controls designs and manufactures building automation systems (BAS) and energy management systems for commercial, institutional, and government portfolios. It offers EC-NetAX, a Web-based BAS that provides integration of HVAC, l ighting, access control, CCTV, energy management, and other building system.

03/09/15 Delta Dore SAS Lifedomus NA NA SAS Lifedomus provides home automation technology solutions. It sells its products through resellers and distributors. The company was founded in 2008 and is based in Vil leneuve-d'Ascq, France. As of 2014, SAS Lifedomus operates as a subsidiary of Delta Dore S.A.

03/01/15 NXP Freescale 11,800.0 3.6 Freescale is a provider of microcontrollers and digital networking processors, commonly referred to as embedded processors. The Company combines its embedded processors with its analog, sensor and radio frequency (RF) devices, and software and design tools, providing integrated embedded processing solutions.

Recent M&A Transactions (continued)




03/02/15 HP Aruba Networks $2,650.8 2.9x Aruba Networks provides enterprise mobility solutions worldwide. It offers access points that deliver secure Wi-Fi cl ient access to indoor and outdoor enterprise wireless local area network environments; and mobility controllers, which manage wired and wireless access across indoor, outdoor, and remotes locations.

03/01/15 Brocade Connectem NA NA Connectem designs and develops wireless device solutions. The company’s software allows users to connect mobile devices to carrier networks.

02/13/15 British Gas Services AlertMe.com 67.7 NA AlertMe.com provides Omnia, an interoperable and open cloud-based platform to connect an ecosystem of devices and appliances to provide services that allow users to monitor, control, and automate their homes in Europe and the United States. The company’s technology combines devices, services, and data in a unified platform for a connected home ecosystem.

02/11/15 Investcorp Bank Arvento Mobil Sistemler NA NA Arvento Mobil Sistemler, a technology company, designs, develops, and manufactures mobile tracking technologies, telematics products, and M2M solutions.

02/10/15 Hitachi Data Systems Pentaho NA NA Pentaho provides data integration and business analytics platforms.

02/10/15 CVC Capital Partners Wireless Logic NA NA Wireless Logic provides machine to machine managed services to system integrators, application providers, and end user clients in the United Kingdom and internationally.

02/04/15 Under Armour MyFitnessPal 474.0 33.9 MyFitnessPal operates a digital nutrition and connected fitness platform. It provides MyFitnessPal Mobile, a mobile application that makes calorie counting and food tracking easy.

02/03/15 Sil icon Laboratories Bluegiga Technologies 60.8 NA Bluegiga Technologies designs and develops wireless connectivity solutions. The company supplies a range of Bluetooth and Wi-Fi modules for audio, automotive/automotive aftermarket beacons, consumer electronics, health and wellness, M2M, industrial, point of sale, smart home, sports and fitness, and other sectors.

02/02/15 Intel Lantiq Deutschland NA NA Lantiq Deutschland, a fabless semiconductor company, provides semiconductors and supporting software for broadband communication and digital home applications. The company specializes in broadband communications, including analog, digital, and mixed-signal ICs, as well as complementary software suites.

01/22/15 Harman International Symphony Teleca 780.0 2.1 Symphony Teleca creates and commercializes SaaS/cloud enterprise software, mobile products and solutions, big data and analytic services, and integrated enterprise solutions to ISVs, mobile device and solutions manufacturers, and the connected analytics-driven enterprises.

01/20/15 Intel Composyt Light Labs NA NA Composyt Light Labs develops smart glasses with an ultra-compact wearable display that integrates discreetly with normal eyewear, enabling a new generation of aesthetic smart glasses.

01/14/15 Semtech EnVerv NA NA EnVerv, a fabless semiconductor company, provides System on Chip (SoC) solutions for smart grid, metering, and control applications in the United States and internationally.

01/07/15 Silver Spring Networks Detectent 12.0 NA Detectent provides SaaS-based analytical software solutions for advanced metering infrastructure and util ity grid operations. It offers Customer Intell igence Platform, a solution that integrates customer-related information from various sources, and transforms data into information util ities providing customer intell igence

75th Percentile $985.7 4.3xMean 3,508.0 6.4Median 325.8 3.525th Percentile 62.5 3.0

PRIVATE PLACEMENTS

Recent Private Placement Activity


Date Investors TargetLast Round Raised ($M) Target Business Description

09/14/15 Summit Partners; Intel Capital; Panorama Point Partners

WebAction $20.0 WebAction develops and operates Stri im, a platform that combines streaming data integration and streaming operational intell igence.

09/10/15 Berger Associates Syncano 5.5 Syncano develops a Data-as-a-Service platform that enables users to build Internet of Things-ready apps with real-time synchronization.

09/03/15 MuckerLab Wireless Sensor Technologies 0.3 Wireless Sensor Technologies develops software and hardware solutions to service companies deploying Internet of Things projects.

08/28/15 Lunds Universitets Innovationssystem Mistbase NA Mistbase is sdelivering a wireless communication solution in the field of Internet of things (IoT).

08/27/15 Inventure Wirepas 2.3 Wirepas provides wireless communication solutions to connect Internet of Things (IoT).

08/21/15 Fanuc Preferred Networks 7.4 Preferred Networks operates as a software development company that focuses on applying real-time machine learning technologies to new applications in the emerging field of the Internet of Things.

08/20/15 Blu Venture; Maryland Venture Fund; TEDCO Capital Partners; Veterans' Opportunity Fund

Link-Labs 7.2 Link-Labs builds machine to machine low-power wide-area network technologies for the Internet of Things (IoT).

08/07/15 Legend Star; MediaTek Ventures; Tiger Cub Funds

Shenzhen ORVIBO Electronics 12.6 Shenzhen ORVIBO Electronics focuses on developing IOT and smart hardware products.

08/05/15 Bessemer Venture Partners Bastil le Networks 9.0 Bastil le Networks develops software and sensor technologies to detect and mitigate threats affecting the Internet of Things (IoT).

08/04/15 First Round Capital; Lerer Hippeau Ventures; Formation8 Partners; Pritzker Group Venture Capital

Augury 7.0 Augury provides a platform that enables facil ity owners and service companies to deploy predictive maintenance strategies.

07/22/15 Parker-Hannifin Exosite NA Exosite designs and develops a cloud-based data platform that enables Internet of Things (IoT) and machine to machine (M2M) solutions.

07/15/15 Tsinghua Unigroup International Acadine Technologies Holdings 100.0 Acadine Technologies Holdings operates as a systems software company that specializes in mobile operating systems for mobile, wearable, and IoT devices.

07/13/15 CrunchFund; Earlymarket; Rubicon Venture Capital; Startup Capital Ventures; String Ventures; ZenShin Capital Partners

iotera 1.0 Iotera develops a wireless technology for tracking objects. The company’s solutions include electronic tags that provide communication and geolocation capabilities; and a child tracking application service that is attached to a backpack.

07/06/15 North Cove Partners; 101 Startups; Wayra UnLtd; Toubkal Partners

Next Big Thing Labs 0.3 Next Big Thing Labs operates an online platform that provides an Internet of Things (IoT) backend solution for developers with API.

07/01/15 Relay Ventures; Sapphire Ventures; Scale Venture Partners

PubNub 20.0 PubNub provides cloud-hosted messaging service for building real-time Web and mobile applications.

06/22/15 Finistere Ventures; Innovation Endeavors; GreenSoil Investments

CropX 9.0 CropX uses advances in the Internet of Things (IoT) and big data to transform traditional farming techniques. CropX is an ag-analytics company that has developed advanced adaptive irrigation service, which automatically optimizes irrigation, thereby delivering dramatic crop yield increase and water and energy cost savings to farms.

06/22/15 Suma Capital, SGEIC Carriots NA Carriots provides a Platform as a Service (PaaS) for Internet-of-Things and machine-to-machine projects.

Recent Private Placement Activity (continued)



06/16/15 IDInvest Partners; Bpifrance Investissement; Foxconn Electronics; Swisscom Ventures; Orange Capital; Ginko Ventures

Actil ity $24.7 Actil ity develops ThingPark, a machine-to-machine communication platform, designed for massively scalable deployments of mission-critical applications.

06/12/15 Infinity Venture Partners; Wil LLC SORACOM 5.7 SORACOM operates a communication platform for to connect busines-to-bussines and consumers by way of the IoT (Internet Of Things).

06/11/15 Charnov Family; International Investment & Underwriting; LG Electronics

decaWave 4.5 decaWave, a fabless semiconductor company, engages in the architecture and design of integrated circuits for communications equipment markets. The company specializes in ultra wideband technology for real time location systems and wireless sensor networks.

06/10/15 hub:raum EmtoEmgo Unternehmergesellschaft NA EmtoEmgo Unternehmergesellschaft provides a cloud based content management system for M2M.

06/08/15 Atomico Investment Holdings; BHLP; Cisco Investments; Dawn Capital; Samsung Venture

Evrythng 7.5 EVRYTHNG provides a software engine for creating Active Digital Identity (ADI) profiles for physical objects on Web. The company’s solution provides technology, tools, and services to create ADI profiles for products and other types of objects.

06/02/15 Blumberg Capital SQream Technologies 7.4 SQream Technologies provides a big data analytics SQL database for organizations.

05/21/15 Aldin; Foxconn; Ginko Ventures; Orkos Capital; Swisscom Ventures; Robolution Capital; Swisscom Ventures

Piq 5.5 Piq develops and manufactures devices to measure and compete in sports.

05/19/15 Reuben Brothers; Swordfish Investments; Visionnaire Ventures

GOFACTORY 2.0 GOFACTORY provides an IoT platform that enables industry and enterprise customers to connect their assets to their workforce. Its platform connects physical assets, devices, sensors, systems, vehicles, and people to drive intell igent action; allows users to gain real-time insight into asset status, location, and who currently has responsibil ity for it.

05/14/15 White Star Capital; McRock Capital Mnubo 6.0 Mnubo provides smart data management and analytics for Internet of Things (IoT) for enterprises, service providers, and device manufacturers. Its cloud platform enables OEMs to connect, collect, analyze, and act on their object data to deliver insights, intell igence, and applications.

05/11/15 Kleiner Perkins Caufield & Byers; Metamorphic Ventures

Mode 0.8 Mode develops a cloud platform that enables users to develop and operate their Internet of Things products. Its platform lets customers’ devices communicate with their mobile clients, and helps to track and manage their devices and users.

05/05/15 Andreessen Horowitz Samsara Networks 25.0 Samsara Networks develops Internet connected sensor systems that combine plug-and-play sensors, wireless connectivity, and cloud-hosted software integrated for deployment.

04/27/15 500 Startups MoBagel 0.1 MoBagel provides a cloud based software for device analytics on smart things. It offers meeti, a Web portal that implements multiple encryption to the data that users send and receive, as well as visualizes Internet of things.

04/27/15 In-Q-Tel Atlas Wearables 1.5 Atlas Wearables provides a fitness monitor/activity tracker that identifies exercises, counts reps and sets, calculates the calories burned, and evaluates the users’ form and offers data analytics services.

04/23/15 Hartford Steam Boiler; Tyco International; Navitas Capital

Waygum 2.0 Waygum designs and develops an industrial level mobile development platform which allows users to build and deploy Internet of Industrial things integrated mobile applications.

04/15/15 Iris Capital; CREATHOR VENTURE Management; Iris Capnamic Management

COBI 4.0 COBI develops and markets connected biking systems to digitally upgrade bicycles to smart bikes. It offers package solutions for upgrades of bicycles, comprising hardware and software elements for bike OEMS, retailers, and service providers.

04/14/15 Robert Bosch Venture Capital; DFJ EspritCapital-E; AIB Seed Capital Fund; Atlantic Bridge; Sunny Optical Technology

Movidius 40.0 Movidius operates as a computational image-processor chip and software company. It offers computational imaging chipsets that enable smart capture and continuous vision processing applications for mobile devices.

04/08/15 Pelion Venture Partners; Akamai Technologies; Third Point Ventures

Rubicon Labs 11.7 Rubicon Labs is a cybersecurity company that develops secure communication technologies for cloud-based data centers and the emerging Internet of Things (IoT) market. The company offers an IoT Security Platform that is a cloud-based key provisioning and key protection platform for securing IoT devices.

Recent Private Placement Activity (continued)



03/26/15 KPMG Flexeye $4.5 Flexeye plans, designs, develops, deploys, and supports platforms for operational intell igence and Internet of Things. The company offers Enterprise Metrics Platform, a platform that gathers and delivers OI about various assets, such as plants, buildings, people, computing equipment, and control systems for an organization.

03/26/15 Brook Venture Partners Security Innovations 4.0 Security Innovations provides security solutions for enterprise applications risk profiles. The company offers TEAM professor, a computer-based training for technical and awareness training; and TEAM mentor, a real-time, secure development reference guide.

03/24/15 T-Venture Holding; BDC Venture Capital; Relay Ventures

Mojio 8.0 Mojio provides a cloud-connected cellular and GPS device that connects to various cars for insights into what’s happening under the hood and behind the wheel. Its Mojio includes a way to safely connect–or reconnect–with family and friends while a client is on the go through personalized prompts, messages, and geo-location features and a virtual driving assistant.

03/18/15 Bessemer Venture Partners; Rho Capital Partners Comcast Ventures; Industry Ventures, LLC; SingTel Ventures

August Home 39.0 August Home operates as a home automation company that develops and offers August Smart Lock, an encrypted locking technology. The company’s technology manages home locks using a smartphone and computer.

03/12/15 Emertec Gestion; Orkos Capital SAS EnerBee 1.7 EnerBee develops motion-based generators/energy-harvesting solutions to power smart devices replacing batteries in industrial and consumer connected objects.

02/24/15 IDG Ventures; Ignition Partners Tempered Networks 20.1 Tempered Networks provides connectivity solutions for critical infrastructure, industrial control systems, and the Industrial Internet of Things applications in water, energy, petroleum, manufacturing, and other industries.

02/19/15 NextView Ventures; MuckerLab; Maiden Lane Ventures

Konekt 1.3 Konekt develops and delivers cloud based Internet connectivity solutions for IoT device management and network connectivity. Its solutions enable makers, OEMs, and systems integrators to build devices that connect to the Internet with cellular connectivity.

02/18/15 Mobile Ventures PipesBox NA PipesBox UG develops a platform for smart homes and the Internet of things for end users.

02/11/15 Intel Capital; Bpifrance; Bpifrance Large Venture; Ell iott Management; Eutelsat; Air Liquide

SIGFOX 115.0 SIGFOX, a cellular network operator, provides cellular connectivity for Internet of things and machine-to-machine communications in France and internationally.

02/11/15 Angel Prime Nimble Wireless 0.5 Nimble Wireless provides machine-to-machine (M2M)/Internet of things that help customers wirelessly connect, control, and manage their remote assets. The company offers Toucan-P, an asset tracking device for asset monitoring, package tracking, and covert tracking; and Toucan-PT, an asset tracking device with a panic button for asset monitoring and package tracking.

02/04/15 Baidu ShenQi 100.0 ShenQi manufactures and offers online retail of smart phones, as well as Internet connected home devices. The company was founded in 2014, and is based in China. ShenQi operates as a subsidiary of Lenovo Group.

01/26/15 Carrier Corporation ecobee NA ecobee delivers intell igent energy management solutions that enable residential and commercial customers to understand and reduce their energy consumption. It offers Smart Thermostat, which is internet enabled through Wi-Fi to monitor and manage home comfort; and Smart Si thermostat that allows to make adjustments to the thermostat on the go from tablets,phones, etc.

01/21/15 Bessemer Venture Partners Bastil le 2.5 Bastil le Networks, a security company, develops software and sensor technologies to detect and mitigate threats affecting the Internet of Things (IoT).

01/12/15 Andreessen Horowitz LLC; Cherubic Ventures; Foundation Capital; Google Ventures; Menlo Ventures

Percolata 5.0 Percolata provides cloud-based workforce management applications and sensors in the United States, Europe, and Asia. The company helps retailers’ store operations by providing access to real-world data online.

01/09/15 Salesforce Ventures 2lemetry 4.0 2lemetry operates an Internet of things (IoT) platform and technology company. Its platform powers the connected enterprise, tying people, processes, data, and devices together, as well as transforming raw data into real-time actionable intell igence. Acquired by Amazon on 03/12/15.

WCP Contact Information

Kirk Bloede

NewforthSilicon Valley Bank

Smith BarneyBank of America

MBA, HarvardBA, Stanford

[email protected]

Amar Senan

Volpe Brown Whelan LM Ericsson

Australian AirlinesKestrel

Ixia

MBA, GlasgowBSc (Econ), LondonBEng, MEng, RMIT

[email protected]

Greg Mischou

Alex BrownUBSIntel

Engemann Asset ManagementDigital Equipment

MBA, Carnegie MellonBSc (Eng), Northeastern

[email protected]

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Shusaku Sumida

Silicon DynamicsOki Semi USA

Oki Hong KongOki Electric

BE, KyotoDip. Ohmae GSB

[email protected]

Silicon Valley Offices1950 University Ave, Suite 150Palo Alto, California 94303Tel: +1 650 513 2775

UK Offices7th FloorRiverbank House2 Swan LaneLondon, EC4R 3TTTel: +44 207 929 0248

Silicon Valley and UK Presence

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The Internet of Things – Market Update

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