Is smart home domestic market worth investing?

Although smart homes have been in China for 12 years, the media and the general public have had a certain understanding of smart homes, especially in the last two years. With the arrival of the Internet of Things, smart homes are the closest to common users in Internet of Things applications. The application has received extensive attention, but there is still a great deal of information asymmetry in understanding the current status and prospects of smart homes. Many investors hesitate to invest in smart homes. Is it worth it?

First of all, all people are optimistic about the smart home tomorrow, but only a few people are optimistic about the smart home today, or that only a few people face the smart home today. Both the mass media and the ordinary consumers are fond of the super dazzle function of the smart home demo, but at the same time, they think that they are far away from their own lives and they are listed as sci-fi. The result of such propaganda is that the public has remembered smart homes, but it has not stimulated the consumption of smart homes, and this concept has apparently been transmitted to the investment circle. Among the more than 50 investors who have contacted the most recently, most of them talked about When smart home, the first reaction is "good products, good direction, etc. There should be good investment opportunities in 35 to 35 years." In other words, they all think that smart home is a product with good development prospects, but the consumer demand market Not yet up, there is no investment value in this area.

Our conclusion: The investor's understanding is one level with the media and the average consumer. This is not a question of the level of competence. It is a lack of detailed research on the smart home industry. There is no detailed survey and analysis data, and investment returns cannot be said naturally. After two years of smart home heating, smart home market analysis and research reports have skyrocketed. However, there are several companies that know the exact market size data of smart homes. Several companies understand the difference between smart homes and smart home appliances and write reports to write them. The report puts together seemingly relevant data and data. Investors buying such a report can only come to the conclusion that the industry has not been formed and what data is unclear, and they have lost interest in investing in this industry sector.

Second, smart homes do not lack early investment, but lack the investment in the middle and later stages. This is still due to information asymmetry. Smart home entrepreneurs and some early investors have seen great market opportunities: On the one hand, the future prospects for smart homes are very good. On the other hand, there is currently no dominant brand of smart home products. This has given rise to newly established companies. Opportunity to become an industry leader. As a result, smart home entrepreneurial teams were established one after another. Most of them were self-financed, and some companies also obtained private investments ranging from RMB 300,000 to RMB 10 million. These investments were made by angel investors in the early days of smart home companies to the industry. Infused with valuable funds. However, venture capital, strategic investment and other capitals are rarely involved in this industry sector.

The same smart home, why foreign companies can get a lot of risk investment? We can see that there have been four investments in smart homes in the United States in the past year:

1, July 2012, engaged in Internet-based smart home security and energy management company Alarm. Com, recently also received $136 million in financing. Investments in the company in recent years include Alarm. ABSCapital, EquisCapital, including comCEO.

2. In March 2012, the smart home company Control4 received a sixth round of venture capital investment of US$17.3 million. This round of investment was jointly invested by seven investment institutions such as BestBuyCapital, MercatoPartne and UniveityVentureFund. As a result, Control4’s accumulated risk investment has reached nearly RMB1 billion. U.S. dollar, the strong promotion of venture capital, has also enabled the rapid development of smart homes in the United States.

3. ElectricImp is a newly established smart home company that promises to convert almost all home appliances into connected devices by adding a tiny chip to the card slot. Use this chip to help users monitor, control home devices, and keep abreast of device information. It received 7.9 million round A funds from investment companies Redpoint Ventures and Lowercase Capital.

4. On June 20, 2011, the iControl Network, a provider of smart home management software, received a $50 million investment in the fourth round of financing. At present, the iControl network has received more than 100 million U.S. dollars in total financing. Companies participating in this round of investment in the iControl network include: Comcast Ventures, a cable provider Comcast Comcast, Intel Ventures, Cisco, KPCB, telecom operators Rogers and Tyco International.

Is there something happening in domestic venture capital institutions that formally invests in smart home companies? It has not been heard so far.

Is the domestic smart home business not good enough? This issue is very sharp, but after four years of continuous brand monitoring and analysis of 43 smart home companies active in the Chinese market, thousands of consultants can conclude that there are about 10 domestic smart home companies that have very good Of the investment prospects, there are also three or four of the most worthwhile investments. What's more interesting is that smart homes are an industry sector where independent intellectual property rights are relatively concentrated. This is also an important weight for companies to stay competitive. In separate communication with several venture capital institutions, we have also provided sporadic information on smart home companies. However, this information is obviously not complete, and it lacks comparative analysis. It is obviously not convincing and we are aware of this problem. So starting last year, we started a project to write professional reports on smart home investment intelligence analysis. We hope to look at the industry from the perspective of investors to explore the business opportunities in this market.

We know that one thing investors think about when they look at the industry is: When is the right time to enter. At present, there is no capital for early investment, A round of investment has not yet appeared, are waiting for the B round or even later to enter, or waiting for the listing before the bustling? We are fully aware that these attempts are of little significance. As a smart home industry company, to do a good job of products and do a good job in the market, the considerable amount of sales and profits is the real investment in gaining investment. China does not have the same mature intelligence as the United States. The high-tech venture capital investment environment, including home, can't hold much hope in the short term. Staring at customers in the eyes, how to do good products and services is the key.

Of course, there are things to be gratified. After all, capital is approaching this industry sector. Although smart home manufacturers are still difficult to obtain venture capital, the entire industrial chain of smart homes is attracting more and more funds, according to thousands of consultants 2012. The “2009-2020 China Smart Home Market Development Trends and Investment Opportunities Report” formally released on August 6th, apart from the uncertainty in ordinary residential smart home applications, subdivided villa luxury home smart home and public decoration intelligence. Homes, hotel room control systems, and smart communities have all experienced rapid growth. A group of companies focused on market segments have received very good returns. Participating in these market segments has attracted competition from multinational corporations such as Legrand and ABB. Their financial strength guarantees that these segmented areas will be developed rapidly and healthily; operators are strongly entering the field of smart home and energy management operation services, bringing not only the growth of product sales, but also the application of universal and commercial The innovation of the model, in this regard, the State Grid has arranged a large amount of investment A beneficial pilot; home security operations have become the most important area for smart home and security listed companies to plan, this application field will be born a group of outstanding companies, of course, will inevitably become a field of stock market themes speculation; Finally, smart home E-commerce is also facing an icebreaker, whether it is the Gome mode or smarthome. The com mode or the Taobao mode is full of imagination. You should know that at present Taobao searches for “smart homes” and can find more than 8,000 babies. Smart home e-commerce is moving forward in a way that we did not anticipate.

Smart homes are worth investing in, whether abroad or in China.

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