Start-ups are transforming homes with products such as smart locks, doorbells, and lighting, along with products to kit out homes for pets and babies, and much more. Technological advances are being rapidly integrated into our homes, more focus is put into developing more products that would be user friendly and useful for different home situations. This article covers the business environment and investment trends associated with this sector of the economy.
According to a report published by RedSeer Consulting, Home automation market in India is rapidly growing and is expected to reach INR 8800 crores by 2017. The key growth drivers for this demand include increasing consumer awareness and financial ability, product innovations (like smart phone apps), builders’ requirement for market differentiation and an increase in the preference for energy efficient systems.
There is no real statistics on the market size: This seems to be a major problem. Nobody know the real market size of this sector. There are only estimates for this data and this poses a lot of problem for everyone.
There is a need for integration between subsectors: After the coordination done by one subsector, there is a need for integration between other subsectors. This is a problem that impedes the progress of the market. Coordination isn’t enough. There should be a step forward towards this for better progress in this sector.
People are not too informed about this market: This problem arises from lack of awareness. Even the aware people need to be kept abreast of the changes and development that arises in the use of these smart technologies.
Technology flops can be discouraging.
There is a need for integration between subsectors: Unhealthy competition causes this shift in the attention of consumers. There is a need for a collaboration between smart providers on this. But we aren’t there yet when it comes to this. This has caused a rift between the choices consumers have to make and the some even prefer to stay away from this sector till there is a form of stability.
Technology flops can be discouraging: This is a general problem with technology. Sometimes it can be bearable. Some other times, it becomes hard to decipher the problems caused by the flops. For an investor, this can be a bad egg and might prevent investment.
People are not too informed about this market: Usually, awareness is what sell a product or a market. The use of more social apps and media should be encouraged. Not like this isn’t being done, but there should be a focus on what the consumers/investors want to know about this sector, this focus should drive the adverts and broadcast that they’re exposed to.
There is no real statistics on the market size: This is a big drawback here. The lack of data causes a loss of investors and this drives away potential start-ups.
730+ companies in the sector, 215 funded in last 5 years, $973M invested in 2015/16 Western Technology Investment, American Family Ventures, Kima Ventures are the most active investors. There are 3 subsectors here.
Home Automation: Devices that automate and give the user control over some home device. There have been 456 registered companies founded in the past 7 years. With a funding amount of $810M There are 5 categories in this sub-sector. They are:
Connected Device Management: Control system hubs and Apps for home devices.
Monitoring: Devices that automate monitoring solutions.
Smart Switches & Plugs: Devices that allow remote control of switches & plugs primarily for energy efficiency.
Gardening: Devices targeted at home automation for gardening.
HVAC Control: Solutions for monitoring and controlling HVAC devices.
Home security: Home security systems that monitor house and give user wireless control over safety devices like locks, video camera etc. There have been 127 registered companies founded in the past 7 years. With an overall funding amount of $437M. There are 3 categories here:
Video Monitoring & Alerts: Video monitoring solutions that use the cloud to host the feed and possess some form of recognition.
Access Control: Solutions to control external access to home.
Home Network Security: Device to ensure home network security from external threats.
Smart Home Suite: Companies providing range of home automation solutions. There have been 38 registered companies within the last 7 years. With an overall funding amount of $1.19M.
This sector promises a lot of benefits, as technological innovations come to the rise, more start-ups are going to be involved with providing these services to more homes. The major focus that should be shown is in the need pay off section. More investments would bring about more start-ups and this would greatly increase the products that come to the market.