Slava Solonitsyn is a partner at Ruvento Ventures, a seed fund based in Singapore that funds teams across the USA and Asia, and he gets paid to hear from startups that are developing ideas at the frontier of AI, IOT, and robotics – are you jealous yet? At the Startup Launchpad Future of Retail Conference and Trade Show that went down a couple weeks ago, we were lucky to hear from Slava as he spoke earnestly about how startups should interact with the processes and technologies interrupting all industries. As an investor with his eye firmly on the trends of the future, he offered precious insight to startups on how they can appeal to capital ventures that want to put their money toward forward-thinking companies. His talk, “How Should Startups Embrace the Trends of IoT and Big Data?,” is outlined below, but be sure to check out the video of his engaging talk on our Facebook page.
Know the Trends and Funding Patterns
The first point to remember is that no matter a startup’s product focus, there exists an opportunity for that startup to integrate IoT and Big Data concepts in its products and business model. Successful technology applications are found in a range of industries and fields, including smart home, energy, health, manufacturing, retail, surveillance and agriculture.
However, we can’t possibly talk about the various types of what Slava calls ‘frontier startups,’ startups that are working on the technology of the future, without mentioning which ones are receiving most of the funding. The companies receiving top-funding (those that are raising hundreds of millions of dollars!) in the field of IOT platforms are those that are developing IOT networks and infrastructure (think mesh networking, which means connecting spaces in between existing wifi hot spots and cell towers), software models, security IOT, and hardware related to IOT. Ayla, an IOT platform that supports device connectivity and device management across multiple platforms, and serves as a web and mobile framework, is a good example of an IOT platform that raised over $100 million USD due to its wide range of applications and ability to fill a gap in the market.
Startups will not find success in attempts to recreate the wheel; they should know what other companies are working on, and get to know a little bit about how their technology works. Learn what platforms the companies you admire are using, and see how you can integrate them into your business model. This will save precious time and startup costs.
How are Capital Investments Moving?
Before startups dedicate too much time to developing a product, it is important to have an idea on the likelihood of receiving the ever-so important funding necessary to sustain growth. Audience members were likely surprised to hear that venture capital investments in Big Data are greatly declining. However, AI, machine learning, and deep learning startups face a different story. Investments and interest in AI is increasingly growing as industries of all kinds are driven to increase computing performance and improve image and speech recognition to design products that are more able to infiltrate all parts of human life. Think Amazon’s Alexa, a smart speaker that aims to be your in-home virtual assistant in all things online shopping, music control, stock trading, and home automation.
Startups Must Adapt to the Future
Most wildly successful startups nowadays do not exclusively focus on traditional hardware, but have at least some software integration. For example, Ring is an Amazon-owned global home security company that uses motion-based video cameras and doorbells to allow users to monitor visitors to their home from anywhere with a network connection. What has made Ring so successful is it’s integration of trends such as IoT and facial recognition into a product that many consumers will utilize each day. Nowadays, consumers desire constant connection and ability to monitor their home remotely, and smart home products like Ring can provide this assurance. Consumers are also after collecting data from all facets of their lifestyle, including from their body. Within Ruvento Ventures’ portfolio, Eight Sleep is a mattress cover that tracks sleep patterns and quality. Ruvento also invested in Naked Labs, a startup that created a body scanner that provides body fat, weight, and muscle tone measurements, tracks these measurements over time through an app, and provides useful visualizations to keep users on track with fitness goals.
If startups can figure out how to provide useful and desirable data to an end user through software, they have a better chance of making a product quite palatable for the market and investors. Once you have a software component built within your startup, you can also start thinking about embracing a subscription model for your product’s services. Selling subscriptions is a great way to ensure continued revenue as long as you can provide updated content and a consistent service.
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