One very healthy sign of an emerging market is lots of wild and wacky startups and the IoT is not disappointing us. In an earlier post on the IoT landscape I noted that there were dozens of companies I hadn't heard of and I think the surge of Kickstarter and bootstrapped companies bodes well for the IoT market. Now history tells us that 90%+ of these companies will fail but the true art in being an investor or analyst is finding those 2 or 3 that will break out of the sub $1m category and become viable players. A lot of IoT startups are pursuing interesting applications but only a few have picked markets that can scale and generate real profits. Another pitfall for many startups is that they pursue an application or market that is easily co-opted into an existing hardware or software product leaving them vulnerable. Automatic comes to mind; I have ordered this device which plugs into the OBD port of your car so you can track usage and performance and I hope to get mine soon. Unfortunately I think they are vulnerable because car manufacturers could easily include this feature in their cars in the future and where does that leave Automatic?
An under the radar IoT application is the industrial market and I think it has huge potential and even though GE, Honeywell, Siemens and Schneider are all over it there is room for innovation. So when I saw this company pop up http://www.equipstick.com/index.php I took a look. Equipstick seems to have the right idea in that their device attach's to existing machines and then reports on their performance. There is a huge installed base so this has the potential to grow and make a difference. My earlier comment still holds in that new industrial equipment will likely have this functionality built in but there are so many applications and legacy equipment out there for them to be successful (as compared to 10 car companies). Looks like Equipstick is still in beta but I will try to get a device and blog on it.
As a postscript just wanted to update you on my IoT investment index and as of 11am PST this morning its up 2.19% since I launched it 3 weeks ago (not bad!); here it is: http://dblaza.blogspot.com/2013/06/how-to-invest-in-internet-of-things-my.html
If you have seen some cool startups recently please add a comment below and we will take a look.