A VC’s view on IoT: Everything is changing… still

The Internet of Things (IoT) is a fundamental shift in our world – but it is not the first shift we’ve seen of this magnitude. IoT is our fourth industrial revolution. As with all others, it will create winners and losers. One loser may be the hardware model, as software models emerge powerful and sticky – with commoditizing hardware only serving to stretch the reach of software. Under this threat, many hardware companies are seeking software models, and some hardware giants are investing in software startups to get ahead of the wave.

There will also be unintended human consequences of the IoT paradigm shift. It will both solve problems and create new ones… an entrepreneur’s dream. Below is one view on the IoT – what it means to entrepreneurs, investors and all of us as humans.

I am lucky to be on this ride with our portco, TempoIQ, which started my thinking on this.

8 thoughts on “A VC’s view on IoT: Everything is changing… still

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  2. Guy – Great post. I really like the analysis. What are your thoughts on the value created by a more full-stack or vertically integrated solution versus a PaaS solution.

    1. Corbett, great question. I think whether a SW company should play from the bottom to the top is driven by whether their customers lack the expertise or time to integrate solutions across the vertical themselves. For example, if you play in one layer but sell to tech centric companies (SW or data companies with hoards of engineers), they can probably integrate layers themselves. Indeed they may prefer to so they can get exactly what fits their needs and setup a custom solution that fits best with their current stack.

      But if you’re selling an IoT solution to a coffee maker company – that isn’t expert in SW/data – they might really value a full stack solution.

  3. Nice job on this presentation Guy. The main point is there are going to big winners (and losers) as the IOT continues to develop. HPVP is doing a great job in trying to identify the winners.

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