It's All Connected

Today we're diving deep into the Internet of Things ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌
June 26, 2022 Read in Browser

TOGETHER WITH

Good Sunday morning. Before we get into it, today's Deep Dive is brought to you by StartEngine.

 

Here at the Upside, we always have our ears to the ground searching for the most powerful trends moving markets (regardless of the cycle) and shaping the investment climate.

 

So when we read about StartEngine's performance stats over the last few years, our ears naturally perked up. We'll name just a few:

  • StartEngine has doubled revenue each year for three years straight from $4.3 million in 2019 to over $25 million through November 2021. (1)
  • 90% increase in prospective investors, with 750K active users. (2)
  • In 2021 alone, StartEngine raised over $252M for issuers on the platform, with a target to raise a total of $10 billion by 2029. (3)

So, What's Working? StartEngine is capitalizing on two fundamental shifts 1) regulation change in favor of democratized investing and 2) a massive uptick in interest for alternative funding amidst the VC pullback (StartEngine has seen a 2x surge in applications to raise capital on the platform in 2022).
 

With that kind of momentum, they have garnered the support of strategic advisor, Kevin O'Leary. At the helm day-to-day is Howard Marks, the co-founder of Activision (NASDAQ: ATVI), with a proven track record of building multi-billion dollar platforms.

 

After their biggest year ever, you have a chance to invest in their latest funding round.

 

Get the full details here.

 

And now on to the main event.

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It's All Connected
Fifteen years ago, a refrigerator was just a refrigerator. An oven was just an oven. Lights turned on with the flick of a switch or, in some infomercial-gullible households, a clap of the hands.


Today, nearly every new household appliance — from thermostats to coffee makers — is far more than meets the eye. Some new smart fridges, for instance, can provide a real-time view of what's inside from AI-enabled cameras accessible on an app, keep track of expiration dates, and make recipe recommendations based on what food is on hand.

 

Indeed, most appliances today are "connected," and not in the same sense as in The Sopranos. Rather, they're part of an ever-increasing web of internet-enabled devices capable of "talking to" both humans and other devices. In business vernacular, this trend is called the Internet of Things, or IoT.

 

And that's what we're looking at in today's deep dive — the converging network of disparate but compatible systems, technologies, and devices. Useful for far more than keeping yuppies' kale fresh, we'll examine the practical ways IoT is reshaping businesses and look past the
hype to illuminate the most impactful use cases. Let's dive in.

 

Thanks for Something
Because of the Internet of Things, a 130-year-old, pre-war English Tudor with no central air-conditioning is easily and affordably renovated into a "smart home."

 

In the broader economy, the Internet of Things is helping unlock efficiencies in practically every industry imaginable. Economists and highly-paid consultants have categorized IoT under the more general umbrella of "Industry 4.0," essentially the fourth phase of the industrial revolution where an intelligence and analytics layer is built on top of the computerization that defined the last two decades.

 

McKinsey estimates IoT will unlock a staggering $5.5 trillion to $12.6 trillion in value by 2030. Sure, a wide enough range to drive a sensor-equipped truck through, but at either end it's a massively disruptive force in the economic arena. Like many innovations, the impact of IoT is likely to be concentrated within a few specific industries. And many have zeroed in on industrial factories as a leading adopter of IoT best practices.

Built Ford Smart: Consider the example of Ford's manufacturing site in Essex, UK, which recently partnered with Vodafone to launch a private 5G network to optimize the manufacturing of electric vehicles.

 

There, battery welding machines play home to sensors that gather data and protect against manufacturing defects and battery contamination. If an error is detected, the machines automatically alert a human operator, who, in turn, uses augmented reality to interface with an expert engineer who can triage the issue from hundreds of miles away. Even in that seemingly narrow use case, huge efficiencies are created:

  • Each battery in an electric vehicle requires over 1,000 individual welds, and the machines generate ~250k data points (impossible for a human to sift through).
  • The automated process will create a huge uplift in caught defects, improving vehicle safety and eliminating costly recalls in the process.

That, in a nutshell, is the promise of IoT. While the pandemic forced the world to operate in a tech-first and removed environment, the slapdash transition was merely a practice run for what's to come. In a 2021 IoT Enterprise Survey conducted by tech consultancy firm Omdia, 70% of companies said they expected IoT to become increasingly important in the coming 18 months. Roughly 66% would spend up to $5 million building out IoT strategies.

Welcome to the Fifth Generation
Conceptualizing IoT is easy. Understanding the infrastructure that makes it possible is much harder. The internet is not a perfect freeway system where traffic always flows smoothly. And, with each passing day, there are more devices than ever, transmitting more data than ever, clogging up the internet roadways. IoT will only make matters worse. By 2025, the total number of internet-connected devices could reach 42 billion, according to a report from research company IDC. Your old dial-up router just shrieked.

 

As we increasingly move every aspect of our lives (and our businesses) to the internet, we may be completing tasks more efficiently in real life, but we're taxing the network in the process.

 

Thankfully, the advent of fifth-generation (5G) broadband means a new network that can actually handle the workload is slowly falling into place. While a public rollout is moving slower than expected, a couple hundred large businesses, including Ford, and public bodies, including the military, are deploying private 5G networks to accelerate their transition to a world run through IoT. With access to 5G, processing speeds are expected to reach new heights:

  • 5G speeds have proven to decrease latency compared to the current 4G LTE standard by as much as 10 times. Connection density — a term used to describe the internet capacity of hordes of devices packed into relatively small areas, like the 100,000 smartphones in a football stadium — is also up 10 times, according to Digital Trends.
  • Traffic capacity and network efficiency, meanwhile, have proven to increase by 100 times on 5G connections, Digital Trends also found.

It's a massive technological revolution waiting to happen. A PWC report last year projected productivity and efficiency gains from 5G may add $1.3 trillion to the global GDP by 2030. According to a Brookings report published in 2019, the adoption of 5G technology into the broader economy could create an additional 2.2 million jobs.

 

Hiccups: Without doubt, IoT remains in its infancy stage. The wider rollout of 5G broadband networks has been slower than expected because 5G requires far more equipment than current networks. While cell towers are currently placed every ten miles or so, 5G wavelengths only travel about 1,000 feet. That means 5G cell towers and antennas will need to be just about everywhere and, in major cities, every odd traffic light, lamppost, billboard, or rooftop may be affixed with transmitters. A mini computer in every IoT device also means working out of the global backlog of semiconductors.

Companies to Watch
The faster and more reliable networks ushered in with 5G are poised to open use cases that were simply not actionable in legacy networks. For healthcare, in particular, the potential applications hold promise for many of the core pain points: cost, access, and data.

 

Of course, there are consumer-facing solutions that big tech is pouring into, headlined by Apple's Apple Watch, Alphabet's $2.1 billion acquisition of Fitbit last year, and the launch of Amazon's Halo Band in August 2020. To varying degrees, the devices track everything from body temperature, heart rate, sleep habits, and body fat. Depending on a user's health care system, they can share some of that data to their electronic health records.

 

Healthcare monitoring extends far outside everyday-fitness wearables. In the realm of diabetes care, companies like Dexcom and Roche are offering constantly-online wearables as an effective mode of continuously tracking blood sugar levels. Other wearable devices even automatically administer insulin. Devices monitoring heart health and detecting heart disease have taken off as well. One startup, AliveCor — whose heart-monitoring band is the first FDA-approved, Apple Watch medical-device accessory — has raised over $150 million, according to Crunchbase. Intuitive Surgical, which develops robots for minimally-invasive surgical proceedings, has increasingly integrated IoT systems into its products. Like many tech companies, its stock exploded during the pandemic. Last year, it generated nearly $6 billion in revenue.

 

In the industrial realm, Honeywell is quickly transforming into an industrial-software hybrid company primarily through its Honeywell Forge, a suite of software offerings that correspond with sensors, panels, cameras, and other industrial hardware products it sells. In its latest quarterly earnings report, German industrial giant Siemens said its IoT-focused Digital Industries and Smart Infrastructure units made over €4 billion in revenue in the first three months of 2022, both up roughly 13% year-over-year.

 

Takeaway: For every thinkpiece about the metaverse, and parts of the world migrating to a VR or AR world where Mark Zuckerberg can sell digital Gucci clothes to the digital avatar you keep for yourself, another washing machine or industrial factory is getting plugged into the Internet of Things. Part of the future may reside in some yet-to-be-realized digital world, but what's more likely is the internet will become the backbone of all the technology and devices we use in the real world. For that, you won't need an avatar, you'll just need a new fridge.

 

*****

 

A message from our sponsor:

 

Shark Tank's Mr. Wonderful advises StartEngine

 

And he's such a successful investor, he gets paid to do it on TV.

 

Our point is, Mr. Wonderful (real name: Kevin O'Leary) just might be onto something. Not only is StartEngine growing over 100% year-over-year, they've also helped fund over 500 offerings with capital from 760,000+ investors.

 

Investing like a Shark usually requires some deep pockets, – but readers of The Daily Upside can invest in StartEngine right now for just $500.

 

Invest in StartEngine here.

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Written by Brian Boyle.

Disclaimer

(1)  PRELIMINARY UNAUDITED INTERNAL INFORMATION; FINAL DATA MAY VARY SIGNIFICANTLY.

 

(2) Number of users is determined by counting investor profiles with unique email addresses which are active and have been confirmed.

 

(3) TOTAL RAISED INCLUDES STARTENGINE'S OWN RAISES AND IS INCLUSIVE OF INVESTMENTS THAT HAVE BEEN CLOSED ON AND INVESTMENTS THAT ARE RECEIVED BUT NOT YET CLOSED ON.

 

Kevin O'Leary is a paid spokesperson for StartEngine. Read the 17b disclosure here.

 

The preceding post was written and/or published as a collaboration between The Daily Upside's in-house sponsored content team. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. The Daily Upside may receive monetary compensation from the issuer, or its agency, for publicizing the offering of the issuer's securities. This content is for informational purposes only and is not intended to be investing advice. This is a paid ad. Please see 17b disclosure linked in the campaign page for more information.

 

Reg A+ offering made available through StartEngine Crowdfunding, Inc.  StartEngine is not currently accepting investments from WA and TX. This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment.  Please see the offering Offering Circular and Related Risks for more information.

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