By Scott MacDonald
Partner, McRock Capital
In the ever-accelerating world of technological advancement this statement is not just a clever tweet, it’s a sober competitive reality. We live in a digital world where every company, industry, city and country is being disrupted at a very fast pace. Recent history proves that new winners are emerging and past champions are afforded no certainty.
Here are some of the findings from the McRock Industrial Internet of Things Report 2016.
The Digital Age, which officially began in 2010 and is expected to continue until 2030, will be 5-10 times bigger than the Information Age (1990 – 2010). This Digital Age is driven by the Internet of Things (IoT) and is estimated to have an economic benefit over the next decade of $19 trillion, or the equivalent to the US economy today. The Digital Age takes us beyond simply accessing volumes of data. It moves us closer to controlling and predicting complex outcomes. Advancements in software analytics and operational automation will drive a major wedge in the growing digital divide.
The inflection point of the Digital Age arrived in 2015 when we looked back to see how far we had come. Here’s the IoT growth by the numbers since 2012:
- 18.2 billion things connected to the Internet today versus 8.7 billion
- 13x growth in sensors shipped
- 5.9 billion machine-to-machine connections (M2M) in place today versus 2.6 billion connections
- $779 billion in IoT revenue today versus $450 billion
- 2x growth in M2M service revenue of $122 billion today up from $66 billion
- $1.4 billion in predictive maintenance revenue versus $400 million
Over the past five years we have seen the number of corporate groups engaged in the IoT and, more specifically, the Industrial IoT soar. Corporate consortia involvement has grown 50-fold since 2012. Today more than 350 different corporations belong to IoT consortiums as they prepare to survive and thrive in the new Digital Age.
McRock was founded in 2012 when only a handful of corporations like Cisco and GE seriously understood the potential of the IIoT. We had a vision that the profound digital transformations taking place in the consumer and enterprise markets would similarly provide massive opportunities and disruption to large trillion dollar industries.
Today companies such as Électricité de France, Schneider, Pitney Bowes, SKF, Siemens, Rio Tinto, and Schlumberger have now started the transition into the Digital Age. GE has aggressively positioned itself as the Digital Industrial company. This provides exciting opportunities for venture-backed IIoT tech companies looking for reputable customers, channel partners and ultimate acquirers.
Scott MacDonald will share his knowledge as part of the “Investment Strategies” panel at the Wavefront 2017 IoT Summit in Toronto, May 1-2. Along with Yuri Navarro from the National Angel Capital Organization, Mischa Steiner of Awesense and Wavefront CEO Jim Maynard, this panel will explore how Canadian companies are investing in innovation.