SmartThings Raises $12.5 Million From Greylock And Highland To Power The Internet Of Things
Internet-of-Things startup SmartThings has spent the last year or so building a platform that people can use to connect to an increasingly wide range of devices in their homes.
Context & Ripple Effects
SmartThings has spent the past year building a platform meant to connect a widening range of home devices, and the $12.5 million round from Greylock and Highland confirmed today is the capital behind scaling it. Both relationships check out as confirmed as of the announcement date.
What stands out is distribution: the story ran the same day not only on TechCrunch but also on AllThingsD, VentureBeat, and Gigaom, with repeat pickups — unusually broad attention for a startup round, and a signal that home-connectivity platforms were already on every major tech desk's radar in late 2013.
First-order effects
- SmartThings gains $12.5 million from Greylock and Highland to accelerate the device-connection platform it has spent roughly a year building.
- Greylock and Highland take early institutional positions in one of the most heavily covered companies in home IoT, with the round drawing same-day write-ups from AllThingsD, VentureBeat, and Gigaom.
Second-order effects
- Greylock and Highland now have portfolio incentives to route their consumer and enterprise contacts toward SmartThings, effectively extending its business-development reach through their networks.
- Connected-device makers deciding which hubs to build for face a better-capitalized SmartThings, which strengthens its hand in the race to become the default layer between heterogeneous home hardware.
Third-order effects
- If rounds like this keep flowing into horizontal home-connectivity plays, the smart home trends toward a small set of platform owners controlling device compatibility, rather than one-off apps paired to individual products.
The trend: Venture capital is consolidating around horizontal Internet-of-things platforms that bridge many devices at once, over software tied to any single product.