Do you know what the "smart grid" is all about?
If not, you should. Someone is going to get rich doing smart grid startups.
The smart grid is a fresh wave already rising around the world. It will have lasting repercussions on how we live and work, how we make money, and a lot more. You can read further at Wiser wires, a short, comprehensive report on who is doing what about the smart grid. I liked this report because it was quick to read and included both new and established enterprises.
What stood out to me was this: this new wave is already maturing! Learning what condition a new thing is in can save you a lot of agony, and open the door to opportunity. Here is what I mean:
For instance, startups are already actively working on products and services that solve several of the key problems to building the smart grid and reaping the benefits of its huge potential. Here is a short list of some of the startups mentioned:
- Trilliant Networks and Silver Spring Networks are focused on solving problems of the IT network that connects the smart points of the power grid.
- eMeter helps utilities manage the usage data and combine it with other information to set rates upon demand.
- Control4 and iControl offer "home area network" (HAN) devices that allow consumers to control almost everything in a house that runs on electricity.
- Tendril and GridPoint offer related web based services.
Then I read of the existing players and saw they ranged from recent IPOs to established giants, powerhouses to be greatly respected. Here are some of them:
- EnerNOC went IPO in 2007 in the demand response business, a new market category.
- Oracle offers software similar to eMeter.
- IBM helps utilities connect their disparate systems.
- Cisco is expected to enter the IT networks grid market, HAN solutions, and more. Siemens has its eyes on several of the market segments.
- Microsoft and Google offer products for consumers to track their power usage.
When you read of a pattern like this, where startups in a new field are being mentioned in mass media reports, and where giants are publicly declaring their intentions about it, then you know a new wave has arrived and is well on its way to growth and expansion.
Foundation Capital partners chose to focus on investing in smart grid startups. Other VCs have invested in related startups (simply Google "smart grid venture capital" and watch what you get.)
- GridPoint and Silver Spring Networks have raised $220m and $170m respectively.
- iControl recently raised $23m.
BOTTOM LINE: The trick is to realize that a new wave in this condition is already maturing rapidly, from the point of view of startups and venture capitalists. It is also nearly too late to be one of the startups that will lead one of the new market segments that are created as the early market grows and splinters. Instead you will have to spot a fresh splinter forming before one startup takes the lead (in becoming the dominant gorilla of a fresh market segment/category). When you can do that, you can time the launch of your startup and catch a ride of a lifetime! Such skill is part of the unfair advantage of the winning startups.
I wish you The Best on your Adventure!