The market potential of wearable computing devices is set to gain traction this year with at least seven venture capitalists saying that they are evaluating deals in this space.
The Consumer Electronics Show 2014 displayed an array of next-generation technology products. Large tech giants like Google, Intel and Samsung have already entered into this segment which has made venture capitalists sit up and take notice of the segment. Google Glass, Nike Fuel Band and Samsung Galaxy Gear are some of the popular wearable devices.
“Technology and related sectors will continue to dominate investments in 2014. Wearable computing will attract funding,” says Pradeep Tagare, director at start up investor Intel Capital in India. The firm is looking to fund two to three wearable computing firms this year. These companies are involved in manufacturing devices that can be worn on bodies like gloves, censors in helmets. “We are looking at wearable computing deals in almost every pitch meeting and 2014 should be the year when we actually visit the space,” says Padmaja Ruparel, president at Indian Angel Network (IAN).
Wearable computing includes products like temperature-based wearable electronics, gears for nerve stimulation and pain management and other transformational technological products.
One of the earliest wearable technology firms to have received venture capital funding was Hyderabad-based climate conditioning apparel company Dharma Innovations in 2009. Angel investment network Mumbai Angels alongwith Reliance Venture Asset Management invested Rs 90 lakh in the company. Both the venture capital firms received an exit on the company two years ago with three times return on capital.
“We are looking at wearables in India and globally. The young demography in India is very tech-savvy and want to track everything at the same time. It will be much attractive here but obviously cost is an issue that will come down once the scale and volume are reached,” says Niren Shah, managing director at VC firm Norwest Venture Partners. The company is in discussions with a firm that makes a prototype of a fitness product.
“Wearable technology has gone beyond watches and armbands to smart collars and shirts. Obviously, this has made venture capitalists interested in the category,” says Anshul Gupta, principal research analyst at Gartner. Wearable devices are amongst the top IT trends driving digital power growth, based on a report by IT firm Accenture titled 'Technology Vision 2014.'
According to market research firm Research And Markets' report titled 'Wearable