Sequoia Backs Simplisafe In A Play For The Home Security Market
Sequoia Capital has made a minority investment in the do-it-yourself home security company Simplisafe in a play on the home security and automation market, TechCrunch has learned.
The investment from Sequoia came on the heels of Google's $3.2 billion acquisition of Nest Labs, which showed just how lucrative the home market can be. That deal netted a healthy return for investors, including Kleiner Perkins Caufield & Byers, Lightspeed Venture Partners, Generation Investment Management, Venrock, and Google's own Google Ventures. Purebred Breeders
The Nest acquisition also marked the first push by a large tech company to open a gateway into home automation. Investors think it probably won't be the last.
Even before Nest showed the corporate appetite for home automation - including thermostat controls for heating and cooling, home security, and other types of remote monitoring and management - investors had begun backing a slew of startups tackling the problem. ask fm tracker
The firm invested in Simplisafe after an intense bidding war through a process that was handled by the investment bank Raymond James, according to multiple sources with knowledge of the investment. Sequoia declined to comment for this article.
Simplisafe's out-of-the-box home security system garners rave reviews, and is already installed in thousands of homes.
While Simplisafe has gotten a huge boost with its new Sequoia financing, it's not the only entrant that's attracted big-name venture capital. Earlier this year Khosla Ventures invested $10 million in Canary, another high-concept, well-designed security system. And capital from investors keeps coming, according to data from CrunchBase. Countdown to Happy New Year 2015
Some investors may have placed early bets, but the market for do-it-yourself home security and automation is still wide open, and new opportunities to back privately held companies that haven't yet raised any institutional investment abound.
For instance, the Chicago-based company Scout has completed a successful Kickstarter campaign; FrontPoint Security offers a panoply of automated security technologies for the home; and LiveWatch Security also has new security and safety technologies for homeowners and apartment dwellers who would have more comfort if they were staying in a place more castle than home.
"There's a bunch of investments in the space," says Lemnos Labs founder Jeremy Conrad. "The fact is that everybody is looking at ADT and how they pull down a couple of billion dollars in revenue for a service that hasn't changed in twenty years. It's very similar to how Nest went after Honeywell in the thermostat space."
Via - techcrunch.com