IoT leader Smartfrog acquires majority stake in U.S. IoT pioneer Canary

17. Octo­ber 2018

Berlin, Dublin, New York (ots) — Smart­frog, one of Europe’s leading IoT compa­nies, acqui­res a control­ling stake in US IoT pioneer Canary and invests US $25 million in the company’ s growth toge­ther with Canary’s exis­ting key inves­tors. Charles Fränkl, CEO of Smart­frog, will hence­forth lead both companies.

Combi­ning Canary’s and Smartfrog’s busi­nesses will allow both compa­nies’ resour­ces, teams, their market exper­tise and comple­men­tary distri­bu­tion chan­nels to be lever­a­ged and bene­fit from syner­gies to conti­nue to grow the busi­ness toge­ther in both the U.S. and Europe.

Smartfrog’s and Canary’s products, tech­no­lo­gies, markets, busi­ness models and distri­bu­tion chan­nels comple­ment each other seam­lessly. While Smart­frog has so far successfully focu­sed on the Euro­pean market, Canary has been able to posi­tion itself as one of the market leaders in the USA. Smart­frog pursues a pure SaaS busi­ness model, offe­ring soft­ware as a service inclu­ding. hard­ware as a subscrip­tion and gene­ra­tes over 90% of its sales directly in its own online store, irre­spec­tive of statio­nary (retail) and online trade (etail). Canary, on the other hand, offers its products prima­rily at retail and is available in more than 10,000 retail stores in the U.S. and Europe. Around half of the custo­mers then purchase a paid subscrip­tion that provi­des access to addi­tio­nal func­tions and services such as cloud storage. Both compa­nies main­tain sales coope­ra­ti­ons with inter­na­tio­nal part­ners. Smart­frog coope­ra­tes with energy suppli­ers such as e.on in Germany, First Utility in the UK and Maxenergy in Austria. Canary estab­lished part­ner­ships with insu­r­ers in the U.S., inclu­ding State Farm, Liberty Mutual and Alls­tate. The products and tech­no­lo­gies of both compa­nies, such as the solu­ti­ons offe­red, the IoT plat­form, arti­fi­cial intel­li­gence and machine lear­ning are also complementary.

Simi­lar to Smart­frog in Europe, Canary succee­ded in buil­ding a leading market posi­tion and one of the stron­gest SaaS busi­ness models with stable growth in recur­ring reve­nues, espe­ci­ally in the US. “By bund­ling our poten­tial, the Group is even better posi­tio­ned in the highly compe­ti­tive IoT market and equip­ped for further inter­na­tio­nal growth,” says Charles Fränkl. “The joint invest­ment by leading U.S. inves­tors and Smart­frog is a further vali­da­tion of our vision and busi­ness model — also in Sili­con Valley,” Fränkl added.

The market for smart home IoT has reached a turning point with around 16 percent market pene­tra­tion in Germany and 7.5 percent world­wide, and thus conti­nues to offer great growth poten­tial. Through the further deve­lo­p­ment and sensi­ble use of new tech­no­lo­gies such as arti­fi­cial intel­li­gence and machine lear­ning, as well as by offe­ring easy-to-use products at low prices, a clear added value can be gene­ra­ted for users and thus smart home IoT can be deve­lo­ped into a mass market.

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