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