IoT drives strategic diversification, growth & differentiation
The Internet of Things (IoT) is going to be a game changer for companies to transform their businesses. Here are two great examples:
A 150-year old provider of speciality insurance company — Hartford Steam Boiler (HSB) acquired Meshify last year. HSB is owned by the reinsurance giant Munich Re (ranked as the #1 reinsurer in 2015). HSB Ventures is an active investor in the IoT space with investments in Augury, Slice, Helium, Waygum etc.
CEO Greg Barats of HSB has said (just a month before the Meshify acquisition) that “insurers must be ready to embrace the disruption through IoT — or risk being made obsolete by hungrier technology companies”.
Meshify was founded in 2012, and had raised seed money, followed by debt financing (Crunchbase info). It is an interesting strategy. HSB has chosen to acquire and own an IoT platform that aids in critical issues of remote diagnostics, predictive maintenance and equipment monitoring. Meshify is part of HSB’s IoT business — yes an insurance company HSB has an IoT business.
Xylem is a water technology company, spun off originally from ITT in 2011. Their current CEO Patrick Decker (3rd since the spinoff) has been growing Xylem through a series of strategic acquisitions. Last year Xylem acquired Sensus and set the stage for an IoT-driven diversification and growth.
This is a bold move for a company that is not a software or a digital company. It proves the point that IoT can be a strategic differentiator for companies dealing with the ‘physical’ world.
Sensus brings a wide spectrum of “smart” solutions to the Xylem brands (Sensus sales are dominated today by Smart Metering for Electric, Gas & Water utilities). The Sensus division will now be the home for all things ‘analytics’ for all Xylem brands (see link to investor deck). Xylem has a bold vision on how to transform the company with IoT. Xylem also has acquired Visenti (a Smart Water analytics company based out of Singapore) following the Sensus acquisition in November 2016. Sensus in 2015 had acquired a Smart Grid analytics company called Verdeeco.
Bottomline IoT is going to disrupt industries, and visionary companies are getting ahead of the curve by making IoT a key part of their future strategy.
HSB/MunichRe/Meshify & Insurance:
Xylem/Sensus & Smart Water Resources: