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Intelligent Hardware Trend in China

L
lucaswang

A brief introduction of this new hardware trend and market dynamic in China. Also, to catch up this trend, how HWTrek perceives its position here and value offered to both startups and supply chain companies.

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Intelligent Hardware / 智能硬件Trend in China
April, 2015
Lucas Wang, CEO of HWTrek
@ WI Harper ASM 2015
1
THE WORLD
2
Reimagining Everyday Objects by Matt Witheiler
hardware products that bring new consumer experiences to products we
interact with on a regular basis, transforming the every day
3
Gartner defines "makers" as inventors, tinkerers
and entrepreneurs who create and manufacture
products using traditional tools and new digital
design and rapid prototyping and manufacturing
technologies. "Startups" are fledgling businesses
that are often technology-focused and have the
potential for high growth.
4
Gartner Says By 2017, 50% of Internet of Things
Solutions Will Originate in Startups That Are Less
Than Three Years Old
Smaller Quantity but Diversified categories
• USD1,900B -> 7,100B IoT market size 17.5% CAGR from 2013 to2020 by IDC
• IDC defines the Internet of Things as a network of networks of uniquely identifiable
endpoints (or “things”) that communicate without human interaction using IP
connectivity – be it “locally” or globally
5
CHINA: HUGE AS THE SAME FOR
EVERYTHING ELSE
6

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Intelligent Hardware Trend in China

  • 1. Intelligent Hardware / 智能硬件Trend in China April, 2015 Lucas Wang, CEO of HWTrek @ WI Harper ASM 2015 1
  • 3. Reimagining Everyday Objects by Matt Witheiler hardware products that bring new consumer experiences to products we interact with on a regular basis, transforming the every day 3
  • 4. Gartner defines "makers" as inventors, tinkerers and entrepreneurs who create and manufacture products using traditional tools and new digital design and rapid prototyping and manufacturing technologies. "Startups" are fledgling businesses that are often technology-focused and have the potential for high growth. 4 Gartner Says By 2017, 50% of Internet of Things Solutions Will Originate in Startups That Are Less Than Three Years Old
  • 5. Smaller Quantity but Diversified categories • USD1,900B -> 7,100B IoT market size 17.5% CAGR from 2013 to2020 by IDC • IDC defines the Internet of Things as a network of networks of uniquely identifiable endpoints (or “things”) that communicate without human interaction using IP connectivity – be it “locally” or globally 5
  • 6. CHINA: HUGE AS THE SAME FOR EVERYTHING ELSE 6
  • 7. IOT market to target RMB$750B in 2015, and 22% growth rate 7
  • 8. Smart Home market to reach RMB$43B with 42% growth rate in 2015. Comparing to Globe's US$68B 8
  • 9. Wearable to have 35M units shipped, 170% growth in 2015 to be a market of RMB$10.6B 9
  • 10. • Almost 50% people could accept RMB$501~2000 wearable goods • 7% could go higher, and, 30% stocks with RMB$201~500 10 Yes, people are affordable
  • 11. Mixed echo system supported with locals and overseas players still 11
  • 12. Local “New generation” of hardware startups are emerging too 12
  • 13. 13 Now, copycat no more. Ninebot to buy Segway
  • 14. 14
  • 15. All similar product strategies among giants: Cloud/APIs, echo system, routers, TVs and kids 15
  • 16. HOW TO PERCEIVE THIS MARKET 16
  • 17. It starts with a twit by US embassy about Beijing air condition in 2011 17
  • 18. A less 1% penetration market of air purifier, suddenly crowed with “Internet Companies” 18
  • 19. Issues Here • High marketing & sales cost – Immature market requires more education costs – Crowdfunding, pre-order or flash sell creates high risk of production management – Fewer retail channels available • Failed to capture the real demand – Too much emphasize on marketing and fancy features – Not so much “intelligent” • Few differentiation – No “star” product with unique features, more similar goods on the market – Easily to get tired customers without motivation to purchase • Incomplete industry standard – Google is NOT working here – Home appliances allies vs. Internet gangs vs. traditional PC families 19
  • 20. THE RESOURCES: VC & CROWDFUND 20
  • 21. Money is flowing into “Smart Home” and “wearable related” projects and sectors 21
  • 22. Crowdfund concept brought in China around 2012, but got huge attention in 2014 which results in 23+ crowdfund sites. Even with professional media to release their version and TV shows about it. For the leader now, JD Crowdfund, it is online on July, 2014 and accumulated 300+ successful projects with RMB$140M raised. And, hardware ate up 56% of that money In 2014, total 10,000 crowdfunding projects including equity and reward basis with RMB$1,031M raised. Among them, reward basis projects generated RMB$ 349M by near 6,000 projects 22
  • 23. HWTREK: BRIDGE THE IDEAS TO GOODS 23
  • 24. Mismatch of Resource and Demand Demand side: • Fashion alike product profile, short lifecycle and faster revision • Decentralized innovation, 8/2 => 5/5 with longer long tail • Service/software as the core of teams Resource side • Need for new topics: PC market is not coming back • ODM model is design for millions of quantity production with matured product design and team • SMEs vs. SMEs: inefficient of management and communication 24
  • 25. HWTrek: Build to Deliver • HWTrek is a trusted hardware innovation platform started in late 2013 aims to accelerate the development of new hardware projects. HWTrek creates an end to end ecosystem from prototyping to mass production partners which hardware creators could find the seamless support of “build to deliver”. • We are a team of hardware lovers with background in hardware manufacturing, semiconductors, mobile Internet and social networks, a combination of software and hardware 25
  • 26. Matching and Bridging • Up to date, HWTrek connects to over 300 hardware supply chain Experts and over 500 manufacture related companies. 120+ projects got bridge to the best manufacture partners for last 10 months. • Successfully reaching to creator communities in San Francisco, Berlin, Barcelona, London Beijing, and Taipei, over 2,200 creators registered and look for partners 26
  • 27. Connect All: Collaboration Hub Collaboration Hub (PDH): A core project management software to bring Experts, Creators and HWTrek together helping on schedule and resource allocation. A hardware development focus oriented with intelligent learning, like a Navigation system to guide the project. We will track all progress and patterns even the project fails! 27
  • 28. HWTrek’s Competitive Edge 28 • Open & transparent Community, 2,200+ Creators, 400% CMGR on monthly reach. 700+ project listed • Multi to multi platform, end to end ecosystem served, 300+ hardware Experts • Seasoned project managers from Internet, hardware, manufacture and investment • Solid and incomparable manufacture network, 500+ supply chain partners • Project management and intelligent system to connect all • Asia operation cost HWTrek will solve the missing piece in the new hardware ecosystem
  • 29. What Creators say about HWTrek It’s also great to be able to network with the other hardware companies going through the same processes as us right now, and it’s great that HWTrek is able to connect companies like us with the manufacturers to potentially make partnerships. Mike Kasparian, CTO of Atlas Wearables We needed some serious electronics and HWTrek was able to meet our rigorous requirements, providing unparalleled support for the RFQ process to source for the right supply chain partners, and helping to more effectively keep track of the product’s progress through every stage of development. Anthony Matanna, Founder of Hooke 29 There are 700+ more on going…
  • 30. Traditional vs HWTrek, from Offline to Internet 30 HWTrek duplicates the offline activities to Internet basis as aiming to change the way how supply chain communication works since last 10 years