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March 06, 2023 | Tom Ballard

Venture capital takes a dimmer view of Internet of Things start-ups

PitchBook reports that a decline in funding was most dramatic for retail and healthcare IoT start-ups.

PitchBook reports that venture capital investment in internet of things (IoT) start-ups dropped sharply in the second half of 2022, and the outlook for 2023 shows a continuation of the downward trajectory.

According to an “Emerging Tech Research” report, the conclusion from PitchBook is that this is a sector more sensitive to macroeconomic risk. Specifically, the organization’s research found that:

  • Venture capital investors pulled back support most dramatically from retail and healthcare IoT start-ups.
  • In the most resilient sectors, use cases including commercial drones, connected buses, and manufacturing monitoring devices maintained revenue growth of more than 30 percent in 2022.
  • Investors made big bets on smart home technology last year, but revenue growth for the sector fell short of expectations, leaving uncertainty around start-ups’ abilities to reach growth milestones.

The full report can be downloaded at this link.

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