Sensors have been here long ago before the IOT rise that started in 2010. Meanwhile they became the single-most dominant element representing IOT – standing at the intersection of physical and digital worlds. They are not only enabling smartification of products, objects, materials, services but also have immense impact on our everyday life as such – no matter whether you talk about lidars, strain-gauges, thermocouples or gyroscopes . Advancing developments in connectivity and AI created a wide space of smartification possibilities and further broadened the scope of sensor usability.

IOT and Sensor Markets Dynamics

According to research by Fortune Business Insights, the IOT market will reach 1.46 trillion USD by 2027 and is expected to witness a growth at CAGR almost 25 % annually. You may wonder why the global sensor market is worth 167 billion USD in 2019, projected to grow annually only at a pace of approx 9 % annually between 2021 to 2028. Answer may be simpler than you think – and first we should draw a line between sensors and smart sensors. Smart sensors typically consist of three important parts:

  • sensing element;
  • signal processing part;
  • and microprocessor.

In other words, a sensor is considered smart when it takes a predefined action based on the input it receives, thus vastly boosting the automation of the overall operation. Another difference between a smart sensor and a conventional one is typically the size, accuracy, sampling frequency and power consumption. When we go back to the global smart sensor market size (valued at 36.6 billion USD in 2020) it is set to grow to 87.6 USD billion by 2025, at a CAGR of 19 % annually. It is driven by the ever-growing adoption and implementation of smart sensors across all industries and escalating demand for smart sensors by automotive, healthcare and other manufacturers to deliver improved safety and comfort. Investing in IOT or more specifically to sensors not only brings business opportunities, but it also opens the door to cost reduction, efficiency, safety and personalization for clients. Adoption of IOT strategy becomes inevitable for many businesses and the itching question is whether to invest in developing their own strategy, join forces with the sensor specialists or look for suitable acquisition targets.

Global sensor companies investment landscape

According to Crunchbase, that keeps track of 2124 sensor companies – the market is flourishing. Despite the slight decline and corona related setbacks reported in automotive IOT and sensor markets (notably in 2020 and 2021) the market has been more than active and shows no decline. Quite the contrary. Since 2019 the number of investments has been more or less stable, but the investment volumes in funding rounds rocketed significantly during last 2 years:

  • from 834.2 million USD in 2019;
  • to 4.942 billion USD in 2020;
  • and 5.720 billion USD in 2021.

Europe has been active and matched up both the US and China/Asia in terms of funding transaction count, yet the average funding per transaction is lower.

Global sensor start-up investment landscape

Based on Crunchbase ‘s report that gathers data on 479 sensor startup companies – the market is also on the rise. Recorded investment volumes in funding rounds showing stable growth during last 2 years:

  • from 305.9 million USD in 2019;
  • to 726.8 million USD in 2020;
  • and 1.236 billion USD in 2021.

Again, Europe is matching US and China/Asia in funding transaction count, however the average funding per transaction is lower as in case of sensor companies. Most active investors on European level that provide not only access to funding sensor startups, but also mentoring, acceleration programmes, scaling etc. include EISMEA European Innovation Council and SMEs Executive Agency (Belgium), Parkwalk Advisors (UK), High-Tech Gründerfonds (Germany), 360 Capital (France) and Robert Bosch Venture Capital (Germany).

source: www.crunchbase.com

Investing in sensor companies in CEE (Central and Eastern Europe)

Despite the fact that this region gets overlooked from time to time, make no mistake, the Central and Eastern Europe start-up scene is alive and well, and sensor start-up founders are working hard to bring the next big sensor unicorns.

Region is built on strong academic background (Technische Universität Wien, Graz University of Technology, Czech Technical University in Prague, Brno University of Technology, Warsaw University of Technology, Budapest University of Technology and Economics, Vilnius Gediminas Technical University to mention just few) and the network of research institutes. Important to mention is also that the greatest minds of this latitude get educated in the top global technical universities.

Report published by Skanska and SpotData Most Important Trends in the CEE Economies 2021 states that AI and IOT can substantially contribute to the growth in GDP in the CEE region. IDC Worldwide IOT Spending Guide forecasted that spending on the IoT in Central would grow 20.6 % annually from 2017 till 2021, reaching total spending nearly 27 billion USD as organizations continued to invest in the HW, SW, and connectivity that are significantly helping IoT reaching every corner of the economy. After successful path has been set by AMS AG (from Austria) since early 80’s younger companies following after 2010 leading the local scene include: USound (from Austria), NeuronSW (from Czech Republic), Click & Grow (from Estonia), Brolis Sensor Technology (from Lithuania), and Photoneo (from Slovakia).

Countries (and respective companies) that we researched to represent the local market include Austria, Czech Republic, Hungary, Poland, Slovakia, Bulgaria, Romania, Moldova, Croatia, Slovenia, Serbia, Montenegro, Kosovo, North Macedonia, Albania, Lithuania, Latvia, Estonia, Ukraine and Belarus.

  STARTUP COMPANY NAME WEBSITE COUNTRY EST. FUNDING
1 Almendo Technologies GmbH (bluSensor) https://www.blusensor.com/en/ Austria 2012  
2 Blue Danube Robotics GmbH (Airskin) https://www.airskin.io/ Austria 2013 2.60 mil EUR
3 Caipos GmbH http://www.caipos.com/ Austria 2011  
4 DirectSens GmbH https://www.directsens.com Austria 2013  
5 emotion3D GmbH https://emotion3d.ai/ Austria 2010 4.00 mil USD
6 endiio GmbH https://www.endiio.com/ Austria 2014  
7 Geoprospectors GmbH https://geoprospectors.com/ Austria 2015  
8 helloplant GmbH http://www.helloplant.eu/ Austria 2017  
9 RADICOS Technologies GmbH https://www.radicos.com/ Austria 2011  
10 SteadySense GmbH https://www.steadysense.at/ Austria 2016 6 mil EUR
11 UnravelTEC OG https://www.unraveltec.com/ Austria 2018  
12 USound GmbH https://www.usound.com/ Austria 2014 70.7 mil EUR
13 XARION Laser Acoustics GmbH http://xarion.com/ Austria 2012  
14 Technoton Engineering https://rd-technoton.com/ Belarus 2015  
15 ENOVA H20 http://www.enova-h2o.com/ Bulgaria    
16 Supracontrol d.o.o. https://www.supracontrol.com/ Croatia 2015  
17 Angee Inc. https://www.meetangee.com/ Czech Rep. 2014 1.5 mil USD
18 miomove s.r.o. https://www.miomove.com/ Czech Rep. 2016 0.7 mil EUR
19 NeuronSW SE https://www.neuronsw.com/ Czech Rep. 2016 9 mil EUR
20 Pears Health Cyber s.r.o. (Thermeeno) https://www.thermeeno.com/en/ Czech Rep. 2018  
21 Sense Arena s.r.o. https://sensearena.com/ Czech Rep. 2017 2.2 mil USD
22 Sensority s.r.o. https://www.sensority.eu/ Czech Rep. 2014  
23 Sewio Networks, s.r.o. https://www.sewio.net/ Czech Rep. 2014 1 mil USD
24 Spaceti B.V Holding https://www.spaceti.com/ Czech Rep. 2016 4.1 mil USD
25 Vím o všem s.r.o. https://www.vimovsem.cz/ Czech Rep. 2017 0.6 mil USD
26 Click & Grow LLC https://www.clickandgrow.com/ Estonia 2009 13.2 mil USD
27 Heartbit Holding Ltd https://www.theheartbit.co.uk/ Hungary 2016  
28 MoonSyst Zrt. https://moonsyst.com/home Hungary 2014 0.2 mil EUR
29 Quantis Labs Kft. http://smartvineyard.com/ Hungary 2010 1 mil USD
30 HackMotion SIA https://hackmotion.com/ Latvia 2016  
31 UAB Brolis Sensor Technology https://brolis-sensor.com/ Lithuania 2011 15 mil EUR
32 UAB Nanoenergija (Viezo) https://viezo.lt/ Lithuania 2018  
33 Airly Sp. z o.o. https://airly.eu/en/ Poland 2015 3.3 mil USD
34 Beskid Instruments Marek Stopka https://beskidinstruments.com/ Poland 2017  
35 Eco Life Sp. z o.o. https://www.ecolife.eu.com/ Poland 2016 1 mil USD
36 E-Test Sp. z o.o. https://www.e-test.eu/ Poland 2010  
37 EU-SENSE https://eu-sense.eu/ Poland 2018  
38 Every European Digital Poland sp. z o.o. (IOTA) http://www.iota-sensors.com/ Poland 2015  
39 Heavy kinematic machines Sp. z o.o. https://heavykinematic.com/ Poland 2017 1.4 mil USD
40 HigoSense Sp. z o.o. https://higosense.com/ Poland 2017 5 mil EUR
41 Mreh Sp. z o.o. http://mreh.pl/ Poland 2015  
42 Sense Monitoring sp. z o.o. https://sense-monitoring.com/ Poland 2017  
43 Kineto Tech Rehab SRL (Reflex Help) https://reflex.help/ Romania 2015  
44 Magnasci SRL (Urad Monitor) https://www.uradmonitor.com/ Romania 2014  
45 Tokinomo Marketing SRL https://www.tokinomo.com Romania 2018 0.7 mil EUR
46 Photoneo s.r.o. https://www.photoneo.com/ Slovakia 2013 33.6 mil USD
47 RVmagnetics, a.s. https://www.rvmagnetics.com/ Slovakia 2015 2.5 mil EUR
48 Sensoneo j.s.a https://sensoneo.com/ Slovakia 2014 2.3 mil USD
49 CBSR d.o.o. (CubeSensors) https://cubesensors.com/ Slovenia 2012  
50 Tehnološke rešitve, Andrej Nastran s. p. (Daisy) http://daisy.si/ Slovenia 2013  
51 LLC Skok Agro https://skokagro.com/ Ukraine 2015  

Most active investors on CEE level that provide funding local sensor start-ups include:

  • EU funds (mainly Horizon2020, EIC Accelerator and EISMEA) and EIB;
  • Amadeus Capital Partners, Credo Ventures, Earlybird Venture Capital, eQventure, J&T Ventures, RSJ, SEB Alliance, KBC, eQventure, Trind VC, United Angels VC, Zabolis Partners, Fund of Innovations and Technologies;
  • International VC’s such as Next 47, Y Combinator, SAP.io, Plug and Play Tech Center;
  • and many others.

Geographical complexity, diverse languages spoken and complex history make this region hard to tackle for western based investors. On the other hand – the bottom-line stays the same regardless of the region. What is understood very well in the world of investments is solid business model, proven revenues, technology applicability, R&D backed solution, IP protection, firm business strategy and last but not least striving for success. And in the wake of recent years also trusting science.

Good luck in the next investment round.