TECH SCOUTING: FUTURE OF WEARABLES

© 2019 Proprietary and confidential. To better understand disruptive companies and technologies in the wearables industry, a top consulting firm used Quid to analyze 2,394 company profiles and 2,948 patent applications. COMPANIES Companies involved with wearables technology focus on seven main areas, with software and app development being the largest and most central topic. Other large categories included health and medical care, and hardware and materials for devices.

Health & Medical Care (16%) Sports & Fitness (11%)

Safety & Assistive Technology (13%) Software & App Development (26%)

Apparel (5.3%)

Hardware & Materials (15%) AI & Human Interaction (9.7%)

Network with 2394 companies. Colored by tags. Sized by degree. Labeled by tags. A deeper dive into specific sub-categories reveals an industry with wide-ranging applications. Central themes include fitness, action sports, and language recognition.

Fitness (4.4%)

Action Sports (3.2%)

Batteries & Charging (1.8%)

Language Recognition (3.1%)

Network with 2394 companies. Colored by clusters. Sized by degree. Labeled by clusters. App development and hardware have consistently attracted investors, but investment is rapidly diversifying. Health & medical, AI & human interaction, and safety & assistive technology are emerging areas of investor interest.

$2.5B Total Investment: $12.7 billion

$2B

Samsung Biologics, and Webe Digital, ● Hardware & Materials $1.5B received the largest investments in the ● Software & App Development industry over the last decade, with $658.2 ● AI & Human Interaction and $609.7 million, $1B respectively. ● Health & Medical

● Sports & Fitness

$500M ● Safety & Assistive Technology

● Apparel

0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Bar chart of investment totals by year. Colored by tags. Safety and assistive technologies, for instance, is the fastest growing segment in the wearables industry, with 54.3% CAGR for the last three years, followed by AI and human interaction.

Investment Founding Investment Received Amount Inv. CAGR Tags Number of Received Companies Year Median (2015-2018) Count Total Total Median

Software & App Development

Hardware & Materials

Health & Medical

Safety & Assistive Technology

Sports & Fitness

AI & Human Interaction

Apparel

Heatmap of company network. Colored by tags. Samsung and Acer are leading on acquisitions of wearable technology firms, with a dominant focus on those producing hardware and materials. Other top acquirers include large technology and telecommunications firms such as Apple, Intel, Alphabet, and Blackberry. Top Acquisitions by Company

Samsung Fire & Marine Insurance Acer Samsung Apple Dentsu Apple acquired FlyBy Media in 2016. Dixons Carphone The company develops computer vision Intel technology to connect the digital and physical worlds. Softbank Alphabet Blackberry ● Hardware & Materials Delfin Blackberry acquired AtHoc, Software & App Development EssilorLuxottica Inc., which provides networked ● crisis communication solutions, ● AI & Human Interaction in 2015. ● Health & Medical Logitech Robert Bosch ● Sports & Fitness Square ● Safety & Assistive Technology WPP Apparel Western Digital Corporation ● ALTAVIA

0 1 2 3 4 5

Bar chart of top acquisitions by company. Colored by tags. Some companies within the rapidly growing safety and assistive technology category also may have broader applications across the industry, signaling larger trends. Companies that have high inter-cluster connectivity share similar language with those in other categories and may have wide-ranging utility across the entire network.

Sports, Fitness Sentimoto Ltd produces sensors that (1.6%) capture and send key physiological and Health & Medical Care (1.3%) environmental data to mobile devices. The technology can be applied across workplace Hardware & safety, health, and emergency alert Materials (0.50%) categories. Safety, Assistive Technology 13%)

Sensinite Oy manufactures sensor technology that can be used to detect Apparel nuclear radiation. These sensors have wide- (0.54%) ranging applications across emergency alert and health sectors.

Software, App Development (1.2%) Saphibeat Technologies produces AI-based wearable devices that track data for performance, safety, and social sharing. The technology can be applied broadly to Inter-Cluster Connectivity emergency alert systems, action sports, 0 0.80 telecommunications, and health.

Cluster with 464 companies in the safety and assistive technology category highlighted. Colored by inter-cluster connectivity. Overview

Sentimoto Ltd produces sensors that capture and send key physiological and environmental data to mobile devices. The technology can be applied across workplace safety, health, and emergency alert categories.

Founded 2013 Investment Received $33.1K (1) Industry Health Care Technology City London Country United Kingdom Company Type Private Operating Status Operating Events $33.1K Private Investment Top Investors Bethnal Green Investors (1)

Company profile Bridging nodes fill gaps between clusters and can reveal opportunities for innovation within the wearables industry. Companies already taking advantage of whitespace opportunities are bridging distinct use cases.

Between Parents & Children and Pets:

• TAG Smart Devices – expandable, modular tracking device for a variety of use cases, including keeping tabs on children, pets, or elderly parents with “Geo-Fencing” and “Fall Detection” features

Between Materials & Displays and Heart Rate & Blood Pressure:

• Textronics, Inc.– produces NuMetrex clothing that monitors the body for sports performance and vital signs monitoring

Between Music & Sound and Human-Computer Interaction:

• Apotact Labs – produces Gest, a wearable glove designed to navigate electronic interfaces and replace a keyboard and mouse

Network with 2394 companies. Colored by clusters. Sized by degree. Labeled by clusters. TECHNOLOGIES Patent applications for wearables technology largely focused on data management, batteries, and hardware, with intelligent systems and health and medical as central themes.

Semiconductor (8.4%) Intelligent Systems (AI, AR, VR)(10%)

Display and Lens (5.5%) Data Management (20%)

Battery & Electrochemical Materials (16%)

Device Communications (6.6%)

Health & Medical Hardware (12%) (7.6%)

Network with 2948 patents. Colored by categories. Sized by degree. Labeled by categories. Top categories for wearable patent applications included heart rate trackers, payment and authentication systems, and augmented reality/virtual reality.

Secondary Battery (1.3%) LED, Display (2.7%) Coating Materials (5.7%) Processor (3.3%) Graphics Processing (1.7%) Multimedia Electronic Device (1.1%) AR/VR (7.3%) Semiconductor, Films (2.3%) Data Management (1.6%)

User Interface (4.2%) Optical Lens Assembly (2%)

Detection, Identification (5.8%) Haptic Feedback (1%)

Wireless Charing (2.9%)

Payment & Authentication (7.2%) Circuit Board (5.6%)

Earpiece (2%)

Sharing Info, Communications (3.7%) Electronic Device (4.1%)

Intelligent Interface (3.6%) Transmitting Data (1.6%) Heart Rate Tracker (7.6%) Mobile Wireless Communication (5.7%)

Network with 2948 patents. Colored by clusters. Sized by degree. Labeled by clusters. Patents for intelligent interfaces jumped in the past year for things like wearable robots, automatic language translation, and human-computer interface via smart ring. On the whole, patent applications appear to be shifting away from technology categories such as heart rate trackers and detection.

100%

● Heart Rate Tracker

Intelligent Interface and ● AR/VR Payment and Authentication patents appear to be on the ● Payment, Authentication rise. ● Detection, Identification 50% ● User Interface

● Intelligent Interface

Patent filings for heart rate ● Sharing Info, Communications 25% trackers, and detection and identification, established ● Data Management wearables technology have been stable or on the decline. ● Transmitting Data

Digital Assistant 0 ● 2013 2014 2015 2016 2017 2018

Stacked bar chart of patent applications by year. Colored by cluster. , a Chinese company, is dominating the patent filings for Intelligent Interfaces, with many filed within the last year or two. The company is reportedly working on wearable phones, with a 5G to be released in 2019.

Patent Assignees for Intelligent Interfaces Nubia Technology

Guangdong Okii Technology

Guangdong Mobile

Samsung

Hewlett Packard

Lenovo

Xiaomi Technology

Alibaba

DIRECTV Coloring by Application Date

Dec 30, 2013 July 13, 2018 Huizhou Mobile

0 5 10 15 20 25 30

Bar chart of patent assignees by number of patents. Colored by time period. Credit card companies are filing many recent patent applications for payment and authentication technologies; however, tech firms have typically been dominant. Both VISA and Capital One filed patents in 2018 . Tech companies like Apple, Samsung, Intel, IBM, and filed the majority of patents during the five-year time period.

Capital One filed two patents for configuring wearable devices used in financial transactions.

● Tech Companies

VISA filed a patent for a ● Credit Card Companies portable communication device for providing Mobile Companies reliable timestamp ● credentials.

Timeline of patent assignees by number of patents. Colored by category. Samsung is most frequent to cite and be cited by other companies in patent filings, meaning it is both influential and influenced by others in the industry.

450 Samsung Hewlett Packard Hewlett Packard and Aliphcom had smaller numbers of patent Apple cites other companies filings overall, but they have been more than anyone else, which cited a lot by other companies, could mean that they are keen meaning that they likely had a few to adapt existing technologies. patents that were very influential Aliphcom across the wearables industry. Apple

LG

Intel Incoming Citations Incoming Qualcomm IBM Energous Corp Bragi

VISA Microsoft

State Farm

Outgoing Citations 2500

Scatterplot of patent citations by company. Colored by company. Haptic Feedback, the use of touch to communicate with users, and earpieces were new and highly cited categories within the wearables industry, indicating high potential areas for future growth.

4.5 Current Trends Emerging Trends Heart Rate Tracker Heart Rate Trackers, Mobile Wireless Communication AR/VR, and Payment Coating Materials Authentication are Sharing Info, Communications central to the patent Haptic Feedback filings for the Wireless Charging industry, but are Earpiece more established AR/VR Payment Authentication Other new categories like Detection, Identification User Interface biomedical wearable devices, Semiconductor and intelligence interfaces have Digital Assistant fewer citations and appear less influential across the industry Electronic Device LED, Display Incoming Citations (Mean) Citations Incoming Processor, Chips Intelligent Interface

Graphics Processing

Flat Panel Displays Transmitting Data 0 Biomedical Wearable Device

April 25, 2015 Application Date March 2, 2018

Scatterplot of patent citations by cluster. Colored by cluster. APPENDIX The density of a cluster indicates how similar or diverse the nodes HOW TO READ are within it A NETWORK

Each node represents a document Similar nodes cluster together, and clusters are grouped by color. Connections represent similar language across nodes.

Centrally located nodes are core concepts in the network and share language with many other Greater distance between clusters nodes indicates a lower number of interrelated documents

A bridging node between two clusters indicates the document is at an intersection between two concepts. TEXT ANALYTICS BACKGROUND

Quid reads any text to Then Quid compares Quid repeats the process identify key words, words from each at immense scale, phrases, people, document to create links producing a network that companies and between them based on shows how similar all the institutions. similar language. documents are to one another.