Why smart home appliances are attracting venture capital

Over the past six to 12 months, they have provided early-stage check support of $1-4 million to about a half-dozen startups, including Beyond Appliances, Upliance, and Karban.

Beyond Appliances and Upliance automate cooking functions through artificial intelligence, while Karban leverages CFD (computational fluid dynamics) technology and aerospace engineering to optimize the efficiency of airflow devices such as fans and air purifiers. On2cook, Alste Technologies and Keus have also raised funds to make kitchens smarter through technology.

Consumer appliances brand Atomberg Technologies is one of the first new-age companies to enter this space. The company raised $86 million in Series C funding in 2023, led by Temasek Holdings and Steadview Capital Management.

The company, which launched a line of IoT-enabled smart ceiling fans in 2023, is growing rapidly, with operating income up 31.5% to $848 crore in 2023-24 $645 crore a year ago.

Vinay Singh, co-founder and partner at Fireside Ventures, which led a $200 investment in Beyond Appliances in November 2024, said the Indian kitchen appliances market is ripe for innovation but untapped in terms of consumer-centric smart solutions. Thousands of dollars in financing.

“Consumers of kitchen appliances are changing rapidly, driven by key trends such as the desire for convenience, the importance of safety, and the need for an enjoyable kitchen experience. The market size is expected to be US$5.5 billion, with a CAGR of (CAGR) of 9.86%, this segment offers huge potential,” said Singh. Mintnoting that the smart kitchen space is at an inflection point, with consumer demand shifting toward smart, connected appliances that solve real, everyday problems.

For example, Beyond Appliances was launched just six months ago and already has over 1,200 customers across major cities.

Chance

To be sure, India’s overall smart home appliance market is expected to grow 8.56% from 2024 to 2029, reaching a market size of US$4.6 billion by 2029, according to research platform Statista.

“We have aggressive growth plans for 2024-25, supported by eight new innovations on the horizon and strategic expansion into more cities. We want to be $Eshwar K. Vikas, CEO and co-founder, Beyond Appliances, said: “The brand value will touch Rs 100 crore in two to three years” Mint.

Vikas said that despite people spending two to three hours a day in the kitchen, there has been little technological innovation in these spaces. “Our research shows that consumers, especially those in the 35-50 age group, are actively seeking solutions to make cooking more efficient and enjoyable,” he said, adding that the company is already in the smart kitchen space Several opportunities have been identified and are being developed with AI – powerful capabilities and IoT integration capabilities.

One of Upliance’s flagship products is a smart cooking assistant, Mahek said, and it is looking at new product lines, including new hardware accessories for enhanced versatility and speed, as well as features or services that leverage artificial intelligence, such as personalized meal planning Or health-focused add-ons. Mody, the startup’s co-founder and CEO.

He added that the company’s recent annual revenue run rate exceeded $150 million rupees.

Shivaraj Jayakumar, head of consumer and internet practice at business consultancy Praxis Global Alliance, said these companies are leveraging the latest technology to meet the unique needs and preferences of Indian consumers and help them grow.

He said changing consumer preferences for using the latest technology, openness to adopting smart home solutions, and awareness of the potential of smart home solutions to increase efficiency and convenience in the kitchen are driving interest in these companies.

Dinesh Pai, vice president of business analysis and investments at Rainmatter by Zerodha, which invested in smart kitchen company Upliance, said: “Our investment in Upliance is based on the view that as more young people eat out, their diet The potential for unhealthy food will only increase. We need solutions that make it easier for Indians to cook at home. Upliance does just that. “

Traditional companies are also catching up with the new trend of smart home appliances. Founded in 2009, Wonderchef launched Chef Magic, an all-in-one kitchen robot with fully automated cooking processes, in April. However, the company last raised capital in 2021, showing lackluster investor sentiment. Other popular traditional appliance startups such as Femora and Vaya have yet to raise any funding.

challenge

Since most of these companies cater to the high-end market, pricing can be a challenge. “Smart kitchen appliances are still in their infancy in India, providing huge headroom and share gains for first movers. However, consumers remain largely price-sensitive and companies need to offer competitive prices to drive adoption,” Jayakumar said.

However, Vikas believes pricing will not be an issue for the company as customers recognize the value added. “When you look at our range of smart cooktops, $15,000 and rising $24,500, it effectively competes with conventional four-burner stoves that cost around $24,500 $15,000, but offers significant added value through features such as flame failure detection and digital timers…It is encouraging that customers clearly recognize this value equation,” he said.

In the meantime, Upliance is exploring lower-cost variants or subscription options to make the product available to more households, Mody said.

These companies also need to overcome infrastructure challenges such as limited broadband connectivity and power outages that can impact user experience.