When you hear the term “wearable,” you probably think of wristbands, such as the Fitbit or the Apple Watch. In reality, these devices represent only a small portion of an increasingly diverse sector.
There are augmented reality headsets, such as the Microsoft Hololens, interactive textiles like the conductive yarn that Google’s Project Jacquard is developing for full-body monitoring, and hearing devices such as Eargo, which raised $13 million from Maveron and others in June.
According to CrunchBase, venture investors have spent nearly $2.6 billion backing 138 wearable companies since 2008. Over half of this total ($1.6 billion) has gone into 45 California-based startups.
Between 2013 and 2014, venture funding for wearable companies nearly tripled from $361.5 million to just over $1 billion. While this is primarily due to Magic Leap’s two funding rounds that alone total $592 million, other notable fundings include Athos’ $12.2 million Series B led by DCM Ventures and Misfit Wearable’s $40 million Series C led by GGV Capital.
According to CrunchBase data, wristbands and hand-worn devices have attracted the most attention (and money) from venture investors with over $1.1 billion for 46 startups. Head-worn products follow close behind with over $1 billion for 32 companies. In addition, there is a substantial category of “other” wearable-related technologies: 37 companies developing sensors and applications to enhance broader connectivity.
True Ventures and Khosla Ventures are the most active investors in the wearable space, with six investments each. Andreessen Horowitz has backed five wearable startups, including augmented reality companies Magic Leap and Oculus VR along with smart jewelry startup Ringly.
Although wrist-worn wearables have attracted the most VC interest in terms of number of rounds, six of the top ten companies with the most funding are actually developing products that seek to interact with other parts of the body.
Fitness wearable devices may have served as a test case for the consumer market to gauge sector viability — CrunchBase tracked 24 fitness wearables startups launched since 2006, which have raised a total of over $1 billion.
Following Fitbit’s IPO debut, multitudes of new companies have sprouted up throughout different, less saturated sectors with a variety of wearable gadgets and applications.
Ekso Bionics, for instance, is developing a bionic suit that uses small motors and sensors to double as a sort of surrogate muscle. Dubbed as the “iPhone of exoskeletons,” it is an essential product for paraplegics and wounded veterans in need of neurorehabilitation. It has raised $36.8M to date.
Altogether, wearable companies are slated to sell as many as 187.2 million units by 2020, more than quadruple the projected amount of 45.7 million units this year.
