The Quantified Self
Market Overview and Proprietary Financial Intelligence
Note: this is an adopted presentation of one given at the SVB Quantified Summit in Boston on April 3, 2014
Contents• Quantified Self Defined• Key Drivers• Wearable Technology• Software & Analytics • Augmented Reality• Summary
#svbQS| April 3, 2014
Quantified Self: Defined
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Products or services that use technology to extract and record data from everyday activities with the goal of providing information and
insight that helps users to understand or improve personal behavior.
Quantified Self: Acceleration
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TECHNOLOGY ADVANCESSensors, smartphones, bluetooth low energy,
smart watches, wearables
CONSUMER BEHAVIOR
SOCIAL
Focus on self-improvement and general wellness
Connectivity to social networks,
gamification
MOBILETech-savvy,
Mobile-centricpopulation
The confluence of several key factors has driven the acceleration of this young, but rapidly growing sector
Quantified Self: Hype Curve
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Technology TriggerPeak of Inflated Expectations
Trough of Disillusionment Slope of Enlightenment Plateau of Productivity
Mass-Market WearablesMass-Market SoftwareNiche-Market WearablesAnalytics Software
The Quantified Self shows great promise but is still in the early stages of maturity, adoption,
and social application
Expe
ctat
ions
Time
Note: circle size indicates relative size of markets
Quantified Self: Hype Curve
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Technology TriggerPeak of Inflated Expectations
Trough of Disillusionment Slope of Enlightenment Plateau of Productivity
Mass-Market Wearables
Mass-market wearables have led the way in Quantified Self
development and adoption
Expe
ctat
ions
Time
Wearable: Acceleration
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Metcalfe’s LawMoore’s Law
Ubiquitous Computing
Design Focus
Battery/Sensor Technology
Mobile Integration
Advances in cost and performance of
technologies, network effects of mobile adoption, and other factors accelerate mass-market wearables
Wearable: Market Leadership
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Fitbit68%
Jawbone19%
Nike10%
All Other3%
2013 Wearable Device Sales
Mass wearables is a highly-saturated market, dominated by a few major players. Incumbents have a significant advantage over new startups with regard to sales, marketing, and distribution channels. In fact, since this
presentation was first given, even Nike chose to wind-down its FuelBand.
Mobile Hardware: Replacement
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History of mobile devices provides a lesson for Quantified Self mass-
market wearables—namely that one device can do the job of many
Wearable: Cannibalization Risk
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0
40
80
120
16020
02
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Uni
ts S
old
(mm
)
Release of the first-generation iPhone marked the beginning of a stark turnaround in iPod sales
iPod vs. iPhone Device Sales
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0
0.5
1
1.5
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2.5
3
2007 2008 2009 2010 2011 2012 20130
20
40
60
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Gar
min
PN
D S
ales
(mm
)iPhone Sales (m
m)
Smartphone vs. Personal Navigation Device SalesWearable: Replacement Risk
Advances in mobile device hardware enable mobile applications to replicate some functionality of a wearable using existing hardware.
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5.3x
9x
11.3x
5.1x
2.6x 2.5x
x
2x
4x
6x
8x
10x
12x
<$5M $5M-$20M $20M-$50M $50M+0
20
40
60
80
100
120
Inve
sted
Cap
ital M
ultip
le
Revenues (mm)
Invested Capital (m
m)
Wearable: Shifting ValuesPre-2011 Median IC MultiplePre-2011 Median IC
Post-2011 Median IC MultiplePost-2011 Median IC
As evidence of saturation, post-2011 wearable technologies required more investment to reach revenue thresholds and
had lower valuations compared with previous years.
Quantified Self: Hype Curve
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Technology TriggerPeak of Inflated Expectations
Trough of Disillusionment Slope of Enlightenment Plateau of Productivity
Niche-Market Wearables
Smartphone data collection isn’t feasible in every situation (e.g. smart swim goggles), providing opportunity for niche wearables
Expe
ctat
ions
Time
Mobile Hardware: Niche Catalyst
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Smartphones aren’t a replacement, but rather a catalyst for acceleration
in niche-wearables—enabling the storage and analysis of personal data collected by niche-wearable devices
Niche Wearable: Stability
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0
30
60
90
120
150
180
2007 2008 2009 2010 2011 2012 2013
Uni
t Sal
es (m
m)
iPhone adoption negatively impacted sales for point-and-shoot cameras, however the more niche DSLR camera sales remained stable.
iPhone vs. Camera Device Sales
Niche Wearable: Crowdfunding
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$-
$100,000
$200,000
$300,000
$400,000
$500,000
0 500 1000 1500 2000 2500 3000
Cro
wdf
undi
ng $
Number of Backers
Quantified Self startups are flocking to crowdfunding platforms, particularly as a source of pre-order funding for new hardware applications, which also
demonstrate consumer demand prior to potential venture investment.
Crowdfunding Campaigns (Q2-2013 to Q4-2013)
Quantified Self: Hype Curve
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Technology TriggerPeak of Inflated Expectations
Trough of Disillusionment Slope of Enlightenment Plateau of Productivity
Mass-Market Software
As hardware adoption increases data collection, software is there
to store and analyze it
Expe
ctat
ions
Time
Software: Acceleration
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Social Media Integration
Smartphone HardwareUser model promotes
Viral Growth
Data recording and storage
Analytics
Device Agnostic
Growth in software has naturally followed the first wave of hardware development, but viral growth in socialization of information and
gamification should be major accelerants of this segment
Software: Device Agnostic
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Mobile software is device agnostic—applications can utilize data from any wearable, creating a cross-platform
device for users
Software: Value Accretion
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$2.77
$3.85 $4.00
05
1015202530354045
< 5M 5M-10M 10M-50M$0.00$0.50$1.00$1.50$2.00$2.50$3.00$3.50$4.00$4.50
Inve
sted
Cap
ital (
mm
)
Users(mm)
Value Per User
Total Invested Capital Value per User
When the community using a particular software grows, so does its value to investors (and users). This should accelerate as the
adoption of Quantified Self technologies increases.
Network Effect and Big Data
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Network effects occur when applications reach a critical mass of users, and social connectivity becomes a driver of engagement. Existing
software solutions aggregate mass amounts of data, which creates opportunity for a new wave of health analytics companies.
Quantified Self: Hype Curve
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Technology TriggerPeak of Inflated Expectations
Trough of Disillusionment Slope of Enlightenment Plateau of Productivity
Analytics Software
Though in the very early stages, the next major push will come
from big data analytics
Expe
ctat
ions
Time
Analytics: Next Accelerant
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Big data analytics represents a tremendous growth opportunity because the tools that will be used already exist and have been
implemented in other sectors (e.g. digital advertising).
Augmented Reality:The Internet of Everything
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Data will eventually be collected on
most everything, sent to, stored, and
analyzed in the cloud, and have
recommendations sent back to users
to enhance real-time decision-making
Summary
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• Mass-market wearables led the way in the development and early adoption of Quantified Self technologies, but shows limited opportunity for new startups moving forward because of market saturation and replacement/cannibalization risks that have already become evident.
• Because smartphones aren’t able to collect data in every situation, we still see acceleration potential of niche wearables (e.g. smart swim goggles). Unlike with mass-wearables, smartphones will further enable—not replace—niche wearables devices.
• We are also optimistic about growth acceleration in software, due to the continual improvements in hardware enablement and the viral growth of socialization and gaming.
• As adoption of Quantified Self technologies spreads and data collection increases, we see the next big push coming from data analytics—which has already been a major factor in other markets, such as digital advertising.
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