IoT platform provider Golioth has raised $4.6 million in seed funding led by Blackhorn Ventures and Differential Ventures with participation from existing investors, Zetta Venture Partners, MongoDB Ventures and Lorimer Ventures. This brings the total funding for the three-year-old company to $7.1 million.
Golioth is an IoT platform built for hardware flexibility. Jonathan Beri, the founder and CEO, has worked at Nest, Particle, and at WeWork building connected hardware. He found existing IoT platforms limited hardware designers to a few standardized chips and boards that matched with the existing cloud providers. But if a company wanted to replace components or customize those boards, they would have to do some robust cloud engineering on their own to make the switch.
Golioth flips that model on its head, letting hardware designers pick and choose the elements they want and then taking the burden of making sure those are supported in the cloud. Current partners include Nordic Semiconductor, Infineon, NXP Semiconductor, Ubidots and others. With this funding, Beri said he plans to add support for more partners and build more reference designs, especially to help build use cases in the construction industry and for utilities. As part of this announcement, Golioth is launching a program to find 15 new design partners building solutions for the energy and utility sector, and 15 design partners building solutions for the construction industry.
Beri said that in the time he’s been operating the company he’s discovered that helping customers get from idea to pilot is a big leap, which is why the company has created reference designs that can provide about 90% of whatever a company might need. Then the customer can more easily handle the rest of the customization.
I’m impressed that an IoT company raised money in what is a tough funding environment if you’re not including generative AI in your deck. Beri said that efficiency — both internally at Golioth and externally by helping Goliath customers better use resources — helped convince venture firms to invest. Beri talked about customers that are using the IoT to save water or reduce their consumption of materials or fuel. With both a focus on economic efficiency and sustainability, Beri said Golioth has a story that resonates with investors today.
It’s also helpful that while Golioth is an IoT company, it’s not a hardware company. Middleware may not be sexy, but it is something that’s hard to do well, and can generate revenue at VC-friendly profit margins. “The fundraising environment was bad, especially if you have anything to do with hardware,” said Beri. “But our investors were really focused on resource efficiency, and that’s something we were able to raise on.”
Golioth can build on existing partner and customer wins without spending a lot of capital up front, which also helped with raising the funding. This is a good thing, because the IoT is finally hitting the mainstream for many businesses and Golioth can take advantage of more customer interest. The growth of the IoT across less tech-savvy industries such as retail, waste management, utilities and construction has been slow going, but according to a Forrester report out late last week, 83% of U.S. businesses are investing in, or plan to invest in IoT solutions.
Forrester’s report highlights businesses using the IoT for better customer service followed by energy management and facilities management. Those latter two are likely related to the efficiency and sustainability goals that so inspired Golioth’s investors. The same push toward energy efficiency has also driven sales in companies like Schneider Electric and Rockwell Automation which have seen their smart building and smart manufacturing sales rise in the first quarter of 2023.
Big and small companies are finally feeling comfortable investing in IoT technology that can help them make better use of finite resources whether it’s because they have carbon goals to meet or they simply want to weather a recession. Golioth’s platform will help the folks responsible for building those IoT technologies do so quickly, without having to learn how to build cloud applications or manage them.