The smart home space has been moving fast this past year. First,
Washington D.C.-based SmartThings sells $100 hardware hubs and provides a cloud platform to make the hundreds of smart gadgets out on the market talk to each other in one unified app. The company came to life among the DIY gadget crowd with a successful Kickstarter campaign that raised $1.2 million. It has since raised another $12.5 million in Series A venture capital from Greylock and others.
Samsung already has many connected home appliances on the market. What the SmartThings technology could do is better connect its appliances to other third-party devices onto one central platform. This is what Apple looks to be aiming to do with its HomeKit and what Nest may one day achieve after opening up its API program to allow other devices to talk to its growing family of smart gadgets.
SmartThings isn't the only smart home company providing a central platform to connect devices. Revolv, for example, sells a much pricier hardware hub for $300 with seven radios that can talk to the majority of smart home gadgets out there now. The unique thing about SmartThings is its robust community of more than 5,000 developers who work on how these different devices can interact. For example, you could get an alert on your smartphone if your basement starts to flood, or have your Fitbit tell your coffee maker to get to work as soon as you wake up.
Towards the end of the year, the company wants to offer paid apps similar to Apple's App Store, SmartThings CEO Alex Hawkinson recently told FORBES.
One successful business model SmartThings looks to emulate is cloud computing powerhouse Salesforce. Similar to how developers can build applications over Salesforce's cloud platform to find new ways of managing their sales network, SmartThings developers can build new ways of connecting up the home that SmartThings could never dream up by themselves.
“Salesforce built this platform for developers because they honestly didn't have the expertise and domain knowledge for every possible application,” explained SmartThings cofounder and CTO Jeff Hagins in an interview last month. “We looked at the smart home space and said exactly the same thing. We don't have all the answers.”
One developer, for example, created an application that makes your Sonos speakers bark like a dog if there's suspicious movement outside your house.
The Samsung deal has reportedly not closed yet and SmartThings isn't commenting, but this is another sign that the tech giants are seeing a major opportunity and are staking out turf in the connected home. The smart home market is already estimated to be worth a hefty $33 billion in 2013 and expected to grow to $71 billion by 2018, according to Juniper Research.
SmartThings has been experiencing plenty of growth itself since its founding in 2012. With “tens of thousands” of the SmartThings systems currently installed in U.S. households, the company's install base is growing at a rate of 20% a month, Hawkinson said recently.
SmartThings CEO Alex Hawkinson started the company in 2012 to give his house a "voice." If this deal goes through, the company and the smart home world will have a much bigger voice.
