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RFID Technology Firms Win Investors
Investment in firms serving the RFID technology market has exceeded $1.1 billion over the
last 18 months
Dallas, TX (February 21, 2007) - Investment in firms serving the radio frequency identification (RFID)
technology market has exceeded $ 1.1 billion over the 18 months ending in January 2007. These
investments in RFID technology firms resulted in 59 investment transactions over the 18 month period.
The $1.1 billion represents an investment rate in the 28-37 percent range of the RFID market’s total
sales. The investment rate is based on market estimates by market research firms placing the market for
RFID systems and services in the range of $3 billion to $4 billion for the same 18 month period.
A look back: investment profiles
RFID Investments by Transaction Class (July 2005 – January 2007)
Investments include $.7 billion of transactions in which firms acquired other firms. The largest acquisition
was Lockheed Martin’s acquisition of active RFID systems provider Savi Technology. Investments also
include $.4 billion of venture funding and private equity funding, with the firm Alien Technology topping
the list of firms attracting the most equity investment capital. There were no IPO transactions – Alien
Technology announced an IPO in April 2006, but withdrew its plans for that IPO in July 2006.
The majority of investment funding came from corporations with RFID technology initiatives. Corporate
investors placed 67 percent of the investments. Private equity firms and venture capital funds placed 33
percent of the investments in RFID companies.
A total of 50 investment transactions resulted in an average of $19 million per transaction. Some of the
59 investment transactions involved parties that did not disclose a transaction value. Taking into account
the transactions without a disclosed value, the average transaction value was more likely to be in the
$20-$25 million range.
RFID Investments by Firm Class (July 2005 – January 2007)
Systems provider firms and equipment companies have attracted the most capital among RFID
technology firms over the last 18 months. Providers of RFID equipment and RFID tags attracted 86
percent of the investments. These firms provide RFID equipment in the form of tags, interrogation
devices, real time location systems and contactless cards. Software firms, providing RFID software,
middleware and business analytics, received 8 percent of the investments. Service firms, providing
systems integration services, received 6 percent of the investments.
A look forward: segments likely to receive investment in the next 18 months
“Companies attract investment capital by having customers, cash flow and growth potential,” said Mark
Johnson, president of RFID Tribe. “Real time location systems (RTLS) and active RFID technologies for
asset tracking applications have attracted a healthy amount of investment in the last 18 months,” he
continued. RTLS technology and active RFID technology firms Ekahau, IDENTEC SOLUTIONS, PanGo
Networks and WhereNet have attracted investment in the last 18 months. .
Industries like consumer electronics, apparel and pharmaceuticals have demonstrated a desire to track
and trace their goods. Products in these industries often have high value, run at high volume and are
targets of theft or counterfeiting activities. Item-level tagging allows companies to track products at a
more granular level than tracking at the case, pallet or vehicle level. Firms that enable item-level tagging
applications will see increased investment.
Communications providers will show interest in payment applications tied to cell phones. The area of
near field communications (NFC) applications is emerging as an area of innovation attractive to
investors. NFC applications enable cell phone users to make mobile payments and micro payments using
their cellular device. Look for communications equipment providers like Nokia, Samsung, Qualcomm and
Motorola and for payment providers like VISA, MasterCard and American Express to make investments in
mobile payment applications.
As EPCglobal’s EPC Information Services (EPCIS) standards evolve, they will facilitate use of the
EPCglobal network. RFID technology firms designing products and services to use the EPCglobal
network show substantial promise. RFID applications using the EPCglobal network focus on supply chain
optimization – reducing out-of-stocks, reducing inventory, increasing sales and increasing the
effectiveness of sales promotions.
Unique identification (known as UID) applications have significant potential. The US Department of
Defense (DoD) uses UID in its supply chain and focuses its suppliers on UID applications. Suppliers to
the US military look for UID applications to comply with US DoD supply chain initiatives.
A number of end-user firms are making investments in RFID technology companies. Firms like UPS,
Pfizer and Kaiser Permanente have made investments in RFID companies hoping to enhance their
strategic position by placing bets on promising applications of RFID technology. “When end users invest
in technology firms, they are investing in technologies that may be of strategic value to their company,"
said Johnson
More information regarding the $1.1 billion of RFID investments – profiles for firms who received
investment, investors who made the investments and transaction details are available at the RFID
Investment Center.
RFID Investment Summit
In-depth dialogue regarding RFID investment trends, uncovering RFID investment opportunities and
showcasing some of the RFID firms seeking investment takes place at the RFID Investment Summit on
March 26, 2007. The RFID Investment Summit is held at the RFID World 2007 Conference and hosted by
RFID Tribe. Investors, corporate directors of business development and CEO's meet to discuss RFID
technology investments and to tell their unique story around value proposition and intellectual property.
RFID Tribe is a community where entrepreneurs, corporate investors and private investors trade ideas
regarding founding, funding and growing RFID firms. RFID Tribe tracks details on investments in RFID
companies, researches trends in RFID technology investments and hosts the RFID Investment Center.
(www.rfidtribe.org)
Investment in firms serving the RFID technology market has exceeded $1.1 billion over the
last 18 months
Dallas, TX (February 21, 2007) - Investment in firms serving the radio frequency identification (RFID)
technology market has exceeded $ 1.1 billion over the 18 months ending in January 2007. These
investments in RFID technology firms resulted in 59 investment transactions over the 18 month period.
The $1.1 billion represents an investment rate in the 28-37 percent range of the RFID market’s total
sales. The investment rate is based on market estimates by market research firms placing the market for
RFID systems and services in the range of $3 billion to $4 billion for the same 18 month period.
A look back: investment profiles
RFID Investments by Transaction Class (July 2005 – January 2007)
Investments include $.7 billion of transactions in which firms acquired other firms. The largest acquisition
was Lockheed Martin’s acquisition of active RFID systems provider Savi Technology. Investments also
include $.4 billion of venture funding and private equity funding, with the firm Alien Technology topping
the list of firms attracting the most equity investment capital. There were no IPO transactions – Alien
Technology announced an IPO in April 2006, but withdrew its plans for that IPO in July 2006.
The majority of investment funding came from corporations with RFID technology initiatives. Corporate
investors placed 67 percent of the investments. Private equity firms and venture capital funds placed 33
percent of the investments in RFID companies.
A total of 50 investment transactions resulted in an average of $19 million per transaction. Some of the
59 investment transactions involved parties that did not disclose a transaction value. Taking into account
the transactions without a disclosed value, the average transaction value was more likely to be in the
$20-$25 million range.
RFID Investments by Firm Class (July 2005 – January 2007)
Systems provider firms and equipment companies have attracted the most capital among RFID
technology firms over the last 18 months. Providers of RFID equipment and RFID tags attracted 86
percent of the investments. These firms provide RFID equipment in the form of tags, interrogation
devices, real time location systems and contactless cards. Software firms, providing RFID software,
middleware and business analytics, received 8 percent of the investments. Service firms, providing
systems integration services, received 6 percent of the investments.
A look forward: segments likely to receive investment in the next 18 months
“Companies attract investment capital by having customers, cash flow and growth potential,” said Mark
Johnson, president of RFID Tribe. “Real time location systems (RTLS) and active RFID technologies for
asset tracking applications have attracted a healthy amount of investment in the last 18 months,” he
continued. RTLS technology and active RFID technology firms Ekahau, IDENTEC SOLUTIONS, PanGo
Networks and WhereNet have attracted investment in the last 18 months. .
Industries like consumer electronics, apparel and pharmaceuticals have demonstrated a desire to track
and trace their goods. Products in these industries often have high value, run at high volume and are
targets of theft or counterfeiting activities. Item-level tagging allows companies to track products at a
more granular level than tracking at the case, pallet or vehicle level. Firms that enable item-level tagging
applications will see increased investment.
Communications providers will show interest in payment applications tied to cell phones. The area of
near field communications (NFC) applications is emerging as an area of innovation attractive to
investors. NFC applications enable cell phone users to make mobile payments and micro payments using
their cellular device. Look for communications equipment providers like Nokia, Samsung, Qualcomm and
Motorola and for payment providers like VISA, MasterCard and American Express to make investments in
mobile payment applications.
As EPCglobal’s EPC Information Services (EPCIS) standards evolve, they will facilitate use of the
EPCglobal network. RFID technology firms designing products and services to use the EPCglobal
network show substantial promise. RFID applications using the EPCglobal network focus on supply chain
optimization – reducing out-of-stocks, reducing inventory, increasing sales and increasing the
effectiveness of sales promotions.
Unique identification (known as UID) applications have significant potential. The US Department of
Defense (DoD) uses UID in its supply chain and focuses its suppliers on UID applications. Suppliers to
the US military look for UID applications to comply with US DoD supply chain initiatives.
A number of end-user firms are making investments in RFID technology companies. Firms like UPS,
Pfizer and Kaiser Permanente have made investments in RFID companies hoping to enhance their
strategic position by placing bets on promising applications of RFID technology. “When end users invest
in technology firms, they are investing in technologies that may be of strategic value to their company,"
said Johnson
More information regarding the $1.1 billion of RFID investments – profiles for firms who received
investment, investors who made the investments and transaction details are available at the RFID
Investment Center.
RFID Investment Summit
In-depth dialogue regarding RFID investment trends, uncovering RFID investment opportunities and
showcasing some of the RFID firms seeking investment takes place at the RFID Investment Summit on
March 26, 2007. The RFID Investment Summit is held at the RFID World 2007 Conference and hosted by
RFID Tribe. Investors, corporate directors of business development and CEO's meet to discuss RFID
technology investments and to tell their unique story around value proposition and intellectual property.
RFID Tribe is a community where entrepreneurs, corporate investors and private investors trade ideas
regarding founding, funding and growing RFID firms. RFID Tribe tracks details on investments in RFID
companies, researches trends in RFID technology investments and hosts the RFID Investment Center.
(www.rfidtribe.org)
Searching for RFID technology Investments ? Searching for funding for your RFID company? RFID Investment Center |
RFID Technology Firms Win Investors
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