Smart grid network players are slowing choosing their preferred startups to provide applications and devices at the edges of the network. On Tuesday, router giant Cisco announced it has made an equity investment in, and has created a distribution partnership with, Control4, a startup that provides home automation and energy gear and services. (Cisco’s SVP of Emerging Technologies Marthin De Beer, and Control4’s CEO Will West will both be speaking at our Green:Net event on April 21 in San Francisco.)
The companies aren’t announcing the size of Cisco’s investment, but Cisco is the leading investor in Control4’s most recent $15 million funding round, which I reported on last week. According to the filing, Control4 already closed $15 million of the round and is in the process of raising a total of $25 million in a combination of equity, options and security.
Cisco’s Wim Elfrink, chief globalisation officer and EVP, explained the Control4 distribution deal to me as a non-exclusive agreement to provide Control4’s home operating system in projects with cities and utilities. Elfrink said, for example, that Cisco is working with the city of Incheon in South Korea to build connected homes that will include Control4 home energy products, as well as Cisco’s building automation technology and telepresence video conferencing.
The news of the partnership and equity stake come on the heels of Control4 doing a deal with Cisco smart grid competitor and networking company Silver Spring Networks just a month ago. That’s the beauty of open standards and IP-based networks: application companies can plug in anywhere on the network. Though, for the smart grid it’s still early days — Elfrink compared the maturity of the smart grid to the Internet 20 years ago in our phone conversation.
Cisco also has a broader vision of the smart grid, moving beyond just utility energy projects, and encompassing “the Internet of things” and truly connected cities. Over that type of platform, Cisco can sell a whole host of products.
Control4 is one of the home energy startups that seems to be finding some success in a difficult market. In the summer of 2009, Control4 raised $17.3 million largely to launch a division to connect its wireless home products with smart meters, smart grid services and utilities. At the Distributech smart grid conference last week, Control4 announced a deal to provide at least 20,000 of Control4′s home energy devices and software to Nevada utility NV Energy. In the utility world, 20,000 home energy devices is a sizable deployment, and Control4 called the deal the first true rollout — not a pilot — of customer-driven demand response using home area network technologies.
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