LONDON: French start-up Sigfox has raised 100 million euros ($112.80 million) from seven heavy-weight investors to help it build new networks globally to connect everything from washing machines to smart metres to the Internet, sources said.
The deal, to be announced on Wednesday, is poised to beat French ride-sharing company BlaBlaCar's $100 million fund raising last summer, the sources familiar with the matter said.
It is the third time since it was founded by French entrepreneur Ludovic Le Moan five years ago that Sigfox has turned to investors to finance its growth, as the firm aims to roll out its network in 60 countries within the next five years.
Investors include Spain's Telefonica and France's GDF Suez, the sources said.
Telecoms operators NTT Docomo of Japan, SK Telecom of South Korea, France's Air Liquide and US hedge fund Elliott Management have also invested in Sigfox, the sources said.
Sigfox's network covers France, Spain, the Netherlands and 10 of the UK's larger cities. The money raised on Wednesday will finance a roll out in the United States, Latin America, Japan and South Korea with the help of its new corporate investors, which have also signed commercial agreements with Sigfox.
The company currently has several millions of objects connected. In Spain, it has equipped five million flats with anti-intrusion alarms with its partner Securitas Direct.
Sigfox builds low-energy, low-cost wireless networks to connect objects such as electricity meters, smart watches or washing machines, providing the infrastructure that makes the so-called Internet of Things possible (IOT).
Such objects emit small amounts of data at a time and need to be constantly on, so Sigfox is betting that its technology is better suited to this than existing mobile networks owned by telecom operators.
That Telefonica is backing Sigfox signals confidence in its technology, and also turns a potential rival into an ally. For industrial gases supplier Air Liquide, teaming up with Sigfox will allow it to track gas bottles all over the world.
Having a financial partner like Elliott will also help the French startup build its credibility in order to win new markets, especially in the US, the sources said.
"They're like the Vodafone of the Internet of Things. They're not running the applications themselves, they're providing the network," said William Webb, chief executive of non-profit firm The Weightless SIG which lobbies for open standards in machine-to-machine-communication.
"They're the furthest along at the moment," he said, referring to others in the field such as Nwave and Senaptic.
Most investors are also looking to recoup their investment through a possible public listing of Sigfox in the coming few years, the sources said.
Sigfox currently charges one euro per object connected and is aiming to have at least 100 million of them by 2020, which would translate to 100 million euros in revenue from 3 million euros in 2014, one of the sources said.
In "The Internet of Things: Sizing up the opportunity", McKinsey consultants forecast that by 2020, the market for connected devices would be between 20 billion or 30 billion units.
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