Where are the UK wearables?

The past couple of years have seen an explosion in the wearable technology sector; from fitness and health trackers, to fashion, to education. Almost every major consumer electronics brand has either an established product line in the space, with new entrants appearing each month. And the industry is growing rapidly, with the sector calculated to be worth $5.8 billion by 2018, up from $2.93 billion, according to Transparency Market Research.

But the attention shouldn’t just be on Silicon Valley and multination tech giants. We’re seeing a growing contingent of young UK startups and high-growth companies focussed on wearables that are attracting attention, and indeed, investment.

Given that the sector is still in its early stages, it will come as no surprise that the vast majority of wearables deals have come at seed stage (and can therefore accurately be described as “startups”). Interestingly, well over half of these are unannounced, meaning in many cases, the companies in question are relatively under the radar.

One of the biggest sectors in this area is health and fitness, and while fitness trackers are probably the most well known type of device, they are by no means the only one. Take BioBeats for example; they produce devices that measure a number of biometrics of the wearer in order to provide them with coaching programmes to improve their health. Receiving a $2.28m fundraising in April 2016, they are valued at over £5m, remarkable growth in just four years from their foundation in 2012.

The largest single deal we’ve seen in wearables is not for a software or hardware developer, but a manufacturer of flexible electronics, used in wearable devices (and indeed many other applications). FlexEnable raised $300m back in 2011 from Oak Investment Partners and the Russian Private Equity firm Rusnano Capital, before being acquired by the same firm in 2015. FlexEnable has developed flexible electrophoretic displays, as well as malleable X-ray image and fingerprint sensors, and aims to revolutionise the production of portable devices and “active surfaces”.

Wearables aren’t just fashion accessories and fitness trackers; we’re seeing UK companies use the potential of wearable technology to improve healthcare. Inside Biometric manufactures devices used to self-test biometrics like glucose levels in diabetics. The company recently secured £616k, valuing them at almost £16 million – in a deal that was never made public. From monitoring to active treatment; Ambicare Health is a high-growth company developing wearables for medical and consumer healthcare applications. Valued at £4.3m from a fundraising back in 2013, the company’s devices treat skin conditions from spots and acne, to certain forms of skin cancer. Medical applications of wearables can also include mental health. London-based BioBeats has created a mobile app to help manage stress and anxiety. They raised £1.5m recently in a deal with AXA Strategic Ventures, IQ Capital Partners and White Cloud, valuing them at over £3.5m.

We’ve tracked £326m of investment in 90 separate deals into wearable startups and high-growth companies. Reaching a peak in 2015, the slight downwards trend since then (despite incomplete data from 2016) echoes the wider landscape of falling deal numbers across the board.

Wearables: Equity fundraises (January 2011 – August 2016)

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