D-Insights leverage Draup’s proprietary data, research, and analytics to identify emerging trends in technology and talent. You can get insights on a variety of themes such as disruptive technologies, emerging business trends, outsourcing patterns, global R&D landscape, emerging talent trends while also understanding various market shifts and indicators.
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Apple’s outsourcing trends
Apple has undertaken many outsourcing initiatives due to its penetration into the healthcare and services sector. Although Apple is in the Nascent stage of developing healthcare solutions, its partnership initiatives signal that the solutions can be offered to all providers. These providers range from medical device companies to hospitals that can use Apple’s platforms and software for better healthcare.
Apple has already emerged as one of the major enterprise cloud service providers. High volume of data that floods the cloud need to be cleaned and transformed into data lakes and that’s where the role of service providers comes in.
14th August, 2019 -
Service providers in Automotive Digital Cockpit
The auto electronics vendors are redefining their HMI offerings with increasing penetration of digital cockpits. The major digital cockpit features integrated by OEMs to enhance their vehicle USP include a holographic display, haptic feedback systems, gesture and speech recognition systems among others. BMW, Renault, Volkswagen, Skoda, among others are some of the OEMs in this sector and tech giants like Apple, Microsoft, Amazon, and Google are investing in automotive digital cockpits.
Luxoft and Intel co-developed a solution for a new Automotive Reference Platform (ARP), designed to power the Digital Cockpit of next-generation vehicles. The ARP is based on a new high-performance computing architecture, designed in collaboration with technical experts from Intel. It was created to make it easier and faster for leading OEMs and suppliers to develop hardware and software solutions for the digital cockpit.
13th August, 2019 -
Growth of Global EdTech Firms
EdTech start-ups are leading the innovation in the education sector by leveraging latest technologies like AI, NLP, and Analytics and collaborating with institutions that are incorporating the latest digital technologies to give their students a better educational experience. EdTech startups will continue to attract VC funding as the untapped online learning segment gives enough space for these companies to grow.
EdTech firms such as Byju’s, Coursera, and Udemy among others have a huge market base on account of its offerings ranging from PreK-12 to CAT, arts, business studies & personal development. iTutorGroup, an online education and training platform provides a personalized learning solution to students and professionals using technologies like Big Data and Web/Mobile apps to integrate solutions such as AI tutor.
8th August, 2019 -
Tech giants in automotive digital cockpit
Tech giants such as Apple, Google and Microsoft, among others, are heavily investing in automotive digital cockpits which is touted to change the way we drive. Integration of personalized settings, android features and voice enables navigation are key solutions that trigger partnership.
LG collaborated with Microsoft to utilize Azure’s cloud and artificial intelligence (AI) capabilities to grow its autonomous vehicle and infotainment business. Cross-vertical collaborations have accelerated the evolution of vehicle cockpits especially with the virtualization and development platforms.
30th June, 2019 -
AR & VR: Trends and Opportunities
AR/VR will continue to see a lot of traction in the consumer sector owing to successful immersive experiences in gaming and retail. However, mobile AR will witness a bigger spectrum of opportunities in the future due to the absence of high setup costs, as is the case with VR. Major tech giants like Google and Apple are investing in AR via ARkit and ARCore, to allow iOS and Android developers to develop solutions.
Companies are partnering to integrate AI and AR which will open gates for physical environment interaction on a multi-dimensional level. Unity has partnered with IBM to launch IBM Watson Unity SDK, programming interface which will allow developers to add cloud-based AI on their applications.
12th June, 2019 -
Automotive: Analyzing autonomous vehicle technology spends
Automotive
Major auto giants and technology firms are fueling the automotive vehicle ecosystem with healthy investments. Majority of the engineering spends by automotive firms is on enabling autonomy. GM, Tesla, Ford, Waymo, and Uber, are the top players in the autonomous vehicle's ecosystem who are investing heavily to deploy their autonomous vehicles
. The engineering spends by these top 5 players are largely focused on developing full stack solutions, robust sensor systems and advanced computing platforms for vehicle control.
22nd May, 2019 -
Hospital IT: Service Provider Opportunity Analysis
The hospital industry has seen revenues to the tune of 45-50 billion over 2018 with almost 45 percent of that revenue being generated by the top five service providers. Technology service providers, with their expertise in RPA and analytics are emerging as digital partners to hospitals.
One such partnership has been between IBM and Cleveland Clinic, making it possible for thousands of network ports to feed into a wide range of devices all over the hospital building, revolutionizing healthcare.
7th May, 2019 -
Identifying Top Digital Use Cases in the Hospital IT Ecosystem
The digital hospital framework consists of multiple themes, use-cases, and opportunities across all aspects of patient care and administration. Connected hospital, EHR Analytics and remote/virtual care are some high opportunity areas and have emerged as top use cases in the hospital IT ecosystem.
Analytics, RPA and app development are key service partnership areas that technology partners can focus on.
24th April, 2019 -
Tracking Hospital IT Spend Patterns by Region
Over 70% of all digital investments in the hospital industry are consolidated in the US and Europe. International hospitals and healthcare facilities have chosen the US, UK, Germany, and more recently China and India as major hotspots for digital centres thanks to a favourable regulatory and technological ecosystem.
Several reforms such as the HITECH Act and PPACA, have led many providers to invest heavily on digital IT tech within the US which makes it a key global decision-making region. Hospital IT spends in the Asia-Pacific region are also increasing due to high adoption of digitization in the industry by countries such as China and Japan.
23rd April, 2019 -
Understanding the Hospital IT Landscape
The digitalhospital ecosystem in the US is thriving with private hospitals investing heavily to build full-stack clinical and administration capabilities. This has paved the way for several collaborative efforts between healthcare facilities, tech giants, and startups.
Hospitals in Texas, California, and Boston are benefitting from the rich technology and research ecosystem making them prime partnership targets. Governmental health organizations are also collaborating with tech-giants and healthcare providers to increase the adoption of advanced medical systems.
11th April, 2019 -
Global Hospital IT Spend
The globalhospital IT spend was estimated to be in the range of $250-280 BN as of 2018. Digitizing patient care, Connected EHR/EMR and predictive analytics are prime areas of investments by hospitals. Over 55% of investments are in the top 5 areas of pain management, EHR, EMR, precision medicine, health analytics, and medical devices.
. Healthcare providers are investing heavily in digital data solutions to build an infrastructure that can present, record, and store patient information, and make it accessible from virtually any facility. Healthcare providers are also focusing more on healthcare IoT in recent years for population health management and patient monitoring.
4th April, 2019 -
India Has a Rich ER&D Outsourcing Ecosystem
India has a rich ER&D outsourcing ecosystem with Bangalore city home to the highest volume (~48%) of outsourcing activity. The total ER&D outsourcing spend for 2018 stood at $2.17 bn with automotive accounting for a dominant share of the spends.
Consumer software, enterprise software, aerospace, and telecommunications are the next big spenders signaling massive opportunities for service providers across verticals. Top outsourcers include Daimler, Tata Motors, and GM.
27th February, 2019 -
China Automotive ER&D Spend Patterns
China’s automotive market is seemingly immune to the global decline in passenger cars. The total automotive R&D spend in China was close to $8 bn as of 2018 with Chinese firms accounting for 53% of the investments. ER&D market addressed by service providers in China accounts for more than $ 2 bn.
There are several opportunities for service providers across the value chain with Body Engineering and Safety Restraints being the most dominant segment. The total revenue from China's automotive market stood at $600Bn at the end of 2018.
14th February, 2019 -
R&D Spends In China
R&D spends in China are expected to grow by a CAGR of 18% over the next 4 years and these investments are driven by the telecom and auto industry. The automotive vertical accounts for 15% of the total G500 R&D spend in China signaling the need for service providers and technology partners.
The top 5 service providers of EDAG, Altran, Tech Mahindra, ESG and ALTEN account for 70% of the overall engineering services market. The body engineering and safety restraints segments have a high outsourcing propensity and contribute nearly ~40% of the revenue among the top 5 SPs.
5th February, 2019 -
GLOBAL R&D CENTRE DISTRIBUTION OF AUTOMOTIVE COMPANIES
Over the last decade, the emergence of automotive R&D centres has seen a sharp spike; resulting in the formation of newer R&D hotspots. Globally, India and China are home to one of the largest markets for R&D centres. In 2006, China had about 98 engineering centres, which has nearly double in 2017 to about 174 centres growing at a CAGR of 5.9%. India has increased its share from 34 to 63 over a span of ten years, growing at a CAGR of 6.3%. India has low-cost software talent availability, and China is favourable for low-cost manufacturing and has access to a large market.
. Other locations that have seen a significant rise in R&D centres are California, Michigan, Western EU, and Japan. Western US locations of California and Washington have over 61 centres, growing at a CAGR of 3.8%, while the Bay Area has over 23 centres as of 2017. Japan also has a high number of R&D centres albeit with a low CAGR of 0.9%.
Source: DRAUP Data Platform, Annual Reports
4th January, 2019 -
The Growing UK Automotive R&D Landscape
The UK’s automotive R&D spends are still in its infancy accounting for just 6% of the global spends. Jaguar Land Rover, Tata Motors, Geely Global and ZF Group is the current top spenders in this segment.
The R&D spend is highly consolidated among these top three and account for nearly 70% of the total. Most of the spends are focussed in powertrain and body engineering, with infotainment and safety features being the next highest contributors.
Source: DRAUP Data Platform, Annual Reports
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Digital Spending In The Banking Sector
The total technology spends in the banking industry is estimated to be $255-261 BN as of December 2018. Digital spending in the banking sector is highly consolidated among the top 30 banks with JP Morgan Chase, Wells Fargo, and Citigroup emerging as top spenders.
A look at spending patterns by geography reveals that North America accounts for 38.7% of the total spend. Startups that develop end-to-end use case solutions in Analytics, AI, Cloud and Blockchain are prime investment targets.
Source: DRAUP Data Platform, Annual Reports
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CYBERSECURITY: TACKLING A POTENTIAL $6 TRILLION PROBLEM
Yahoo (2013), Target (2014), and Deloitte (2017) have all been victims of cyber attacks that have cost them millions in lost revenue, compromised sensitive consumer information and caused priceless damage to their reputation. Cyber incidents targeting businesses have risen to ~150,000 from the 82,000 recorded in 2016.
Cyber-attacks are estimated to cause $6 trillion in damages by 2021 and these startling numbers have caused industries to increase global spending on cybersecurity initiatives.
Source: DRAUP Data Platform, Annual Reports
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AUTO FIRMS IN THE BAY AREA ARE REDEFINING THE FUTURE OF MOBILITY
Automotive companies are either acquiring companies or investing in ER&D centres in the Bay Area The Bay Area has become a hub for new-age automotive technologies. This trend is not just limited to traditional automakers, but also new age OEMs and ride-sharing companies. Enterprises such as Tesla, Uber and Lyft, headquartered in the Bay Area, are giving traditional automakers a run for their money.
Auto firms in the area are focussing on autonomous vehicles, electric vehicles, connected cars and mobility. Tesla Motors, Uber, and Lyft are the top three automotive companies investing heavily in ER&D centres and making strategic acquisitions. The total acquisition deal size is estimated to be USD 5-6 billion, and the total automotive ER&D spend is approximately USD 0.5-1 billion.
Source: DRAUP Data Platform, Annual Reports
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TALENT LANDSCAPE ANALYSIS FOR ANTI-MONEY LAUNDERING
The global money laundering problem is costing industries up to $2 trillion per year. This accounts for 2-5% of the global GDP, and only 1% of the global illicit financial flows are seized. Record-breaking fines are being imposed on firms caught on violating the anti-money laundering laws.
AML talent in the US, UK, and Canada is predominantly employed by US-based financial institutions. The global demand for AML talent is approximately 370K, of which 310,000 is employed in Banking & Insurance Companies, 18,000 in Investment Banking, Management Consulting, Audit & Tax related companies, and 10,000 in AML Software Providers and ITeS Service Providers (SPs).Roles such as AML KYC Analyst and AML Analyst are the most sought-after positions which account over 50% of the total demand. This is followed by Risk & Regulations Management and ALM Sanctions Analyst roles. While Compliance AML KYC Analyst and AML Analyst roles are the top hired workforce in top AML talent hotspots like New York, London, Canada, UAE and Singapore.
Source: DRAUP Data Platform, Annual Reports
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MEDICAL DEVICES’ GLOBAL R&D PRESENCE
The expansion of R&D talent footprint globally over the past 4 years is rapid, with India and Bay Area emerging as the hotspots. The medical devices’ industry is aggressively expanding its global presence by investing in R&D centres. The R&D investments in India and China have been growing at a rapid pace thanks to their competitive advantage. Companies are leveraging the opportunities at these locations to develop imaging and non-imaging diagnostic solutions.
The Bay Area is also fast emerging as one of the top hubs in this sector. With tech giants building software-centric solutions, the area is well on its way toward becoming a rich medical device hub. Thermo Fischer and GE Healthcare have opened software COEs in the area. Suzhou and Shanghai are at the heart of China’s R&D growth. Fresenius, Medtronic and Thermo Fischer are amongst the top medical devices’ companies that have opened multiple R&D centres in China. India’s GICs are highly empowered allowing them to engage in strategic partnerships with vendors. Medicaldevices companies are primarily investing in Bangalore and NCR.
Source: DRAUP Data Platform, Annual Reports
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China Are Leading The 5G Implementations Race
China are leading the 5G implementations race and recently outspent the US to create a wide gap on 5G infrastructure & implementation A recent report revealed that China is miles ahead compared to the US and the rest of the world with regard to 5G infrastructure and implementation.
Analysts noted that the cost of equipment is roughly 35% cheaper in China when compared to the US. China is stated to have over 400 million 5G connections by the end of 2025. This comes as no surprise as China has over 10 times as many 5G sites as the US. Though full-scale implementation is at least a couple of years away, it’s safe to say that China is already on the road to winning this race.
Source: DRAUP Data Platform, Annual Reports
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Unicorn Exits Set To Reach All- Time High In 2018
A lot of startup-related metrics such as, Supergiant rounds, Unicorn investments, Total Funding etc are on track to hit multi-year or record highs in 2018 The 2018 numbers provide a clear counterpoint to those who questioned whether astronomical unicorn valuations would hold up in the public market A record number of venture-backed companies (23) valued at over $1 billion have launched IPOs so far in 2018, outpacing full-year totals for 2016 and 2017.
These newly public unicorns are doing pretty well too, their shares are either meeting or above expectations and 6 of these are valued at over $10 Billion. Unicorn M&A market is seeing tremendous activity as well. Big transactions like Walmart’s $16 billion acquisition of Flipkart and Microsoft’s $7.5 billion purchase of GitHub have helped boost the totals. The UnitedStates produced the most Unicorn exits this year but the total dollar value of these exits was higher in Asia and Europe.
Source: DRAUP Data Platform, Annual Reports
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Samsung's Pivot from Mobiles to Semiconductors
Samsung Mobile has lost its leadership position in the 3 biggest markets while the Semicon Business Unit has displayed hockey stick growth in Revenues
Samsung Semiconductor has a 52% operating margin and contributes to nearly 75% of the total operating profit
Samsung generated more profit in 2017 than in 2016 + 2015 full years combined. This is a phenomenal growth story for Samsung Electronics as the bulk of the growth in the top and bottom lines is not driven by the mobile division but the semiconductor division. The was mainly caused by the shift to higher storage capacities (that started with Apple’s iPhone and was also adopted by Chinese brands) have kept the demand for Samsung memory parts at an all-time-high. Simultaneously, Samsung has lost its leadership position in the Indian, Chinese and American smartphone markets leading to declining revenues from the Mobile Communications BU.
Source: DRAUP Data Platform, Annual Reports
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Analyzing the Impact of AI
Sales prediction, market intelligence and customer experience are the most impacted business segments
There is no discounting the impact AI has had on all business functions. Sales has had some of the highest adoption of AI technologies to enable Forecasting, and PredictivePricing. The big 5 CRM players Salesforce, Microsoft, Oracle, Adobe and SAP accounted for more than 50% of the global CRM market. AI has also helped to streamline and enhance customer service experiences through the introduction of chatbots and virtual assistants. ML and NLP are the most used AI technologies in CRM solutions.
Source: DRAUP Data Platform, Annual Reports
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FinTech companies in the United States have invested over $15.2 Billion in 2017
There are roughly 7000 FinTech firms around the world that are trying to bring disruption to the Finance ecosystem. InsurTech, RoboAdvisory and AlternativeLending are the domains in FinTech that are witnessing the most disruption.
FinTech investment has targeted the most profitable areas in global banking such as PersonalFinance, Insurance and AssetManagement with investment share of 73%, 10% & 10% respectively. Firms with the highest deals by value are Bankrate, BluePay and ISS.
Source: DRAUP Data Platform, Annual Reports
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Ranking Companies By Revenue
24 Energy companies are present in the Top 50 by Revenue per Employee among S&P 500 members
Healthcare (10 companies in the top 50) and Utilities firms rank a distant second and third respectively Ranking companies by Revenue per Employee allows us to explore how efficiently the companies utilise their HumanCapital. Energy cos are advantaged by the fact that their businesses depend more on the availability and efficient processing of natural resources which can be automated. On the other hand, a Healthcare or FinancialServices company is more reliant on human based operations to generate income.
Source: DRAUP Data Platform, Annual Reports
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Apple's Share Price Hit $207.32 On August 2nd
Apple's Share price hit $207.32 on August 2nd, making it the first technology company to hit a market cap of 1 Trillion dollars Apple become the third public company in recent history to cross the 1 trillion mark after StandardOil and PetroChina Apple's market cap does not make them the biggest company in history, that honour belongs to the DutchEastIndiaCompany who had an inflation adjusted market cap of 7.4 trillion dollars at it's peak.
The two companies are incomparable but with the upcoming release of the latest iPhone, it will be hard to bet against Apple continuing it's growth trajectory.
Source: DRAUP Data Platform, Annual Reports
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Sustainable And Renewable Energy Sources Are On The Rise
Over the last ten years, the fraction of power generated from coal has nearly halved from around 50% to 30%. Over the same time, renewable power sources like solar and wind have grown to make up 15% of total electricity generation.
The rise in renewable power sources is set to receive a further boost with the adoption of ElectricVehicles. Electric vehicles produce less emissions now because, in general, the electric grid is getting cleaner. While we are moving in the right direction with renewable power and growing numbers of EV models, it’s vital that we accelerate the adoption of EVs to negate the effects of ClimateChange.
Source: DRAUP Data Platform, Annual Reports
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Google search's market share is at its lowest point in the last decade
In comparison, Bing is at it's highest point due to it's ability to partner with third party programs Google has had a stranglehold on the SearchEngine market since it's inception in 1997.
Their market leading advertising services only made them more dominant, but, since the start of 2010, Bing's aggressive focus on UX and partnerships has seen it grow at a faster rate. For example, ~25% of the searches on Bing are voice driven, mainly through it's integration with Siri and Cortana.
Source: DRAUP Data Platform, Annual Reports
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Bitcoin Price Peaks And Falls Correlates With Googles Search Interest
The tremendous growth in Bitcoin throughout 2017 correlates almost perfectly with an increase in Google search interest This is a clear indication that the rise in trading price was not facilitated by a rise in the value of Bitcoin An "economic bubble" is trade in an asset at a price or price range that strongly exceeds the asset's intrinsic value. As can be seen in the graph, the price of Bitcoin rose from ~15% of it's max value to it's max value in the space of a year.
This rise was matched by a corresponding increase in Google search queries. The price of a Bitcoin then drops by ~50% when the "fad" cools, as shown by the drop in number of Google search queries.
Source: DRAUP Data Platform, Annual Reports
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ADVERTISING IS GROWING MORE AND MORE CENTRAL TO ALPHABET
For the first time in the last 10 years, Advertising has been mentioned considerably more times than Search In the past, Advertising has at most 2 mentions more than the mentions of Search The increase in mentions of Advertising is a signal of the changing core of Google's business.
Their search app is still the most used service on the internet but much of their revenues are driven by their advertising business and as a result, advertising is set to become increasingly critical to the future of Google.
Source: DRAUP Data Platform, Annual Reports
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Google's Social Network Timeline
Mentions of Social Network in Google Earnings Calls last peaked at the release of Google+ in 2011 Since then the mentions have steadily decreased and there has been no chatter in the last 2 years after Google+ was spun-off Google's social media plays were a direct response to the threat posed by Facebook.
The primary reason that their initiative failed is that instead of solving problems for their users, Google's social media features were mainly introduced in competition to a feature launched by Facebook. As a result, Google+ only provides value by being a single sign-in source for other Google services.
Source: DRAUP Data Platform, Annual Reports
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Amazon's growth story in a single chart
It took Amazon 18 years as a public company to catch Walmart in terms of market cap but only 2 more years to double it.
On May 15, 1997, a money-losing online bookstore, Amazon.com, went public on the Nasdaq in an IPO that valued it at a modest $438 million. 20 years later, that startup is worth nearly $460 billion. To achieve this feat, Amazon directed nearly all of it's cash into huge new investment areas, with a focus on growth over net income.
Source: DRAUP Data Platform, Annual Reports
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Fords' Ev Focus In China
Mentions of China in Ford Earnings Calls has been rising rapidly since 2013 and peaked when China announced tax rebates for Electric Vehicles in 2015 In December 2017, Ford announced the launch of 50 new models in China with 15 of these being electric
Ex-CEO Alan Mullaly had tried to streamline Ford's product line when he took over in 2006 by focusing on fewer vehicles and trying to improve efficiency. Since his retirement in 2014, Ford has made a U-turn on this strategy and are instead trying to boost sales by adopting an aggressive product and tech strategy in emerging markets such as China
Source: DRAUP Data Platform, Annual Reports
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Companies studied- BMW, Ford, FCA, GM, Volkswagen
Mentions of the Apple Car project in Auto OEM Earning Calls saw it's peak in 2015 and 2016 when the project was still shrouded in secrecy In 2017, mentions dropped by more than 50% when Tim Cook announced that Apple would focus on building an Autonomous driving platform and not a complete vehicle
Mentions of "Apple", "Apple Car" and "Project Titan" steadily grows from 2014-2016 when the program was still in stealth mode. The mentions suddenly drop to 0 in the first half of 2018. This dip correlates well with the news of Tim Cook pivoting the goal of the program towards building an ADAS platform. This indicates that OEMs are no longer as worried about the Apple Car and are instead looking to partner with the Tech Giants.
Source: DRAUP Data Platform, Annual Reports
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Microsoft Product Analysis
Microsoft have pivoted from mentions of Consumer products to talking about enterprise platforms such as Azure and Office 365. This highlights the company's policy of prioritising the Cloud and Enterprise markets. In 2011, Microsoft’s two favourite products to talk about were Office and Windows.
Since then, Office has continued its evolution into Office 365, a cloud-based platform and a vital part of the Microsoft ecosystem. Azure also grew from nothing into Microsoft’s biggest money maker and probably the most important component of Microsoft’s future. Meanwhile, Microsoft's consumer products such as Bing, Xbox, Skype and Windows have seen their mentions dip to their lowest point since 2011.
Source: DRAUP Data Platform, Annual Reports
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What is the future of Windows?
We performed a Sentiment Analysis of all Microsoft's Earnings Calls and aggregated the sentiment of every statement that mentions the "Windows" product line. Post the emergence of Azure in 2011, a little bit of negativity has snuck into the language of Microsoft executives who discuss Windows. The change in sentiment is clear indication of Windows' dwindling significance to Microsoft.
Windows is at the heart of Microsoft and as a result the languages is largely positive in nature. However, since 2011, Microsoft have started tempering their expectations of this product line and we have seen some negativity sneak into their language. The magnitude of negativity is still minimal but the fact that it starts at 2011, the same time that Azure and Office 365 begin their growth trajectories is very significant.
Source: DRAUP Data Platform, Annual Reports
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Automotive OEM Earnings Calls Has Grown Exponentially
Mentions of Ride-Sharing, and related companies, in Automotive OEM Earnings calls has grown exponentially over the last 5 years. While these companies are talking more about their RideSharing initiatives, the positivity around these statements has steadily declined. Between 2010-15, Auto OEMs were hesitant to talk too much about the "Ride-Sharing Revolution".
However, they were largely positive about the segment. Uber's successes in this period forced the OEMs to make their own entrance and as a result the mentions of the sector grows significantly post Uber attaining Unicorn status. Lately, Ride-Sharing has entered a period of quiet consolidation with mergers and partnerships being brokered by the likes of SoftBank Group and other major players.
Source: DRAUP Data Platform, Annual Reports
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Google is coming
Mentions of Google & Waymo in Automotive OEM Earnings calls have seen consistent peaks and falls that correlate with milestones passed by the Google project The sentiment associated with these mentions has largely been positive but average magnitude of positivity has been falling since 2016. Automotive OEMs started recognising Google as a major player in AutonomousVehicles when they began testing their prototype in mid 2014.
By 2016, Google's program had already successfully completed the first Autonomous ride when OEMs began their own entries into the market ( General Motors invested in Cruise Automation). Mentions hit an all time high in early 2017 as Waymo was spun into a separate BU and and began stealthily focusing on building partnerships and working on their Go-To-Market strategy.
Source: DRAUP Data Platform, Annual Reports
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Analysing Global Unicorn Hubs
Unicorns have emerged in most technology hubs like Brazil, Indonesia and Nigeria. It’s no surprise that the BayArea is home to over 50% of the world’s Unicorns. The Bay Area has a mature start-up ecosystem that is focused on technology innovation which has made it a breeding ground for Unicorns. The area also has significant financing options from institutional investors.
. China has a mature start-up ecosystem and is producing Unicorns at a rapid rate. DidiChuxing and Xiaomi are some examples of well-funded Unicorns. Israel and UK have a strong start-up ecosystem with a focus on new age technologies while Western Europe has a focus on mechanical and embedded engineering
Source: DRAUP Data Platform, Annual Reports
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Automotive Has The Lowest R&D
Automotive has the lowest R&D Spend (as a percentage of revenue) across vericals. As a result, the disruption currently plaguing the industry cannot be a surprise.
. Larger R&D investments by software and semiconductor companies is a direct cause of their disruptive power.
Source: DRAUP Data Platform, Annual Reports
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China's Dominance of the Top 10 Biggest Companies
4 of the Top 10 biggest companies in the world are Chinese Banks with PetroChina as a 5th representative. The top 10 companies in the world have been dominated by BFSI and Energy firms and mainly by those from the UnitedStates.
. Traditional American Banking powerhouses were decimated by the financial crisis of 2008, paving the way for Chinese Banks to rise to the top, underscoring the incredible growth story of the country. The assault of China to the Top 10 of each industry is limited, at the moment, to sectors like banking, materials, construction, telecommunications and trading. UnitedStates, Europe and Japan (G7 economies) still dominate the top positions in sectors where the brand or high technology is the key but China is catching up on that front too.
Source: DRAUP Data Platform, Annual Reports
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Israel Automotive Startup Funding
Israel’s automotive startups account for over 43% of the total funding received by all startups in the country. Of the total $3.2bn in funding received by startups, $1.4bn was bagged by the mobility services sector.
New age technologies like autonomous vehicles and electric cars have witnessed the biggest funding rounds. Israel has a well-developed autonomous tech ecosystem. Startups are mainly working on AI and sensor technologies. Israel’s government has done it's part, slashing electric vehicle taxes by 10% and is actively promoting EV and clean energy.
Source: DRAUP Data Platform, Annual Reports
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Israel - Next Big Automotive Innovation Hub
The rise of Israel as a leading tech nation has popularised the nickname, ‘Silicon Wadi’. With a YoY growth rate of nearly 78% in the number of automotive startups, Israel’s startup ecosystem has seen a massive boom in the last two years.
The tech ecosystem has been rapidly expanding, largely driven by Israel-based tech startups. Larger companies have set up accelerators to promote & leverage the emergence of these startups. Mobileye's $15bn acquisition by Intel Corporation has raised awareness of the significant capabilities of the nation’s tech talent.
Source: DRAUP Data Platform, Annual Reports
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Who's really driving the growth of IoT?
By 2022, IoT is set to account for over $410bn in technology spend across verticals & locations Internet of Things technologies are making big waves in the digital transformation of several industries. Of these, industrial, automotive and "smart city" projects have emerged as the leaders, accounting for about 57% of the total spend by 2022.
IoT is the driving force behind smart city projects around the world. Predictive traffic management, sensor-enabled streetlights are some notable use cases.
Source: DRAUP Data Platform, Annual Reports
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An Interesting Battle Is Underway
An interesting battle is underway in the Auto industry to see who will redefine the future. Ridehailing companies won the first round by adopting software earlier than their rivals. However, they too have recognized that the future of the industry lies in the ability to provide software services on top of the core vehicular platform.
These companies have acquired many companies to build competencies in areas such as Food Delivery, Auto-financing & Rental services. Traditional Automotive Cos have recognized the value of building a software based ecosystem around their core offerings. This is evidenced by the increasing number of consumer software companies that Auto OEMs are investing in/acquiring.
Source: DRAUP Data Platform, Annual Reports
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The Changing Automotive Industry
Over 50% of total investment & acquisition activity by General Motors has taken place post 2015
The changing Automotive industry has forced GM to move away from acquiring companies that help make cars better to making investments that insulate the company from future disruption The chart describes companies that GM invested in or acquired tagged to sub-vertical and technology.
Source: DRAUP Data Platform, Annual Reports
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Outsourcing Intensity of Indian R&D Centres
The trend line indicates that companies first set up an R&D center in a global location to build a relationship with the surrounding partner ecosystem. As the center scales, the total outsourcing begins to regress in proportion to the growth in headcount.
This indicates that companies start to bring more work in house as their capabilities grow. Exceptions to the rule are companies headquartered in India as shown by Tata Motors in the chart.
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Autonomous Vehicle Investment Outlook
Software and semiconductor powerhouses are committed to investing heavily along with OEMs to develop strong ADAS platform capabilities. Tech giants such as Google, Baidu, Inc. and Microsoft are focused on building AI platform capabilities by leveraging deep learning algorithms that make ADAS safe and predictable.
Among OEMs, Ford Motor Company is best positioned to launch its SAE Level 5 capable-vehicle in the market, a vehicle that requires no human intervention. Key investments and collaborations with Argo AI, Velodyne LiDAR, Inc., SAIPS etc have enabled Ford to develop this capability. Toyota Motor Corporation too has pledged over $1bn into technology developing an AutonomousVehicle .
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Smartphone Era
In the early days of the "Dot-Com" era, companies like Microsoft and Apple spent their resources on acquiring software companies that had already been in business for a 3-4 years.
Post-2005, in the "Smartphone Era", Microsoft and Apple were joined by other Tech Giants such as Facebook, Google and Amazon. This time period saw acquisitions in Vision and Machine Learning grow substantially. Apple acquired facial recognition software firm Polar Rose while Google acquired Key-Hole and Zip Dash to enhance their Google Maps offering.
Since 2011, the "Cognitive Era" saw these Tech Giants become increasingly ambitious when it comes to making strategic acquisitions. The Tech Giants acquired a number of early stage AI start-ups. For example, Apple acquired the team at Init.ai, while Google acquired 2-year old AI startup, Deep Mind.
