Wyze Raises $110 Million, Aims For World-Class AI Cameras

By John Honovich, Published Aug 02, 2021, 10:52am EDT

Wyze has raised $110 million, more than 3 times its total previous VC funding, as the company, with fast top-line growth, has struggled with low gross margins.

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Inside this note, we examine this new round, the challenges the company faces, what it aims to do with this funding, and the opportunity it has in video surveillance.

Compare to other large recent rounds - AnyVision Raises $235 Million and Flock Safety Raises $150 Million, Lead By A16Z.

Transformative ****** ** *******

**** ******* ******* **** to **** * ******-**** outlook *** *** ** so ******* ** ******* a ********** ** ********. Prior ****** $*** ******* *******, **** *** ******** just ~$** ******* ******** in ******* *** *** company's ***** ~* *****.

Hodgepodge ** ********

***** **** ******* **** surveillance *******, ** *** last * ***** *** company *** ******** * variety ** ********, **** of ***** ********* **** of * **** ****** style **** ** *** developer, *.*., ***** ******, masks, **********, ******** ****** cleaners, ***.

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*** **** **** *** Wyze ** **** **** established * ******** ***** and **** ************ ****** often ****** **** **** masks, ***** ******, ****** cleaners, ***. ******.

Revenue ********* - $*** ******* *** ****

**** ********* $** ******* in **** ******* *** we ******** ~$*** ******* in **** *** ~$*** million **** ****. *** company ******* ********* ** grow ***-**** ******* ** an ***** ** ******* products (*.*., ** ********~$** ******* ** ***** vacuum ******* *** **** ****).

***** ********* *** ******** are ************, **** *** very *** ***** *******, e.g., **** *** **'* gross ******* *** ~*% and ******* ***** ******* are ***** **% (********* ** ********** ** this *****).

Valuation ********* - $*** ******* ** $* *******

** ******** ****'* ********* is ********** *** ******** to ***** *******, ** the $*** ******* ** $1 ******* *****. **** is ******* **** ****** of ****'* ******* ** subscription (** ******** **** than *%) *** ******* of *** *** ***** margin, ************* ****** ** almost *** **** *****.

**** ** **** **** difficult ** ***** ***** it ** * *********** of (*) * ***-****** widget ******, (*) * relabeller ** ******* ********, and (*) * ************ business. *** ************ ******** has *** **** ****** to ********* ********* *** is ********* *** ******** part ** *** ****'* business.

Going *** ** ******** **** *********

** *** ******** ****, Wyze's ******* **** ** imminently ***** *** ** business ** ********* *** to **** *******, *.*., just * **** *** when**** ********* ******* ******* ******** ********* for ****:

***bad **** ** **** **’* **** ********* to run, and the costs are recurring. We greatly *****-********** *** ******* ***** ***** when we started working on this project last year (we’ve also since hired an actual finance guy…). The reality is we will not ** **** ** ****** ***** ***** *** **** ** ********. [emphasis added]

Investing **** **-****** ********

***, **** **** *** $110 ******* *****, ************** ** ******** ****:

** *** ******** **** and ********* ******* ** build *****-***** ********** ************ into *** ****** ********

**** ** ********** **** Wyze's ********* **** *** **** they ****** $** *******, ****** *** **** of **** ***** **** them ** ************* **** within **, * **** expensive **** ** *&*.

Million ******* *******

* **** ***********(***** ************ ** ******* at $** ** $** per ****),**** *** ********** ******* ******* *** using **:

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****** ******* ************ ******* then ** ** $** million *****. *******, ******* Wyze's ****** **** *** so ***, ** ********** that *** ***** ******* are ****** ****** (*** 50%) ****** ****** **** Wyze's ********* ******* ***** margins.

10 ******* ***** ******* ****

** ******** ** ******* total **** ** ******* have **** **** ***** on ** ***** ******* **** **** ***** that**** * ******* ******* had **** **** *** factoring ** ******* ***** throughout ****.

**** ***** **** ~**% of **** ******* *** using *** **** ************ plan. ****'* ********** *** but *** **** *** only **** ******* *** a **** ** ****** rate **** ********* ********, though ******* **** ** ultimately **%, **%, **%, etc. ******* ** ** seen.

Competition ****** ****

**** ***** ********* ****** competition, *.*., ******'* *** Blink ******* *** ********* promoted ** ****** ** similar ***** ***** ** Wyze:

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****, ***** ************ ** is ******* ******* ************* cameras *** **** **** than ****:

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Resolving ******* ********

******* **** **** **** they **** ******* ** customer ******* ***** **** **-******* ******** admitting** ******* ******** ** the **** ****:

****, ** **** *** customer ******* *** *** been ***** ** ***. It’s **** * **** one ** ******* ******* we *** *** **-****** and **** *** ********* this ** ** ******** customer *****.*** **** ** business ** *** ******* sets ****** ** *** quite * *** ********** on *** ******** ******* side ** ******. ** move **** *******, *** need ** ** * better *** ** ******* the ***** ****** ** place *** ******* **** the *********** **** **** to ** **********.** ******, with *****, ** **** seen **** ** **********, especially **** ***** **** to **** ****** ******** support ******, ***** ** why *** ******** ***** dropped ** ****. ** have **** ********** ****** as **** ** ** can, *** ********, ** the **** *** ****** our ******* ******** **** is **** **** ***** 12 *****. **** ** a **** ****** *****, but **’* **** ** make **** ******.

Jay-Z ****** ** *****

******* ******* ******* ** that *** ***** *** run ******* ******* ********, ***** ** **-******* by ****** ***-*. ***** there ** ** **** or ***** **** ***-* will ******* ** ******* Wyze, ** ** **** so, **** ***** ******* help ****, ** *** company ******* ********* ** word ** ***** *** does ****** **** *********.

Outlook - ************ ******** ******

** ****** **** ** focus ** ******* *** subscription ******** *** ***** its ******* ***** ******* (from ***** ****** ** masks ** **** ****** camera *****), ** ** hard ** ** *******.

*** **** **** *** Wyze ** **** **** have *********** * ********** well-known ***** *** **** a ********** ***** (*** growing) ********* ****** ****. If **** *** ******** to **** **** ****, increase *** ********** ** users *** *** ************* and ******* **** ************ features (*.*. **** **** facial *********** ** ****** soon), ** *** *** potential ** ***** * multi-hundred-million ****** ************ ******** in *** **** *** years.

Comments (13)

********* *** ********** ***** comes **** ******* ** leadership. **** *** ** Wyze **** ************. *** only ******** *'* ********** in ** *** *** cameras ********. *** *****, watch *** ***** ***** can **. *** **** about *** ** ******* there ** ***** **** for ********* ***** ****** products. *** *******, ******** local ******* **** **** to *****, ****** ***** times, ****** ***** ****** and ****** *****. * own **** *** ** and **** **.

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** **** ***** **** have * ****** ******** angle ** ***** ******* they ***** ** * lot ******.

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***** ***** ** ** news ** ***** **** Jay-Z **** ******* ** endorse ****…

***** ** **** ** a ***** ** *** previous ************ *****, *** in ***** ** *** sister-in-law, ***** ** * Wyze ******* ‘******* *** up’ *** ** **********.

**** ********** *****.

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Funny: 4

*'* ** ***** **** adopter *** **** * sizeable ********** ** ***** ecosystem. * **** ** least *** ** **** type ** ****** **** offer ** * ********* homes ********* ***** *********. I've *** * *** problems **** ********* ***** and *** ** **** a ** & *** replaced ***** ******** ***** went ********. ***** ********* need * *** ** work. **** ********** ******** the ***** *** & telephone *** ** ** neighbor's ***** **** ** a ****** **** * car ****** **. *'* guessing ****'** **** ** legs ******?

* **** * **********, a ****** ** ***** vacs, * ********* ***********, Wyze ****, * **** of ** **********, **** Sense ** (***** ****'** discontinued ******* **) *** a **** ***. *** in *** * ** pleased **** ***** ******** & *******, ******* ****** price *********. * **** Cam **** ** ** an ********** ********** ******* offering ** **** **** $1.25 *** ****** *** month. **** **** **** been ********** ** ******** wants *** *** **** part. * ***** **** should ***** ** ***** core ********** ******, *** stop ****** ** ***** anything **** *** *** their **** *** ** from *****.

*'* **** ** *** they ******** **** *** funding, *** ********** ***** changes ** ***** ******* and **** **** ******* to ** ***** *** of ***** ******** ****** company **********. "**** **** was ******* **** *** mission ** ****** **** quality, ****-**-***, ********** ***** home ********** ********** ** everyone. ** ******* *** things **** ** ***** packages – ****’* *** we ******* ** **********, easy-to-use ***** **** ****** that *** **** *** solve ****’* *********, *** and *****. ** *** can ** **********. *** watch **********."

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**** ******** * ***** about ***** **** **** and * **** *****. It's * **** ***** IMO.

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**** *****! * ** wish **** ***** **** a **** ***** ** ten ** **** ****** products ** ***** ** and *******. ***** *** the "***'* **** ******** and ********** ** *** possibly ***** **" ***** doesn't ******* *** **** confidence ** **. *****? Masks? ******-********** ****? **** makes ** **** **** the ***** ** *** on **** *** **** to ***** **** ***, the *******.

******** * ***** ** stuff ** *******......

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*** ********* ****'* ***** a **** ***...

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* ****** ***. **'* ok *** *** *****!

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******, *** *** ***********. I **** ***** ** to ***** ** *** dogs **** *'* *** home.

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** **** ** ***** when * ***** ** around ****. **** **** a ***** ***** * have.

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**! **, * ****'*. I **** *******, ***** bulbs, *** ***** ******* (that **** ***** ******). I ***** ****** **** focus ** ****** **** making ***** ******* **** a ********** *** **** than * ***** ** a ***. * ** guessing *** ***** **** do *** ** ******** ones ***** ******.

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****** *** ******** ******* were *** *** *******. Bad *********** *** ******** battery ****. * *****'* tried *** *** **** yet.

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* *****'* *** *** problems **** *** **** Sense ******* *.*, *** have **** ** **** in *** ******* ** the ****** ** ******* doors (*** ** *** liquor *******, *** ***** where * **** ** m&m's) *** *** ****** hosting *** ******** ** close **. ****** ***** great **** *** ***** side ** *** *****. I **** * ****** Wyze ***** *.* **** I ***** ******. *'** have ** *** ***** out *** *** ** they **** ********. *****'* tried *** *** ***** yet ******.

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