Apple Watch Venture In Residence

In just two weeks from now, the Apple Watch finally comes to market after months of anticipation and speculation. You may recall back in November, Apple released its WatchKit SDK to developers and companies to ensure there would be a large selection of apps when the wearable computer hits the market. In fact, Tim cook wrote in a memo earlier this week that more than a thousand apps have already been submitted to the App Store. Based on intuition and early screenshots, many of the initial apps will be geared towards communication, news, payments, transportation, health and productivity. Like with any new platform, it’s mind bending to think about the range of apps and services that we’ll now be able to access with a flick of our wrist. 

The big question that everyone’s asking is: Does Apple still have the magic to create a category defining product that will ship hundreds of millions of units? People much smarter than me believe Apple Watch will be a flop. Additionally, many of the early reviews have been mediocre because the user interface has a steep learning curve. Taking a contrarian angle is understandable given we’ve become tethered and addicted to our smartphones and Apple Watch feels like a nice to have rather than a must have. I personally struggle with making predictions and betting against Apple before a single unit has shipped. What I do know today? Thousands of developers are building apps, Apple Watch is beautiful and hyper personal, and Apple is putting all of its marketing might behind the launch. In my limited experience, that’s a recipe that I probably wouldn’t bet against.    

Given the developer interest we’re seeing, I strongly believe that thousands of watch-specific apps will emerge over the next few years and several large companies will be built on top of this new platform. I don’t pretend to know what the winners will look like and where value will be created but I do know that RRE Ventures is eager to learn and invest in the ecosystem.  As part of this process, we’ve decided to establish the RRE Venture In Residence Program which will initially focus on Apple Watch.

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The Era of Pervasive Computing

Seed investors are in the unique position to spot trends early. Over the last twelve months I’ve noticed a new crop of startups coming in the door at Lerer Ventures and am confident we’re in the early days of the next major shift in computing -  the Era of Connected Devices.   It might still be five or ten years from now - but when it hits the impact will be huge.

These connected devices will be everywhere and enriching our lives in more ways then we can comprehend, today.  No, I’m not taking about a toaster that’s connected to the net.  I’m not even talking about like the Xbox in your living room or the iPhone on your desk. I’m talking about sensors and devices that will monitor and sense our environments, collect data and provide timely and critical feedback. If you think mobile is big right now, wait until the “edge of mobile” is fully developed.  A tremendous amount of value will be created at the “edge” (e.g. sensors, appcessories, etc.) because unfathomable amounts of data will originate here and will then be routed to other devices, applications, services, etc.  In order to support truly pervasive computing, the tech stack - hardware, software, services, infrastructure - will likely undergo significant changes and new value will be created at each level. I believe the companies that own the hardware, software and service in a given market will create significant barriers. 

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