Wearable technology is projected as the next big thing in the consumer hardware segment. Wearable gadgets range from wrist bands that measure a person’s activity and health statistics to wearable cameras and glasses that track the user’s actions. Analysts believe that it is still too early to accurately forecast the market size of wearable cameras, but some still guess that wearable cameras would account for a $10 billion market in the US alone by the year 2016.
Recently, San Mateo-based wearable camera hardware and software developer GoPro filed their S-1 for an IPO expected later this year. GoPro was founded in 2003 by Nick Woodman and has become the world’s leading activity image capture company. They are best known for their line-up called HD HERO that includes wearable and gear-mountable cameras and accessories. GoPro’s widely successful Hero cameras were launched in 2007 and they helped propel the growth of the action camera segment.
GoPro believes that they have the capability of being more than a hardware company as they are able to transform the way consumers not only capture images, but also manage, share, and enjoy them. GoPro’s camera users are able to take immersive videos and photographs of extreme sports and create personal content that can be shared across social media through easy-to-use apps.
Their cameras include advanced software features such as remote control solutions and the ability to seamlessly integrate with mobile devices to enable self-capture during the activity. They released their HD camera back in 2009 and since then have sold more than 8.5 million HD units. Images and media captured on GoPro cameras are conveniently managed through their software solutions such as the GoPro Studio that enables their customers to edit videos, even create videos from time-lapse photo sequences, and wirelessly copy footage from a GoPro camera to a mobile device for storage and sharing.
GoPro’s innovative devices have helped deliver strong revenue growth. GoPro’s S-1 reveals that in 2013, their Hero cameras had a 45% share of the US camcorder market compared with 11% market share in 2011. Annual revenues in 2013 have grown from $234.2 million in 2011 to $985.7 million. During the first quarter of the current year, GoPro saw revenues of $235.7 million. The company has been profitable as well during this period. Net income has improved from $24.6 million in 2011 to $60.6 million in 2013. During the previous quarter, they earned a net income of $11.0 million.
Till date, GoPro has been venture funded with $288 million in investments from Foxconn International, US Venture Partners, Sageview Capital, Walden International, Riverwood Capital, and Steamboat Ventures. Their last round of funding was held in 2012, when they raised $200 million from Foxconn at a valuation of $2.25 billion. Last month, GoPro filed their S-1 announcing their intention to go public to raise $100 million.
GoPro’s Growth Plans
GoPro plans to become known as a media company instead of an action camera one. They believe that there is immense opportunity in being able to develop software solutions to further streamline the integration of GoPro content management platform with other media. Recently, they hired former Skype CEO Tony Bates to their leadership. GoPro is looking for ways to monetize the videos that users upload from their cameras and Bates is expected to help with these ambitions. Last year, GoPro’s customers uploaded approximately 2.8 years worth of video featuring with GoPro in their title to YouTube. During the first quarter this year, there were over 6,000 such uploads daily and more than 1.0 billion views on the channel. GoPro plans to use advertising to help with monetization.