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Microsoft is on the hunt for home automation startups

Home automation is likely the next big wave for consumer innovation. While the idea is nothing new, the barrier to entry for startups is quite low and prices are quickly entering the range where many consumers can afford such luxuries.

An easy example of the home automation wave is Nest, a simple thermostat that uses algorithms to help keep your heating and cooling costs down, but packaged as a stylish piece of hardware. Admittedly, what they were doing was not new, but their execution was unique and their marketing was more or less perfect.

Nest was soon bought by Google, fueling the home-automation race among the tech giants with Apple getting into the game too, and now Microsoft is looking to move in on the turf. 

Microsoft’s approach, however, is a bit different from that of Apple or Google, as the company is opening up an accelerator program. In partnership with American Family Insurance, Microsoft will be opening up an immersive program from August to December and American Family Insurance is offering an optional $25,000+ for an equity stake in any company accepted into the program. 

The program is quite interesting from Microsoft’s perspective, as it is focused on one specific type of company and the intent may be more far-reaching than it seems at first glance.

With the home automation market starting to heat up, it seems that Microsoft wants to get in on the ground early with new companies in this arena. The thinking behind this move could be to spot new technologies before they hit mass market so that Microsoft can acquire companies in this space and give themselves an advantage against competitors.

This type of strategy is a big bet as finding these companies at an early stage is not an easy task, requiring the right combination of ideas, execution and coding to make a company a success. But Microsoft is not alone as the field of venture capitalists looking for the ‘next big thing’ is about as crowded as a sardine can.

Will it pay off for Microsoft and the startups? That’s a question that only time can answer.

Source: Microsoft | image via Satya Nadella

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