OSIsoft’s Next Chapter

OSIsoft’s Next Chapter

This morning, Softbank announced that it has made an investment in OSIsoft, the leader in time series data collection and aggregation for the industrial world. This announcement is bittersweet, as Softbank will purchase our shares as a part of the transaction. While we are thrilled for OSIsoft and the upcoming growth opportunities, it is tough to part ways.

When we first met OSIsoft in 2008, we knew that the company was special. Since then, the company has become the gold standard in time series data collection infrastructure and cemented its market position in data management. Deployed on 19,000 sites across the world, it has attracted a 65% of the Industrial Fortune 500s as customers, including major players in industries like energy, chemicals, manufacturing, pulp and paper, pharmaceuticals, transportation and more. Currently, OSIsoft customers stream more than 1.5 billion data points through their systems, doing work to improve profitability in the industrial economy and to increase asset reliability and efficiency. These customers love the product and the company itself, due to OSIsoft’s dedicated and passionate team and its commitment to customer success.

We are grateful to have worked with OSIsoft over the past six years as the company has played an indispensable role in digitizing its customers’ operations. As we look out into the future, OSIsoft is extremely well positioned in the Industrial Internet of Things. We believe that its PI infrastructure is a critical part of an industrial technology architecture that seeks to unlock value from time series sensor data. This is because the PI system is able to collect, organize, secure, and contextualize vast amounts of operational data that would otherwise be left scattered among different incompatible systems, formats and processes. With OSIsoft’s software, this data is consolidated into one high-fidelity framework that ensures all monitoring and analytics applications work seamlessly, resulting in a multitude of benefits including optimized asset utilization, reduced operational costs, and improved worker productivity.

Our investment in OSIsoft has given us perspective on opportunities across the world to digitize industry. Our work with the company and its customers led us to incubate Element Analytics, which applies advanced analytics to time series sensor data. It also informed data-driven investments in Green Growth Fund portfolio companies Farmers Edge, Cenergistic and ServiceMax. Moreover, this work has helped our team form a thesis around investing in exceptional companies applying emerging technology to traditional industries in novel, sustainable ways.

This thesis was formulated around a $100 trillion dollar trend: the digitization of industry. As this trend unfolds, and industries worldwide transition from traditionally analog processes to digital ones, we are seeing tremendous new opportunities for value creation, economic growth, and sector disruption. Most importantly, these opportunities will unlock previously unidentified paths to sustainability and resource efficiency. OSIsoft embodies the core tenets of this thesis, so we’ll continue to look to the company as a source of inspiration as we move forward.

We are excited to stay involved in the OSIsoft ecosystem as partners with Element Analytics and hope to work with more partners of OSIsoft in the years to come. Information infrastructure for the industrial world is now more important than ever, so we offer our congratulations to the OSIsoft team and look forward to the company’s next phase of growth as sensor data continues to proliferate and the sector rockets toward a future of 50 billion connected endpoints. Once this level of ubiquitous connectivity is reached, OSIsoft and similar, innovation-driven companies will blaze a path into a new era – one that we like to call the “Industrial Awakening” – where machines will communicate with one another, predict their own malfunctions, and emit more actionable information than ever before.

David Mount is a partner in Kleiner Perkins’ Green Growth Fund (GGF), which supports young companies leading new markets in sustainable ways. David is focused on software and services investments applicable to the energy and industrials markets. He is on the boards of UpWind Solutions and Choose Energy, a board observer at OSIsoft, and led the firm’s investment in ServiceMax. He has also worked closely with the teams at Silver Spring Networks (SSNI), Opower (OPWR), and Hara (acquired by Verisae).