View is one of the most well-known brands in the area of dynamic glass and smart windows, which are becoming an increasingly common element in smart buildings. As a start-up, View rose to unicorn status in 2018 with support from a range of top investment funds and it was one of the first smart building companies to take the SPAC route to IPO. In this research note, we explore the M&A, partnerships, and investment in View Inc. to map the firm’s smart buildings strategy.
Originally founded under the brand “Soladigm” in Santa Rosa, California, the firm was renamed “View” in 2012. Company growth has been driven by the potential of its smart window technology, which uses artificial intelligence to adjust automatically in response to the sun, eliminating the need for blinds during peak sunshine hours and increasing access to natural light when needed. View technology is now installed in more than 90 million square feet of buildings spanning offices, hospitals, airports, educational facilities, hotels, and multi-family residential buildings.
View was one of the most heavily funded firms in the smart buildings space and acquired unicorn status in November 2018 when it raised a $1.1 billion Series H funding round led by the SoftBank Vision Fund. Other backers include a who’s who of leading US investment funds, such as California-based Khosla Ventures, Sigma Partners, Navitas Capital, and US Northeast-based Blackrock and GE Capital.
“We believe that View has created an entire new market category that makes buildings healthier and smarter,” said Tom Cheung, Partner at SoftBank Investment Advisers. “They are reinventing the way we create building spaces by putting the well-being of occupants first. We are very impressed with the care with which Rao and the team have built View and we are excited to partner with them.”
In November 2020, the firm announced its intention to become a publicly listed company using a reverse merger with a special purpose acquisition company (SPAC), Newmark and Cantor Fitzgerald’s CF Finance Acquisition Corp. II. The board of directors at View unanimously approved the transaction that granted up to $800 million of gross proceeds and a $300 million private investment in public equity at $10.00 per share. Goldman Sachs acted as the exclusive financial advisor to View for the deal.
"View is well-positioned to use technology to drive change across the real estate industry. View has created groundbreaking products, covered by over 1,000 patents and built state-of-the-art manufacturing operations in the US,” said View Chairman and CEO, Dr. Rao Mulpuri. “As we become a public company and continue on our growth strategy, we are very excited to partner with Howard Lutnick and the team at Newmark, which will enable us to leverage their deep commercial real estate expertise."
Despite the high hopes of View’s executives and its leading investors, the company has struggled since going public. After an underwhelming launch, View’s stock prices decreased 3% on its IPO debut to $8.92 a share by March 2021. The firm then failed to file quarterly 10-Q financial forms for the first and second quarters of 2021, prompting NASDAQ to respond with official warning letters, making it one of only four non-compliant firms on the exchange. View was given 180 days from mid-August to enact NASDAQ’s compliance plan and submit revised reports, and the firm remains on the exchange.
“Having been granted a stay of delisting by the SEC, View, Inc. completed its financial restatement of 2019 and 2020 results and released full-year 2021 results on 31st May 2022,” we wrote in a June article. “Total revenue of $74 million represents a 125% year-over-year growth from 2020 driven by increased customer demand, and the introduction of the View Smart Building Platform and View Smart Building Technologies. However, they posted a net loss of almost $343 million, a 33.5% increase in losses from 2020.”
By January 2022, View’s stock price had still not risen above $10 a share for retail investors. In an investor suit filed against the company, investors argued that the deal was “disastrous” for public investors, pointing to the benefits given to Cantor Fitzgerald insiders while retail investors saw their shares drop to below $2.50 per share. The suit argued that the Cantor Fitzgerald board, characterized as “independent” in the approval process, was actually strongly incentivized to approve deals because they were “compensated with founder shares that would profit even in the event of value destruction”.
View has made some significant business moves in recent years. Here we map View’s acquisition, partnership, and investment landscape to identify patterns that are shaping the company's future direction.
View has made two major acquisitions post-IPO. In July 2021, amid the non-compliance issues with NASDAQ, View acquired IoTium, a prominent provider of secure, cloud-managed, software-defined IoT networks. IoTium’s solutions enable buildings to quickly achieve enterprise-grade security, reduce operating costs, and gain real-time visibility on entire real estate portfolios. The combination supports the deployment and analytical capabilities of View’s growing portfolio of connected sensors and devices, including their range of smart windows.
In December 2021, around the time of NASDAQ’s warning letters, the company acquired RXR Realty’s WorxWell Platform —a data analytics platform that aggregates all building data including occupancy, space usage, digital collaboration and work patterns, access control, air quality, temperature, and environmental factors into a consolidated dashboard. The combination enables View to provide an integrated, end-to-end, product stack for software, sensors, and data.
View has also partnered with a range of companies on interoperability, integration, and product development. In the data analytics space, View partnered with Mapped, a fully automated independent data layer platform that fast-tracks the data integration and onboarding process down to a few hours, eliminating the need for manual integrations with vendor applications.
The firm also partnered with Butlr Technologies, an anonymous people-counting platform that includes occupancy sensors addressing use cases served by View’s building performance and workplace experience applications. These two partners, alongside View’s two acquisitions, make clear the firm’s commitment to further developing it’s data analytics capabilities and product offerings.
In the energy management space, View partnered with Nantum by Prescriptive Data, whose operating system enables building owners to manage energy consumption and carbon emissions. Another deal with a data-driven company but this time, with a sharp focus on energy and environmental aspects of the building.
As a smart windows company, ventilation and air quality are obvious directions for View, and their partnership with Awair fills that strategy. Awair provides an air quality monitoring platform with RESET-accredited air quality sensors and long-range mesh network technology that helps enterprises cost-effectively measure indoor air quality.
And, in January 2022, View announced a partnership with residential design company Nabr, co-founded by architect Bjarke Ingels. According to the announcement, all Nabr Homes will be constructed with View smart windows, as well as sustainable materials and be carbon neutral in operations. Additionally, View’s cloud-connected smart building network, View Net, will power all connected products in Nabr developments, such as smart locks, access controls, air quality sensors, smart thermostats, parking, and other resident and community applications.
The future of View Inc. is far from certain. Whilst they have done well to build out their software offerings through some good acquisitions and partnerships post-IPO, their financial position is perilous. Raising $200m in debt from an investor group led by RXR just a month ago will have secured their short-term future, but they are still burning through cash. The quarter to September 2022 net income was a loss of $82.07m. Whilst revenue in that quarter did increase over 25% YoY to $23.76m, as recently as May, the company openly talked about a threat to their survival.
Retail investors seem to have lost confidence, with (at the time of writing) the share price at $1.20, down from a high of $12.49 in January 2021, less than 2 years ago. Will the investor group continue to prop up the company in the hopes of a turnaround? Or, will the company be acquired? With their current valuation at around $250m, in our opinion, that would seem quite likely unless potential acquirers adopt a wait-and-see strategy.