In this research note we examine Silvair, a California-based and lighting-focused IoT software solutions provider with Polish origins. The firm has developed an innovative technology for wireless communication of devices on an open-source mesh topology and is currently commercializing its product in the form of software and services with a particular focus on smart lighting systems.
In 2018, Silvair became the first IPO in the history of Poland’s capital markets in which the shares of an issuer from the US were listed solely on the regulated market of the Warsaw Stock Exchange (WSE). Breakthrough solutions developed as part of the Silvair IPO now enable US companies that have benefited from early rounds of financing in Silicon Valley, to base the next stage of their development on financing acquired on the WSE.
Silvair offers its lighting firmware based on the Bluetooth mesh standard, which allows for the development of an IoT Platform. Their firmware can be installed by third-party lighting OEMs in their lighting components, such as drivers, sensors, fixture controllers, and switches, allowing those devices to wirelessly communicate with each other. The platform includes digital tools for commissioning, configuring and managing smart lighting networks, as well as the sensor-based infrastructure to enable the firm to provide a range of IoT services.
Silvair distinguishes its offering into 3 segments: Lighting Control, Smart Lighting Services, and Smart Building Management. However, during the 2021 period the company earned revenues only in the Lighting Control segment, as it works towards realizing revenues in the other segments. Although previous years did include revenues from its Wi-Home and Proxi segments which have since been discontinued.
“When we speak of lighting control, we have two fundamental benefits in mind. Of course, the first one is to conserve energy, while the second one is to give comfort to the people who are in a given venue. Our business is focused primarily on this topic at this time. We are chiefly pursuing commercialization on the lighting control market,” said Rafał Han, CEO of Silvair.
According to its annual report, Silvair’s sales revenues for the year ending 31/12/2021 were $645,000, representing a 58% increase on the previous year ($372,000). Of total sales in 2021, 28% came from firmware licensing, 38% came from activation services, 24% came from maintenance, and the remaining 10% came from development and other services. This shows a notable increase in revenue from the activation segment relative to other segments.
Silvair has no domestic sales activity in the US as of the year ending 2021. Total sales in 2021 were geographically divided between the EU with 37%, and the rest of the world with 63%. In 2021, sales to just seven customers accounted for over 70% of revenue, which represents an improved risk scenario compared to 2020, when over 70% of revenue was realized from sales to only five customers.
“North America is a crucial market for us. Europe is, too. On account of the size of our company, we still have fairly limited resources, including time. That is why we are focused on the markets offering the greatest potential,” said Han. “For this reason, today we are chiefly forging partnerships on the US and European markets. These markets are a bit different, but we always strive to reach clients using our technology through partners.”
Over the last 5 years, Silvair has partnered with a wide range of companies. Including leading component manufacturers such as OSRAM, Zumtobel, Steinel, and LinmoreLED. The firm is also expanding its reach with strategic distribution arrangements with Canada-based Future Electronics, France-based 8’33 Smart Building, and Poland-based Lunav.
In 2022, the firm released a new connected lighting service that allows users to monitor and evaluate how much energy their lighting system uses. This expanded service, available via the Silvair web application, helps reduce energy waste and lower the carbon footprint of the lighting installation.
“We believe in open standards – such as Bluetooth mesh. They have always been a catalyst for progress, creating new markets and driving the widespread adoption of technological innovation. They bring the freedom of choice, transparency, and security that no proprietary technology can provide,” said Silvair CEO, Rafał Han. “This is the reason why we ceased the development of our proprietary lighting control solution several years ago, and focused on building a global, open and interoperable wireless standard for professional lighting applications.”