Digi-industrials: rising stars and investment considerations

14 January 2020

An abundance of information continues to transform industrial processes as owner/operators seek to optimize assets and make more informed decisions through investments in digital technology. For diversified industrial companies and investors, capturing a greater ownership of this information through adding complementary digital solutions to their product portfolios is increasingly the key to competitive advantage and value creation.



Emerging segments:


There are several emerging segments where the digi-mechanical transformation is on the rise, both in challenged and high growth markets. These include:

  • Machine condition monitoring (MCM): MCM is a fast-developing digital segment across industrial markets as end-users seek to achieve 100% equipment uptime through real-time predictive maintenance
  • Smart fleet: Marine, rail, construction machinery have been slow to adopt digital but are now fast-emerging segments driven by the need for information to better connect and optimize fleets and vessels
  • Smart utilities: Digital investment in conventional power gen is driven by owner/operators’ need to optimize existing assets in the face of structural shifts towards renewables. Water and gas utility investment is driven by the need to better manage aging infrastructure
  • Food inspection and analysis: Digi-mechanical adoption in food processing is on the rise, driven by changing standards and evolving consumer preference
  • Agritech: Agritech and information offers huge potential but also adoption challenges such as farmer budgets and user complexity which has limited the number of solutions that have achieved scale


Key investment considerations:


There are a number of fast-growing digital technologies and information products which have achieved scale. But knowing which investment opportunities are most attractive involves consideration of several key issues, including:


  • The size of the addressable opportunity
  • The criticality of need
  • The rate of adoption
  • The ability of the technology to produce rich and accurate data


Understanding the market’s readiness to adopt and the technology’s ability to disrupt through rich, accurate and real-time information are key investment considerations. For example, in machine condition monitoring the holy grail is in-line technology which can produce accurate data on the health of machine assets, in real time. However, to achieve accurate results the technology requires access to masses of historical data across a wide range of machinery. Without the historical data, the technology has limited value-add. The true disrupters are the companies which can bring both the information and the technology together.


It is still early days for digi-industrial growth with numerous game-changing technologies in the early stages of development. Diversified industrial corporations and investors can add significant value to their product portfolios through complementary digital solutions but need to be sure the market is ready and the technology is a winner.


Want to know more about how we help clients in the industrial technology and information sector?

Plural’s industrial tech team works closely with a number of global multi-platform industrial technology companies and private equity investors focusing on emerging opportunities presented by digitally-enabled and best-in-class mechanical technology in specific end markets.

Browse our insights and case studies within the sector for more details here.

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