The Internet of Things (IoT) connects everyday devices, sensors, and machines to networks that exchange data in real time. This technology fuels growth in smart homes, industrial automation, healthcare monitoring, logistics, and connected vehicles. With billions of devices coming online in the next few years, many investors want exposure to this fast-growing field.
In this article, we’ll go over the many ways to invest in IoT and how each path fits different risk profiles, time horizons, and goals. By the end of this, you can match your strategy with the right investment platforms and timelines.
Direct Equity in IoT Companies
Buying shares of companies that focus on IoT is one of the most straightforward approaches as these firms build the hardware and software that power connected devices.
A few key examples stand out. Samsara provides IoT platforms for logistics, fleet management, and industrial monitoring. Its software and hardware combine to optimize transportation and supply chains. Qualcomm and NXP Semiconductors supply IoT chips and wireless communication components that enable billions of devices to connect seamlessly. Sierra Wireless, now integrated into Semtech, historically played a leading role in IoT connectivity solutions.
To buy shares of these companies, you can use mainstream brokerage platforms. E*TRADE, Charles Schwab, and Fidelity provide commission-free stock trading with research tools suitable for long-term investing in U.S. equities. For those outside the United States or who prefer access to global stock markets, Interactive Brokers provides advanced tools and worldwide coverage.
Direct equity is most effective when backing specific IoT leaders or investing in the growth trajectory of particular firms. The tradeoff is higher volatility since company-specific events can quickly move share prices.
IoT ETFs and Funds for Diversified Exposure
Not everyone wants to pick individual stocks. Exchange-traded funds (ETFs) offer exposure to a broad set of companies across the IoT ecosystem. By holding a basket of firms, you reduce the impact of one company underperforming while still gaining from overall sector growth. This path suits investors who want exposure to IoT trends but prefer the stability of diversification.
The Global X Internet of Things ETF (SNSR) is the most direct IoT-focused ETF. It holds companies across semiconductors, sensors, networking, and IoT platforms. The ARK Autonomous Technology and Robotics ETF (ARKQ) focuses on companies leading innovation in automation, autonomous vehicles, and robotics, with significant IoT overlap.
Investors can purchase these ETFs on many of the same platforms used for individual stocks. Vanguard, Fidelity, and Charles Schwab are strong options, known for their wide ETF selections and competitive costs. eToro gives international investors access to these ETFs while also offering copy-trading features that allow replication of other investors’ strategies.
Indirect and Strategic IoT Beneficiaries
Many large companies benefit from IoT adoption even though it is not their sole focus. These firms already dominate in areas like cloud computing, telecommunications, and cybersecurity. As IoT expands, its existing services become more valuable, creating a growth engine within diversified businesses.
Amazon leads the smart home market through Alexa, Ring, and home automation protocols, while also operating AWS IoT services in the cloud. Microsoft provides enterprise IoT connectivity through its Azure IoT Suite. Cisco Systems supplies networking hardware and infrastructure to connect millions of devices worldwide—cybersecurity players such as Palo Alto Networks secure IoT ecosystems against new threats.
These companies trade on major U.S. and global exchanges, so platforms like E*TRADE, Fidelity, Schwab, and Robinhood provide straightforward access for U.S. investors. International exposure can be managed with platforms such as Interactive Brokers, Degiro, and Revolut, which allow access to European and global equities.
Indirect IoT investing suits investors seeking stable growth. These companies generate revenue from many business lines, which cushions risk if IoT adoption faces slowdowns. They are often considered blue-chip investments that combine IoT potential with diversified income streams.
Private IoT Startups and Early-Stage Opportunities
For those seeking higher risk and potentially higher reward, private IoT startups provide an opportunity to invest before these companies go public. The IoT startup landscape is diverse, with innovations in smart healthcare devices, connected vehicles, industrial monitoring, and home automation.
Traditional access to early-stage deals was limited to venture capital firms and accredited investors. Today, equity crowdfunding platforms make it easier to participate. SeedInvest features startups across industries, including IoT, while Republic provides opportunities accessible to retail investors with lower minimums.
Another investment platform, Acquire.Fi, offers curated global deals for registered institutional buyers. Their M&A Marketplace enables investors to secure whole IoT startups, while their Web3 Secondaries Marketplace makes it possible to buy equity of established IoT companies through over-the-counter deals.
Private investments come with higher uncertainty as startups can scale quickly but also face intense competition and high failure rates. Investors willing to accept this risk gain access to pre-IPO opportunities that can deliver outsized returns if the company succeeds.
Timeline Perspective for IoT Investments
Each IoT category aligns differently with short, medium, and long-term horizons. Some paths offer fast movements but higher volatility, while others provide steady growth that compounds over time.
| Category | 1-Year View | 3-Year View | 5+ Year View |
| Direct Equity | High volatility, quick gains or losses possible | Growth tied to IoT adoption cycles | Potential for significant returns if the company becomes the sector leader |
| IoT ETFs | Steady performance reflecting sector trends | Balanced growth across adoption cycles | Structural rise in IoT adoption captured with less risk |
| Indirect Plays | Limited IoT-specific movement, broad business drivers | IoT integration starts to show a more substantial revenue impact | Compounding growth as IoT becomes core infrastructure |
| Private Startups | Minimal liquidity, high uncertainty | Significant growth is possible if milestones are hit | High-risk, high-reward outcomes at IPO or acquisition |
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