Fitbit Is Buying Smartwatch Maker Pebble For Around $40 Million, Says Report (techcrunch.com)

According to a report from The Information, Fitbit is buying smartwatch maker Pebble for a "small amount" of money. One source says Fitbit is paying between $34 and $40 million for the company and is "barely covering their debts." TechCrunch reports: A source close to the company told TechCrunch that watch maker Citizen was interested in purchasing Pebble for $740 million in 2015. This deal failed and before the launch of the Pebble 2 Intel made an offer for $70 million. The CEO, Eric Migicovsky refused both offers. Pebble released the newest version of its smartwatch in October, but the past year or so has been a challenging period. It laid off 25 percent of its staff in March, while we reported last year that it was in some trouble and had turned to debt funding and loans, as well as traditional investor cash, "in order to stay afloat." Earlier this year, Pebble CEO Migicovsky confirmed that his company had raised $28 million in debt and venture financing. He blamed a more cautious outlook from VCs focused on tech as the primary reason for letting 40 of Pebble's staff go.

Comments

That quote says it all

[goose-incarnated]

He blamed a more cautious outlook from VCs focused on tech as the primary reason for letting 40 of Pebble's staff go.

In what universe is this quote acceptable?

This man appears to believe that businesses get money from VCs and pays money to employees+suppliers. Last I checked, businesses got money from customers. They'd get /loans/ from banks (but that has to be paid back).

The problem with a lot of SV/Tech startups is that the people involved appear to believe that their income comes from VCs. Their business plan is effectively "Get VC Money, Then Sell Company!"

A depressed market would soon separate the wheat from the chaff.

Re:Realistic

[TodPunk]

Or the technology isn't there yet.

Remember the 'fad' of the Palm Pilot and Apple Newton? The technology wasn't there yet and now smartphones.

I disagree with this sentiment strongly. Palm Pilots were fantastic. The lack of popularity wasn't anything to do with tech. The tech was there, it just wasn't sexy. You need to make it stupid and give it a selfie app before it's popular, but that has nothing to do with the tech being there. It's not even a matter of viability. Niche markets exist, and Palms were largely marketed to business users anyway, who loved them.

The only reason smartphones are popular is because they have been made sexy to a mass market who uses them largely to waste time. There's nothing wrong with that choice, but we should acknowledge that demographic as the primary. Palm users were running businesses and managing teams off of them. Your average smartphone user is using instagram or the ilk.