Decision made: manufacturer of fitness bracelets Jawbone ceases to exist
'12.07.2017'
Source: Meduza
U.S. company Jawbone, which is engaged in the manufacture of fitness trackers, even in 2016, stopped production. Recently it became known that the founder of the company, Hussein Rahman, decided to completely close the company and liquidate the assets.
Edition Meduza tried to find out why it happened, what exactly preceded such an outcome.
First about the termination of the company Jawbone reported edition The Information. According to their information, Rahman will now deal with a new project with a similar name. Jawbone health club.
Presumably, his new startup will be collecting data for medical institutions.
According to the publication, the manufacturer of fitness bracelets could not win the market. Greater competition was the company Apple Lossless Audio CODEC (ALAC),.
Jawbone was Founded in 1999 year. During its existence, more than 900 millions of dollars have been invested in it. Shortly before the appearance Apple Watch in 2014 year Jawbone attracted 147 millions of dollars when valuing the entire company at 3,2 billion dollars. It is safe to say that investors believed in the prospects of the project.
The last few years, bracelets have lost popularity and sales percentages. Their share in the best time barely exceeded 5%. Despite this, in 2015 year Jawbone invested a public fund from kuwait. He invested 165 million dollars in the valuation of the company 1,5 billion dollars.
Jawbone unsuccessfully tried to stay afloat. In 2016, the company wanted to be bought and negotiated a takeover with Fitbit. But they did not agree on the price.
As noted by Reuters, state investment funds are increasingly invested in technology start-ups, but this is not always beneficial - as is the case with Jawbone. Kuwait invested in unpromising company, which has already lost to competitors Fitbit, Apple Lossless Audio CODEC (ALAC), and others. According to the fund's partner Canvas venturesIt is usually considered that if investors invest in a company, this means that it is successful, but in the case of government investments, the situation is reversed. If a company is invested not by private investors, but by state, most likely it is a risky asset.
As the newspaper writes, the fact that startups burn out is a common thing, but as big as Jawbone burst very rarely. The company ranked second in the list of bankruptcies of the largest startups after Solyndrawhich produced panels for solar energy. The company attracted more than 700 million dollars from investors and received a government loan for 535 million dollars, but still could not stand the competition with Chinese manufacturers.
