Pebble, a global Smart Watch veteran manufacturer, has been leading Apple Watch for more than two years, but recently ended its entrepreneurial journey with a salesperson. Steven Levy, a famous American technology journalist, wrote about smart watch maker Pebble. The last time before the acquisition by Fitbit. When Pebble CEO accepted Levi’s interview, he also summarized the mistakes they made.
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If the myth of Silicon Valley is true, Eric Migicovsky should be happy at this time. After all, he failed.
For the past nine years, he has devoted all his energy to Pebble – at the age of 21, when Mickeykowski, who was studying in Delft, the Netherlands, founded the company, even though the city’s most famous is Pottery, not technology.
His experience has become a legend: it was a difficult time to incubate inside Y Combinator, but it was popular overnight through the crowdfunding platform Kickstarter. They developed their own brand and sold more than 2 million smart watches. It sounds like a great achievement, but it's not the whole story: Pebble is in a loss and still can't see the promise of profit in the short term.
As a result, Mickeyksky sold Pebble's key assets to Fitbit on December 6, including the company's intellectual property. According to reports, Fitbit will hire 40% of Pebble employees. Today, 30-year-old Mitchkowski will face the first days of losing his CEO title in his adulthood.
In such a culture of fascination, he finally got the ultimate diploma: a completely failed entrepreneurial experience.
But he is not happy.
He is not so depressed. When I saw this tall, thin, bearded Canadian in a restaurant in Palo Alto last week, he still maintained the happiness and wisdom of a bright future, but the dialogue between us was still More serious. After all, Fitbit completed the acquisition of Pebble on that day.
Mickey Kawsky is willing to see me because I will report his company from time to time. I interviewed him long before he was just a hardware startup incubating with Y Combinator. It was at Y Combinator's 2011 winter camp, his company was also called Alerta, and their smart watch was called InPulse.
In addition, Backchannel has interviewed him many times over the past two years, and we have called the series of articles "Pebble Adventure." I interviewed Apple after Apple released the Apple Watch in September 2014. Mitchowski said at the time that the emergence of the Apple Watch was an endorsement of wearable devices, so Pebble would benefit from it.
I have seen an earlier version of the Pebble TIme Round, which looks cool and looks a bit like Swatch. Earlier this year, I was fortunate enough to see Pebble expand its product line to screenless devices - it can be hung on the key ring and stream music to add fun to your running process. (It also runs Amazon Alexa software and supports thousands of voice commands.)
When we arranged the meeting, the news that Pebble would sell to Fitbit was already exposed, and he proposed something that I had already begun to think about: recording Pebble's last adventure.
"Love adventure" is a good description of Pebble's history this year: 2016 began in the crisis. The previous year, the once profitable company suffered a loss, and did not even complete the sales target in the second half of 2015.
Pebble has never returned to profitability since then. In March 2016, Mitchkowski cut a team of 160 employees by a quarter, when Pebble had just moved from the rudimentary headquarters of Palo Alto to the spacious and bright new office of the Redwood City Center. At that time, they were optimistic that they rented two floors, but now the staff can only sit on one floor.
The results showed that both Pebble and Apple misjudged the wearable market. "The iPhone on the wrist" has not been recognized. So far, the only killer app on the wrist seems to be fitness.
Active users of wearable devices find it useful to carry a device that tracks their vital signs and running metrics. Apple values ​​fashion, Pebble values ​​efficiency, and spares no effort to lead third-party innovation. But these efforts have not worked, only health and fitness can give real life to the smart watch market.
"We wake up late, and Apple has found this problem," Mitchowski said. (He admits that notifications may be another key feature of smart watches.) "We didn't develop this market in 2014 - if we were targeting wearable fitness smart watches at the time, the situation might be different. â€
It is worthy of recognition that Pebble has been trying to catch up. The company's products released earlier this year did focus on fitness, and the Pebble Core key ring device mentioned above is about the size of a mahjong tile. (You may have discovered that the second generation Apple Watch is also aimed at the fitness crowd.)
Pebble also introduced a new watch optimized for fitness applications with heartbeat monitoring. In April of this year, the Kickstarter crowdfunding project attracted more than $12 million in orders.
But everything is too late, and these sales are not enough to save Pebble. Pebble Core is destined to become a ghost product - although its prototype is attractive, it will never be shipped to 22,400 Kickstarter supporters. (They will receive a refund via the Kickstarter system.)
In an interview in April this year, Mitchowski did not tell me when he talked about Core. The reason why they returned to Kickstarter was because the company could not continue financing. “It’s hard to raise money during layoffs, and we’re no one interested.†He said to me now, “Because of this, we use Kicksatarter. After Kickstarter, we tried financing, but it didn’t succeed.â€
Throughout spring and summer, Mickeykowski tried various methods to save his company. But as the summer is over, the Christmas shopping season is coming – new products have been postponed, and their original plans were released no later than 2017 – and he is starting to whip.
“September is very busy,†he said. “I’m flying around the world. I’ve been to China, trying to sign an operating system license agreement, and I’ve met some investors – they’re seeing investors at the beginning of the business. At different levels.†Instead of visiting top venture capital firms, he found private equity firms and family trusts – all outside the traditional technology circle.
He has thought about a lot of programs and even considered equity crowdfunding. But since the company has been criticized for its frequent use of Kickstater for product crowdfunding, this plan can only be done. Many other programs have also been rejected, including some extreme ideas: “For example, to squander everyone, reduce the size of the company to 10 people and see what happens.â€
He now compares the situation to the night of the presidential election night: watching Trump's votes more and more, and what can Hillary Clinton win? Like Hillary, Mitchowski is also back to heaven.
In October of this year, Mickeykowski finally decided that Pebble was irreparable. It's time to sell the company, but his first thought is to protect customers, maintain relationships with developers, and spare no effort to fight for the benefits of employees. Unexpectedly, this has given him and other executives new impetus.
"When we made a decision in October, things became simple." Mickeykowski said, "We only have one task, that is, sell the company."
The most suitable buyer is clearly Fitbit, the leader in the wearable fitness market and has recently entered the smartwatch market.
Mitchowowski said that in addition to a good cash reserve (Fightbit's cash balance is close to $40 million, according to Bloomberg Businessweek estimates), Fitbit is attracted to the company's willingness to retain Pebble developers and users.
Although it is still unclear how it will develop in the future – for example, can future Fitbit smart watches run the Pebble operating system? - But Mickeykowski said in a blog that Fitbit's deal can expand the developer's reach from 2 million Pebble users to 50 million Fitbit users. “Fitbit strongly supports developers,†he said.
Although the details of the deal were not fully disclosed (Mitchkowski could not disclose this information at will), but from Pebble and Fitbit’s respective statements on the blog, this is an asset acquisition transaction involving Pebble’s software, Firmware, patents, but does not include actual hardware and inventory. Pebble is still responsible for solving his debts.
Pebble's smartwatch can still be used, and Fitbit will initially support Pebble smart watches, but the warranty policy is no longer available. Companies that develop third-party applications and plug-ins for them can continue to do business, but the number of users will continue to shrink. Users who order Pebble products through Kickstarter will receive a refund.
Fitbit has also recently encountered its own troubles - the company lowered its sales forecast during the Christmas shopping season last month, and its share price hit a record low – but after absorbing Pebble's engineers and patents, Fitbit's future products are expected to improve.
Ironically, Mitchowski said in an interview in April last year that FiTIbt realized early that fitness would be an important function of early wearable devices and developed products based on it.
“They generally understand how to transform from a healthy product to a more popular smart watch.†He said to me at the time, “Our current situation is just the opposite. We started out as a universal smart watch, but now we must realize that health is the most popular use of Pebble. The main purpose." Of course, he apparently did not know that Fitbit would complete the transformation by acquiring his company.
Fitbit CEO and co-founder James Park expressed a similar point in the press release: "As the basic wearable devices become more intelligent, as smart watches gradually increase health and fitness, we see Develop opportunities in your strengths and hope to expand our leading position in the wearable arena."
Mickey Kavsky will not join Fitbit. He is not convinced whether he will play for Y Combinator. No matter what job he does, he will not leave Pebble with a lot of wealth. “This is not the kind of deal,†he said. “The deal is primarily about the interests of customers, employees and vendors.â€
Does he have any regrets?"I won't change much," he said. "My plan is not perfect, but very few things are perfect. We tried it, developed a good product, and sold it. We opened up. A market...but we have not been able to go further."
What does he think of the "failure badge" in Silicon Valley? Mickeykowski does not think he has obtained such a badge. "I don't necessarily fit the pattern of fast failure," he said of his nine-year journey. But for Mitchowski, the important motivation for selling a company is to retain opportunities to continue to nurture the communities he has built.
“This is not a large-scale community, but I think it has a certain scale: there are about 2 million people around the world,†he recalls.
In my opinion, Eric Mitchowski has made great achievements before the age of 30. Although his company suddenly died, Pebble was very creative and inclusive, delivering value to users and creating a community for developers. Pebble is refreshing in the era when big companies are vying for you, sometimes even astray.
Mickeykowski is only 30 years old this year. He still has a lot of time to create brilliance for himself. There are also a lot of "watches" to help him seize the opportunity.
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