A relatively similar story to Pebble too, no? Interesting to see two well-known 'successful' startups implode like this in the same space.
It seems a recurring theme in SV that companies neglect to consider the overall market size for their niche product when deciding how large to try and scale their business.
Jawbone was in a larger market with more competition and much less customer stickiness. I believe that they were in more of a "go big or go home" scenario.
I mean I don't even feel the Apple Watch will still be around in the next few years.
The frustrating thing is that Pebble could have had a nice $20M p.a. business selling their smartwatches. Not big enough for Apple & Google, but definitely enough to make a good profit for a small company.
That 2015-2016 smartwatch hype may well have killed the market for everybody. It reminds me of the VR hype in the early nineties that killed the market for ~20 years.
And I do like getting notifications on my Garmin watch as well as using the GPS for some activities. But, in a world where so many people also carry their smartphone with them almost everywhere, people aren't going to fiddle too much with the small device on their wrist when they can pull a phone out of their pocket.
Definitely. The jump from dumbphone to smartphone was pretty huge. I can do a lot more on the go now than I could before. The jump from smartphone to smartphone + smartwatch is smaller, and possibly just lateral rather than forward. It doesn't enable many more things than just a smartphone, but it offers you a slightly more convenient way of doing some things, at the cost of another device to charge and keep track of.
"The second most important thing to understand is that raising too much money or raising money at too high a valuation can severely limit your optionality. Very often I’ve seen cases where founders know in their hearts they have an airplane but are able to convince good investors it might still be a spaceship. This really causes a lot of heartache, and often precludes your opportunity for a good acquisition later."
That's not to say that everything is doom and gloom. But it's a tough market for companies to play in and they probably need to be reasonably diversified for when one area falls out of mainstream favor.
Would you rather have bought stock in Tesla, Nissan or Toyota ten years ago?
Leafs and Priuses are only part of Nissan and Toyota, their stock obviously cannot fully reflect the success of those vehicles. And Tesla's stock is notoriously overvalued.
Similarly, I'd rather have a McLaren than Tesla (or Toyota), but that doesn't speak anything about the talents of either firm at mass producing cars.
> Tesla certainly did a lot better than other attempts at electric cars
You have decided that that claim hinges on their ability to mass produce cars.
I think Tesla has done more for the electric car market than any of the other companies. I can't justify that with data, but I think it's a reasonable position. We have different points. I'm not missing yours.
What's really tough is turning a Bluetooth speaker business or a smart-watch business into a multi-billion dollar business. It's the over-investment and sunk-cost problem that ruined Jawbone, not the hardware nature.