In a deal reported to be in the low tens of millions, Fitbit buys a Kickstarter favourite.
Fitbit has confirmed its acquisition of Pebble, with the deal including the smartwatch maker’s intellectual property, software and many of its staff. Fitbit will not, however, be bringing over Pebble’s hardware portfolio.
The acquisition of Pebble is a move designed to accelerate Fitbit’s drive into the healthcare industry, with reports suggesting that Pebble’s software will be used to lay the foundations of a new app store for Fitbit wearables.
“With basic wearables getting smarter and smartwatches adding health and fitness capabilities, we see an opportunity to build on our strengths and extend our leadership position in the wearables category,” said James Park, CEO and co-founder of Fitbit.
“With this acquisition, we’re well positioned to accelerate the expansion of our platform and ecosystem to make Fitbit a vital part of daily life for a wider set of consumers, as well as build the tools healthcare providers, insurers and employers need to more meaningfully integrate wearable technology into preventative and chronic care.”
In a deal speculated to be worth between $34 and $40m, Fitbit gains not only key assets from Pebble, but also its sizeable market share – in Q3 2016 IDC figures show that it was the fifth largest vendor behind Apple, Garmin, Samsung and Lenovo.
Bolstering Fitbit’s portfolio, which includes the Surge, Blaze and Alta activity trackers, the acquisition will also aid in keeping Fitbit at the front of the pack in the wearables market. In Q3, IDC led the market with 5.3 million units shipped, representing an 11% increase from the same quarter in 2015 when the company shipped 4.8 million devices. Keeping this momentum will be key for Fitbit moving forward as the wearables market continues to decline.
Pebble will discontinue its range of smartwatches going forward, promising to refund any Kickstarter backers who have not yet received products. Pebble, which has struggled financially, has always looked to Kickstarter for funds, raising more than $40m across three campaigns and winning the site’s biggest investment.