January 14, 2014
Google is laying out a substantial amount of cash to purchase Smart thermostat and smoke alarm maker Nest Labs.
For a cool $3.2 billion, Google will acquire the Silicon Valley company co-founded by former Apple employee Tony Fadell to reinvent unloved but important devices in the home.
The deal is expected to close in the next few months.
“Nest’s founders, Tony Fadell and Matt Rogers, have built a tremendous team that we are excited to welcome into the Google family,” Google CEO Larry Page said in a press release.
“They’re already delivering amazing products you can buy right now — thermostats that save energy and smoke/CO alarms that can help keep your family safe. We are excited to bring great experiences to more homes in more countries and fulfill their dreams.”
Since Nest launched in 2011, its learning thermostat has been a constant best seller, while its recently-launched Protect (Smoke + CO Alarm) has received rave reviews, the press release said.
Fadell, who will continue on as CEO of the firm, said in a blog post that “Nest will continue to be Nest, with its own distinct brand identity.”
The blog post emphasized that staffing will not be affected by the acquisition. Rogers, for instance will remain in his current role as head of engineering.
Fadell said although business was booming for Nest, he knew the partnership with Google would enable the company to accelerate its innovation pace and extend its reach.
“Google has the business resources, global scale and platform reach to accelerate Nest growth across hardware, software and services for the home globally,” Fadell said in a blog post. “And our company visions are well aligned – we both believe in letting technology do the hard work behind the scenes so people can get on with the things that matter in life. Google is committed to helping Nest make a difference and together, we can help save more energy and keep people safe in their homes.”
Fadell said he has been in contact with Google in one form or another for the past three years.
“At the 2011 TED Conference, Erik Charlton and I huddled in a corner with (Google co-founder) Sergey Brin to show him a video and an early model of the Nest Learning Thermostat – he instantly got what we were doing and so did the rest of the Google team when we showed them,” he said.
Google not only showed an interest in the young company, but invested in it as well. Google Ventures led the firm’s Series B round of financing in May 2011 and its Series C round in 2012.
“Time and time again, Googlers have shown themselves to be incredibly like-minded, supportive and as big of dreamers as we are,” Fadell said. “I know that joining Google will be an easy transition because we’re partnering with a company that gets what we do and who we are at Nest — and wants us to stay that way.”
Jennifer Cowan is the Managing Editor for SiteProNews.