Despite Popular Kickstarter, Pebble Seeks $5 Million Loan 'To Stay Afloat'

[newdeal]

Maybe you're right but I expected them to have shipping handled by a courier and I also expected them to have a manufacturing partner.

Are they actually making and shipping the watches by hand and those 150 employees are included in that?

I was thinking the 150 was just hardware and software designers and their managers.

I doubt they are making them, they likely have them made in china like everything else. I would not be surprised though if they were shipping them from a warehouse in the USA somewhere

 

[keysofanxiety]

150 people paying themselves a nice salary from the KS funds all the suckers (marks) gave them. I need to start a KS fund and pay myself $500,000 salary.

Well it doesn't even have to be a nice salary. Even if each of them was just getting minimum wage (for argument's sake we'll say $1000 a month), that's still $150,000 per month that they're losing on wages alone. Plus you've got maintanence costs for the building like electricity, water, gas, cleaners, catering, buying computers, servers, servicing stuff that goes wrong ... then you've got transport fees, advertising costs, manufacturing costs, warranty costs ... so, so, so many things that I'm sure would push it to $400,000 per month easy. And that's just a conservative estimate. Nearly $5 million a year -- and it's definitely much much more than that.

So yeah just to add to the other people, they have far too many employees. Poor management.

To paraphrase Jobs, it's funny how some ships leak from the top

 

[drewyboy]

Why does it seem people want and are happy to watch Goliath crush the little guy here?

I think most of us are sick of the arrogance that comes out of Silicon Valley. It's nice to see these types of people put in their place to bring them back to reality.

It isn't a matter of the size, but the attitude I dislike. If apple was arrogant, I'd like to see a startup or other large company put them back in their place. Difference here, Apple can weather a blow. Pebble, if this is true, can't. Being humble can take you a long way.

 

[unplugme71]

I agree with this completely. 150 people is a huge amount. I'd not see them needing more than 25 people when considering the hardware and software they've released so far. Definitely doesn't look like it came from a huge company with 150 employees.

150 is a lot for a company that just designs software and draws the hardware designs. I would say manufacturing is left to third-party.

CEO
2 marketing
1 hr/legal
1 AP/AR
2 product development
2-3 engineers
2 software developers
1 IT staff
1-2 website designer

easily under 25 people.


Last company I worked for we had 13 people in office with revenue of 3-5 million per month. We did manufacture our own stuff in a factory we owned that had a staff of up to 60 welders, machinists, etc. But the point is 11 people managed all them, payroll, hr, production management, etc.

 

[0098386]

Eep, looks like they peaked too soon. 150 staff seems way too much for their output.

I hope they can sort themselves out. Pebble watches are great, I'm flip-flopping on getting an Apple Watch (tempted to just wait for a gen 2 product) because the Pebble and its feature set has me covered.

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I doubt they are making them, they likely have them made in china like everything else.

They used to. When I backed the original Pebble they had updates on manufacturing, including trips to the factory in China for prototypes.

 

[Rigby]

I think that Pebble is a nice watch, but not as nice as the Apple Watch.

True, although the Time Steel seems to look pretty good (see e.g. here for some pictures). But of course the display is not as nice from an aesthetic point of view.

In addition, it is turning out to be less functional than the Apple Watch.

I would argue that it is actually superior to the Apple watch when it comes to what are currently the central functions of a smart watch: Showing notifications and telling time. The main reason is the always-on display. But it is also nice to have a watch that you can rely on without having to constantly worry about keeping it charged, e.g. when traveling. Pebble is just a more focussed product, whereas Apple Watch tries to do everything but doesn't really excel at anything. Perhaps it will change when some killer app is discovered, but I'm not holding my breath.

They will need to come up with something to stand out if they want to survive. Having a product that is not as good, aesthetically, not as good, functionally, and yet close in price, does not make a winning formula in the long run.

Pebble is much cheaper than the comparable Apple Watch models (e.g. compare Pebble Steel vs. Apple Watch stainless steel with link band).

 

[keysofanxiety]

Eep, looks like they peaked too soon. 150 staff seems way too much for their output.

Yep, it's not a good sign. I think there's a strong chance the company's going to go pop. I myself have never exploded, but I know what it would be like. Don't ask me how, I just know. I've always ... just known.

 

[Tycho24]

Why does it seem people want and are happy to watch Goliath crush the little guy here?

Well...
Many of us here remember (and still have it ingrained) when Apple was always the little guy. Daring to stand up to the bullying Microsoft. It felt like a personal victory to see them, without losing their souls & switching up their strategy of owning the entire hardware/software platform, take these companies down a notch.
It was awesome seeing Ballmer.... just dripping with ego (not sweat, for once) claiming that the iPhone simply wouldn't sell. It was cool that he casually discounted the company we believed in, and was SOOOOO WRONG!
Here it is happening again:
The guy from Pebble (though representing a much smaller company), also tried to casually discount an Apple product. Again, we are happy to see naysayers eat their words. It is NOT that we want them to fail. Indeed, I love the idea of cross-platform smartwatches. Just don't pretend like Apple is not even valid competition.

 

[macduke]

Because the "Little Guy" has serious attitude problem. Instead of being classy, the CEO mocked apple repeatedly, and if you have seen any video of him know this guy to be just plain creepy IMO.

I think most of us are sick of the arrogance that comes out of Silicon Valley. It's nice to see these types of people put in their place to bring them back to reality.

It isn't a matter of the size, but the attitude I dislike. If apple was arrogant, I'd like to see a startup or other large company put them back in their place. Difference here, Apple can weather a blow. Pebble, if this is true, can't. Being humble can take you a long way.

So many people forget how Apple Started out. Steve Jobs was extremely arrogant and they put out ads mocking IBM, trying to overthrow the establishment, etc. Then they targeted Microsoft like crazy with Mac vs. PC commercials and that worked out well. I guess the main difference is that Apple deserved to be arrogant because they really did have a better product. Pebble is just kinda not very good? Yeah. I'm excited for the next arrogant young company to come along and actually make something crazy cool.

 

[2457282]

plus their only advantage, which i battery life, doesn't really amount to much. Charging every day vs every 7 days really isn't that much of an issue to the general public. If Pebble has like 2 years battery life it would be different but as it is a nightly charging cycle is just easier to remember to do, although 2 days would be nice just in case you forgot

Well, the only benefit I see to the longer battery life is that with the sensors in the Apple watch you could monitor sleep patterns. If they could make it last a week, I could monitor sleep 6 nights a week. But then Pebble doesn't do that either, so I guess your point is still well taken.

 

[solarguy17]

True, although the Time Steel seems to look pretty good (see e.g. here for some pictures). But of course the display is not as nice from an aesthetic point of view.
/QUOTE]

You must be looking at different pictures then I am because I think that is one ugly watch. Then again, I don't like the way most watches (smart or not) look. The fact the screen is always on draws attention to the fact it has a huge ugly bezel. The overall design just seems poor.

I kind of like the AW because it's doesn't seem as bulky, the same goes for the Moto360.
Gear series, terrible.

 

[sracer]

I think most of us are sick of the arrogance that comes out of Silicon Valley. It's nice to see these types of people put in their place to bring them back to reality.

It isn't a matter of the size, but the attitude I dislike. If apple was arrogant, I'd like to see a startup or other large company put them back in their place. Difference here, Apple can weather a blow. Pebble, if this is true, can't. Being humble can take you a long way.

Some could say that Apple is exhibiting quite a bit of arrogance with regard to the smartwatch market. They let the little guys claw and scratch their way into this new market, then the 800 lb gorilla throws their weight and marketing muscle into the arena and squashes the little guys.

Without any track record in the smartwatch market they think that they can charge $150 for a leather band, simply because they're Apple. The sad part... they're correct.

 

[SchneiderMan]

150 employees?? Well there's your problem.

Now where's my check?

 

[jonnyb098]

Nothing to rejoice in here, people. As consumers, healthy competition benefits us all.

The pebble is garbage. The best competition is the Android wear.
Smart watches in general are an extremely niche product and will be for a while. Pebble is way too far behind to be of any relevance. Same thing happened with tablets. It took years for anyone to come up with a tablet to compete head to head with an iPad. Facts are facts.

 

[horsebattery]

Expected MR to post this sooner or later. Those that are familiar with Biggs will know that his articles are terribad and poorly researched. Startups commonly seek investment via VC grants and other sources. Seeking loans is actually indicative of Pebble attempting to grow. Also on Biggs, the comparison between the Pebble and the Olio is simply asinine; this is where the usual car analogies actually apply.

If we're just going to be looking at companies taking loans out of context, how about this "relevant" article from a while back? http://arstechnica.com/apple/2013/04/why-apple-added-debt-to-its-145-billion-cash-hoard/

Disclaimer: Not a Pebble owner/enthusiast/etc., simply trying to point out a badly written article

 

[budselectjr]

This explains why they used Kickstarter again. Just was a means to get a $18 million cash infusion to try and stay in business. This usually does not end well.

 

[Serelus]

I am really not sure this is all doom and gloom at this point. There is likely a logical business reason for them to need cash other than because they are going bankrupt. That said, I don't honestly see a long term potential for the company. I feel like as Apple pushes their watch to become more advanced Pebble will be left in the dust, however unlike when it happened to RIM as Apple pushed the iphone, Pebble won't have enough cash to even attempt recovery. That is likely why the banks won't give them money

For what exactly would they need another 5 million, they just got 20 million 3 months ago. Honestly this screams doom and gloom.

 

[nagromme]

I would have hoped by now they could stay afloat simply by selling products at a profit.

In any case, I hope they make it: a cheap option that aims for long battery life over functionality has a place in the market, in between Apple Watch and traditional watches.

 

[The WOPR]

I think most of us are sick of the arrogance that comes out of Silicon Valley. It's nice to see these types of people put in their place to bring them back to reality.

You do realize that Apple is in Silicon Valley correct? But go ahead and keep hating with your misconceptions.

 

[nutmac]

This just goes to reaffirm the age old saying, in the world of computing platforms, there can only be 2 platforms, with third struggling for survival unless it can usurp the second ranking platform on the next major upgrade cycle.

Is Fitbit next?

 

[bbeagle]

Maybe Apple Watches aren't overpriced after all.

If Pebble would have priced their watches higher, they wouldn't need the $5 million.

 

[jasonlevy]

If any of you were part of the first kickstarter campaign, you know that this is not surprising. The company was HORRIFIC at communicating with the customers, was incredibly arrogant and Eric clearly had no management skills whatsoever. I would like to think this is Karma coming back to knock Eric on his ass for that behavior, but really it simply is just business which he obviously is not good at.

 

[Chupa Chupa]

$5-10m is a drop in the bucket of what a high growth tech company like Pebble really needs to compete with a Google, Samsung, or Apple product. Any investor who puts money here either has too much money or not enough common sense. (I was an original Kickstarter supporter. These guys really don't know how to run a business, much less compete with behemoths like they must).

In truth Pebble was Android Wear and Apple's proof of concept to a degree. It never really had a chance. Bury the sucker and give it its deserved 21 notification salute. Too many products, not enough developers with enough time to develop for the smallest platform.

 

[gkarris]

I know someone that has the watch and it seems kinda cool. I went to look at prices and they were $150. Has a greyscale lcd screen.

Seems kinda high for something that looks like it came out of the Palm PDA era...

Just looked at prices and looks like they're $99 (maybe price drop after the Apple Watch announcement?). Still kinda high for the technology - maybe at $69....

 

[avanpelt]

150 staff members - and they couldn't field a spokesperson to say that officially?

Perhaps they can't because the outlook isn't so positive after all...

Yeah, 150 people on staff and none of them is a PR person? That's very odd for a company with that many employees.