Fitbit confirmed in an announcement that the deal to buy assets of smartwatch company Pebble is coming to a close. The move comes at a time when Pebble seems to be suffering financial struggles. Fitbit has taken this opportunity to gain use of Pebbles cloud system, apps for its watches, and the people that are familiar with creating the technology for the company.
According to Bloomberg, Fitbit said that it will be offering jobs to many Pebble employees. However, Pebble CEO and founder, Eric Migicovsky won’t be staying with the company after this transition but moving on Y Combinator as an advisor. Even though Fitbit plans to spend almost $40 million on Pebbles assets, this doesn’t really cover the debt that Pebble is in.
Pebble was first started in 2012 on Kickstarter and had no problem attracting users to its items. Earlier this summer, Pebble released three new watches. The Pebble 2, Pebble Time 2, and Pebble Core were launched as follow ups to it initial watches. The Pebble Core was supposed to have a faceless feature, an option for offline music, and GPS, but according to a source Pebble Core and Pebble Time 2 are to be discontinued. The funds from the canceled projects will be returned to Kickstarter.
Fitbit has had its own financial struggles this year. Its stock recently dropped in November by thirty-four percent. Its initial hope is that the assets bought from Pebble will help expand Fitbit products along with its audience. Fitbit CEO James Park announced in a press release,
“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.”