Another Startup’s Successful Failure?

Or was it
a Failed Success?
 PEBBLE SUMMARY
FOUNDING: Eric Migicovsky, started operations in 2012.

BACKGROUND: Grew out of InPulse – a companion device to BlackBerry

IDEA: Receive texts, calls, emails and more on your wrist.

HIGH POINTS:
• First startup to use alternative funding and financing sources – crowd sourcing.
• Found huge success, $10.3 Million (1st time), $20 Million (2nd time).
• Innovative Products that captured the imagination of people - $230 Mn in Sales.
• Redefined what a smartwatch meant and could do… Disruptive innovation.
LOW POINTS:
• Despite huge amounts from crowdfunding, investors refused to finance – no confidence in company.
• Vague Aim & Improper roadmaps, strategies – failed to innovate.
• Acquired by Fitbit in 2016 (a competitor) and harvested for IP, workforce, etc. – sold to cover debts.
BEFORE PEBBLE…
 PROBLEMS WITH EXISTING OFFERINGS.
CLUNKY.
GIMMICKY.
VALUE ADDED TO CUSTOMERS – NEXT TO NONE.

NOT ACTUALLY SMART, JUST ADDON FEATURES THAT DO NOT MAKE SENSE.

DESIGN WAS UNINSPIRED.

SMARTWATCHES – THE NEXT BIG THING SINCE MAC INTRODUCTION IN 1984.

NO EXTENDEABILITY, NO FELXIBILITY – INCREDIBLY LIMITED.

PEBBLE
 PEBBLE’S SOLUTION.

EASY, INTUITIVE WELL-DESIGNED AND FOR A FOCUSSED OR

DESIGN. DELIVERED NICHE MARKET, IT
SOFTWARE. FREED THEIR
DEPENDENCY ON
SMARTPHONES.

TRULY SMART & INCREDIBLY REINTRODUCED THE

CONNECTED WITH EXTENEDABLE – FUTURE OF
BOTH iPhone & CUSTOM WATCH SMARTWATCHES.
Android. FACES, 3RD PARTY
APPS.
 BUSINESS MODEL CANVAS
1. COMMON CUSTOMER 1. PRODUCT 1. HASSLE-FREE 1. SELF-SERVICE 1. TECH
2. CO-DEVELOPERS FEATURES DEV. EXPERIENCE 2. AUTOMATED ENTHUSIASTS
3. MUTUAL SUCCESS 2. UNIFIED 2. FREE, LIGHT, EASY-TO- 3. CO-CREATION 2. LESS
(ESPN, MERCEDES- PLATFORM DEV. USE, INTUITIVE DESIGN 4. COMMUNITIES SMARTPHONE-
BENZ, PANDORA, EBAY, 3. TRULY SMART, CENTRIC
RUNKEEPER, WIRELESS 3. PRODUCTIVITY
JAWBONE, etc.) COMPANION FOCUSSED
4. CONTRACT 1. DEVELOPERS 4. EXTENDIBLE, FLEXIBLE 4. MINOR FOCUS
MANUFACTURERS & 2. INVESTORS 5. MULTI-PLATFORM 1. ONLINE – - FITNESS
SUPPLIERS 3. SUPPLIERS 6. AFFORDABLE AMAZON, etc.
4. MARKETING 2. RETAIL – BEST
5. SALES BUY
3. COMPANY-
OWNED

COST-DRIVEN FROM HARDWARE, VALUE-DRIVEN IN SOFTWARE. SALE OF PRODUCTS, (FUTURE – APP STORE COMMISSIONS).
 WHY DID PEBBLE FAIL?
A Startup relies on disruptive and constant innovation – competitive advantage.
Pebble’s competitive advantage from innovation was sorely limited; a companion device requires a
phone – easily imitable by big brands.
Economies of Scale are essential for the demographic of middle-income consumers and achieve
profitability – unable to achieve economies of scale.
Marketing catastrophe – neither financiers, nor consumers could truly understand the potential of
Pebble’s offerings; Constantly tried to reposition.
No Strategic Goals, No vision, No mission.
Excellent product; limited hardware design prowess.
Supply Chain Troubles.
Finances were always an issue – no working capital, no investors, no lenders.
THANK
YOU
 BIBLIOGRAPHY & REFERENCES
1. Jellicorse, Robert W., "2015-2016 Pebble Smartwatch 5. https://www.wired.com/2016/12/the-inside-story-
Advertising Campaign" (2015). Chancellor’s Honors behind-pebbles-demise/
Program Projects. 6. Wsj.com
2. SHIN, M. H., & Lee, Y. M. (2020). The effects of 7. https://slidebean.com/story/what-happened-to-
consumption value and consumer trust on pebble-smartwatc
crowdfunding participation intention. Journal of 8. Wikipedia.com
Distribution Science, 18(6), 93-101. 9. Latimes.com
3. Schneper, W. D., & Martin, C. (2018). Pebble 10. Pcmag
Technology Corporation: From dorm room dream to 11. Yourtechstory
high tech pioneer. The CASE Journal. 12. Medium.com – Enrique Dans, RVZIONNE.com,
4. Rawassizadeh, R., Price, B. A., & Petre, M. (2014). Aditya Kothadiya
Wearables: Has the age of smartwatches finally 13. Founder – ERIC MIGICOVSKY
arrived?. Communications of the ACM, 58(1), 45-47. 14. Prezi.com