In an interview with Tech Insider, Pebble CEO Eric Migicovsky said the company would be cutting 40 employees – about 25 percent of its staff. He attributed the layoffs to a toughening venture capital environment in Silicon Valley, despite the company raising $26m in investment over the last eight months.
Pebble is not the only wearable tech company adjusting its products or workforce
“We’ve definitely been careful this year as we plan our products”, he said. “We got this money, but money [among venture capitalists in Silicon Valley] is pretty tight these days.”
Pebble popularised the smartwatch: after launching its first Kickstarter campaign in April 2012, it amassed over $10m from backers to fund its first watch. It launched a second Kickstarter for a revised design in February 2015 and generated over $20m. At the start of March, it cut the prices of its Time and Time Round models by $50, to $149.99 and $199.99 respectively. The company also launched an integrated fitness tracker at the end of last year, a feature Migicovsky said most users are interested in.
The overall health of the wearable industry is difficult to gauge, but Pebble is not the only company adjusting its products or workforce. Last week, Apple cut the price of its entry level Apple Watch to $299, a drop of $50. While Apple has not released sales figures for the Apple Watch, the price cut suggests it is not performing as well as the company had hoped. FitBit’s shares have fallen considerably this year after it released lacklustre projections. Acquisitions have also begun, with Misfit having been purchased by Fossil Group for $260m last year.