Google has acquired Nest Labs, the maker of the popular learning thermostat.
Tony Fadell is a man on a mission. After serving Apple's iPod division, the 44-year old engineer labeled as the "Father of the iPod" went on to co-found Nest Labs in 2010 with iPhone engineer Matt Rogers. But Fadell may have just achieved his biggest success to date - locking a billion dollar deal with today's top technology company: Google.
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The Mountain View-based giant has just acquired Nest Labs for $3.2 billion in cash. The news today ends an era of rumors and speculations. Last year, Nest Labs was rumored to be up for sale. Apple was even reported to be interested in buying the company. It sounded tangible considering Fadell's roots and the fact that many Nest employees came from Apple. Google, on the other hand, was earlier rumored to be working on its own energy-saving thermostat, dubbed "EnergySense."
Announcing on its official website, Google CEO Larry Page said that he is excited to bring Nest's technology to more homes in more countries. "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," Page said.
It was a deal waiting to happen. Fadell said that he met with Google co-founder Sergey Brin at a TED Conference in 2011 and showed 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," recalled Fadell.
The brief presentation turned out to be a success. Google's investment arm, Google Ventures, went on to lead a Series B round of financing for Nest Labs a couple of months after, and came back with a Series C funding a year later. "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," he quipped.
Fadell also shed light on its decision to partner with Google. He said that Google will help Nest fully realize its vision of the conscious home. "Google will allow us to change the world faster than we ever could if we continued to go it alone. We’ve had great momentum, but this is a rocket ship," Fadell said. He also pointed out that Google's business resource, which included a plethora of hardware and software services, will accelerate Nest's growth globally.
"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," he added.
Google also confirmed that Nest will continue to operate as a distinct brand, with Fadell as its CEO. As usual, the deal is still subject to customary closing conditions and is expected to close in a few months. Google will now become a key player in the race to build smart energy-efficient homes.