Google is making a big bet on the future of the connected home, announcing today that it has acquired Nest for $3.2 billion in cash.
The acquisition comes just about a year after Nest raised $80 million in venture funding, reportedly at a valuation of $800 million. At the time of that deal, the company was reportedly shipping 40,000 to 50,000 of its thermostats per month. The thermostats, which allow users to regulate temperatures in a home while on the go, sell for $249.
Late last year, it released a new smoke and carbon monoxide detector, the Nest Protect, for $129.
Yoky Matsuoka, a former University of Washington computer science professor, serves as Nest’s vice president of technology. The company is led by former Apple exec Tony Fadell. Interestingly, the news comes on the same day that SNUPI Technologies — a University of Washington spin out that’s developing connected devices to detect water leaks and mold — raised $7.5 million in a series A financing. (Maybe the valuation would have been a bit higher had they waited a few days?)
In a Q&A released by Nest, the company isn’ saying how it will integrate with Google, though it added: “Nest’s product line obviously caught the attention of Google and I’m betting that there’s a lot of cool stuff we could do together, but nothing to share today.”
Some may worry about privacy concerns or information regarding movements in one’s home being shared with Google, but Nest said that they’ve “always taken privacy seriously and this will not change.”
Meanwhile, Recode.net reports that Google was the only serious bidder for Nest, which was getting ready to raise another round of funding at a $2 billion valuation when Google made its offer.
Previously on GeekWire: Review: Nest Protect brings high-tech features to the lowly smoke detector
Here’s the full press release from Google:
Google Inc. (NASDAQ: GOOG) announced today that it has entered into an agreement to buy Nest Labs, Inc. for $3.2 billion in cash.
Nest’s mission is to reinvent unloved but important devices in the home such as thermostats and smoke alarms. Since its launch in 2011, the Nest Learning Thermostat has been a consistent best seller–and the recently launched Protect (Smoke + CO Alarm) has had rave reviews.
Larry Page, CEO of Google, said: “Nest’s founders, Tony Fadell and Matt Rogers, have built a tremendous team that we are excited to welcome into the Google family. 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. We are excited to bring great experiences to more homes in more countries and fulfill their dreams!”
Tony Fadell, CEO of Nest, said: “We’re thrilled to join Google. With their support, Nest will be even better placed to build simple, thoughtful devices that make life easier at home, and that have a positive impact on the world.”
Nest will continue to operate under the leadership of Tony Fadell and with its own distinct brand identity. The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the US. It is expected to close in the next few months.
About Google Inc.
Google is a global technology leader focused on improving the ways people connect with information. Google’s innovations in web search and advertising have made its website a top internet property and its brand one of the most recognized in the world.
