The big news from this past week is that hardware company Jawbone is in the process of liquidating its assets. This was a nearly 20 year journey with almost $1B of financing going into the company, along with some pretty onerous financing terms along the way. We analyzed the company from start to finish here.
Jawbone rode the wearables hype train, reaching a peak valuation above $3B in 2014. But a couple of years ago sentiment around consumer wearables changed. The companies as a whole have not had the wild success that was promised. Super high abandonment rates are one issue, but exits in the space have been pretty lackluster too. Even poster child Fitbit has not exactly blown up in public markets (well, at least in the positive connotation).
Jawbone’s valuation decline was probably a leading indicator for Fitbit’s. But as its public company comparable started to slide, it certainly did not help Jawbone whose terms got more onerous.
The interesting development is how wearables are now going into the medical-grade area. Fitbit has dabbled in clinical trials in the past, the Apple Watch has medical-grade ECG straps from AliveCor and ResearchKit. Even Jawbone’s founder is apparently starting a health wearable company.
Companies once avoided the regulatory overhead of medical grade hardware, but now it’s become a way to create actionable data in clinical settings. This was the quantified-self movement’s dilemma: it couldn’t create data that people trusted and there wasn’t much you could do once you had it. A doctor is rarely going to take the data seriously without it going through a rigorous testing process.
However medical device makers should keep these companies in mind. Strong consumer brands getting into healthcare is a trend we’ve talked about before, and represents a different way of thinking for traditional incumbents. We talked about this and other trends in a previous med device webinar.
We made a collection of wearables company, both medical-grade and otherwise. Check it out here.