Three years after launching its smart thermostat, Nest is being acquired by Google for $3.2 billion in cash. The deal is subject to customary closing conditions and is expected to close in the next few months.
Nest will remain a separate brand identity, according to the deal. Tony Fadell, Nest co-founder and the former Apple executive known as “the father of the iPod,” will continue to lead the company.
“We’re thrilled to join Google,” says Fadell. “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’s founders, Tony Fadell and Matt Rogers, have built a tremendous team that we are excited to welcome into the Google family,” says Larry Page, CEO of Google. “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!”
According to The Next Web, “Google Ventures had been one of Nest’s earliest investors. It led the startup’s Series B financing in 2011, as well as its Series C round in 2012. Fadell demoed the Nest Thermostat to Google co-founder Sergey Brin ahead of the device’s launch in 2011.”
In early January, it was reported that Nest was close to raising $150 million in a new round of financing that would value the company at $2 billion. The report said that the $2 billion valuation could be even higher as several investors were vying for the deal, but that “the transaction appears to have been clinched by Yuri Milner’s DST Global investment firm.
The Nest Protect smoke detector.
Nest founder and CEO Tony Fadell in the company’s offices in Palo Alto, Calif. (Credit: Nhat V. Meyer/Bay Area News Group)
DST has the bulk of the new investment, said sources, but current investors – including Google Ventures, Shasta Ventures, Kleiner Perkins, Generation Investment Management, Lightspeed Venture Partners, Venrock and others – will also participate.”
Fadell gave the opening keynote at CEDIA Expo 2013 where Nest made a major splash by opening up the API on its learning thermostats and announcing a developer program.
Matt Rogers, Nest co-founder and VP of engineering, posted the following Q&A about the future of Nest:
Today is undoubtedly an exciting day for all of us at Nest, but it’s also meaningful for you, our customers. I’m sure you have questions about what today’s news means for you, the Nest Thermostat, and Nest Protect. While Tony answered many of the broader questions regarding our new partnership with Google, I thought we’d talk product – my favorite!
Before we dig in, I want to acknowledge what I consider the first great Nest partnership. I’m not talking about Google. I’m talking about the one between you and the team here at Nest. Some of you have been with us since day one while others learned about us more recently, maybe while watching The Ellen DeGeneres Show or hitching a ride on the Nest Fire Truck. One thing’s for sure – there’s no way our products would be what they are today without you, so thank you.
We’re looking forward to continuing our great partnership and remain devoted to you above all else. We know you entrust your homes and information to us and are committed to protecting that the same way we’ve always done.
Now onto the Q&A. I’m sure you’ll notice that not much will change – that is our intent!
Will Nest continue to support iOS so I can have the Nest app on my iPhone or iPad?
Yes, absolutely. We’ll continue supporting iOS, Android and modern web browsers so you can check in on your home and control the temperature from wherever you are.
Will Nest and Google products work with each other?
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.
What will happen to the Nest warranties on products?
No change there – we stand behind our products like we always have.
Will I still be able to find Nest products at my local retailer?
You bet. We intend to continue selling through the same partners in the US, Canada and the UK.
Will Nest customer data be shared with Google?
Hopefully I’ve covered all of your questions related to the Google partnership, but if not, feel free to hit me up on Twitter (@nestmatt). I’ll answer what I can.
Let’s do this!