Google to buy Nest Labs for $3.2 Billion

“Google Inc. agreed to buy Nest Labs Inc. for $3.2 billion in cash, extending the company’s reach into the home,” John Kell reports for The Wall Street Journal.

“Google said Nest will continue to operate under the leadership of founder and Chief Executive Tony Fadell,” Kell reports. “Google expects the deal to close in the next few months.”

Full article here.

“The deal comes just weeks after reports that Nest was raising around $150 million in new venture capital funding to be led by Yuri Milner’s DST Global, which apparently never happened (and possibly was never going to),” Dan Primack reports for Fortune. “Nest was founded in 2010 by Tony Fadell, a former Apple executive known for his design work on the original iPod.”

“Google also was an existing Nest investor, having led the company’s second round of VC funding in early 2011 via its Google Ventures group,” Primack reports. “To date, Nest had raised over $80 million in VC funding from Kleiner Perkins Caufield & Byers, Shasta Ventures, Google Ventures, Lightspeed Venture Partners, Intertrust and Generation Investment Management. Kleiner Perkins is believed to be the company’s largest outside shareholder.”

Read more in the full article here.

Google’s press release, verbatim:

Google to Acquire Nest

MOUNTAIN VIEW, CA – JANUARY 13, 2014 — 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.

Source: Google Inc.

MacDailyNews Take: Yum, ads for propane, heating oil, etc. right on your thermostat!

[Thanks to MacDailyNews Readers “Fred Mertz,” “macwolf,” “Jeff Daniel,” and “Jax44” for the heads up.]

Related articles:
Tony Fadell introduces Nest Protect smoke and carbon monoxide detector – October 8, 2013
Tony Fadell, Father of the iPod: From Apple to Nest Labs, always a designer – July 24, 2013
Apple Store to sell Tony Fadell’s Nest Learning Thermostat, report claims – May 25, 2012
‘Father of the iPod’ Tony Fadell shows off his new project: Thermostats – October 25, 2011

65 Comments

  1. … not cool

    Google has enough information about me, they don’t need to know my heating/cooling habits. I love my nest but now I’m wondering if I should look at something else…

    1. This is horrible news. Maybe the death stab for Nest too.
      Who in their right mind will allow Google to watch their every move.
      Next, Google will acquire security alarm and camera systems, and maybe wearable sheets, to actually monitor how you perform n bed?

      1. I worked in the electric utility sector until I retired a little over a year ago. We implemented a $150M “Smart Meter” system for a million customers that records electric usage every 15 minutes, and reports it every hour. The system allowed us to see energy theft, marijuana grow operations, and many other unusual consumption situations by automatically flagging them for human review. We were unable to comprehensively monitor for things like that in the past. We could tell when people got up in the morning and when they went to bed. We could tell when they cooked dinner, and when they did their laundry. We could tell when there were extra members living in a household, and when people went on vacation. Of course, that information was strictly confidential, and even we weren’t allowed to look at it without a demonstrated legitimate business reason.

        If you want Google to have unfettered access to that kind of personal information about your household, just go ahead and buy a Google enabled appliance or device, such as a thermostat, water heater, air conditioner, etc. As far as I’m concerned, such items will never get near my house.

        1. Yes it seems as usual most people complain about the obvious ‘spying’ concerns when they are revealed while they don’t give a second thought to the real stealth infiltration into their whole lives because apparently Google is so much more responsible with what it finds out than a Government Agency of course.

    1. I realized Nest was starting to get a lot of competition from several companies. These companies already had roads into the home through electricians, heating/cooling and cable companies.

      This is now a battle ground and those companies and Tony’s business plan could not compete with a very large sales force like this.

      Good for him. Another stupid acquisition from Google.

    1. I thought it said Apple bought Nest. I own the newest Nest thermostat and was looking to get 1 or 2 more with the new smoke detector. Not going to happen now. I will look into the other options first or just leave the old units alone.

      Tim and the Apple board, you should have picked it up if Google was in talks with them. I do not want Google or Microsoft in my house. Did not need them before and don’t want them now!!!

  2. Just bought another Nest and 3 Nest Protects last month, while at the same time closing down my gmail and other ties with Google because I’m really not trusting those guys. This just SUCKS! 🙁

    Why couldn’t Apple have bought them??

    1. After your next firmware update on the Nest Protect: “*beep beep beep* Fire in the sitting room. Next time, use an extinguisher from Flaming Joe’s, located 1.2 miles from you.”

        1. So go buy an AppleTV and an antenna for your roof. That’s what I did. It’s a pleasure to throw all those cable/satellite “special deals” into the recycling bin unopened when I bring the mail in.

        1. I actually passed on the Nest because it was reported that on a power failure the Nest sometimes needed human intervention to reconnect to the network and retrieve it’s programming. Under some circumstances (freezing weather and owner out of town) people had experienced frozen pipes and serious water damage due to this glitch.

  3. Apple should have bought it. Their aesthetic disciplines are more in line with Apple’s than Google’s. They would turn sleek futurism into candy colored cartoony immaturity.

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