It's no small secret that Nest is struggling a bit. The startup was acquired by Google in 2014 for $3.2 billion, but its sales have not been blowing up as much as Google had likely hoped they might. The company hasn't really released a major new product since its acquisition -- not counting any updates or new iterations to its existing thermostat and smoke alarm. (We suppose you could call its camera a "new" product of sorts even though it's just a rebranded Dropcam).
Nest is even having trouble finding traction at Google. Consider how Google famously indicated to Nest that it didn't need the company's help designing a competitor to the Amazon Echo, even though that seems as if it would be a great kind of a product for Nest to work on.
With the vesting schedule for Nest executives rumored to be up this year -- which means they'll be able to cash out their stock and then do whatever they want with their lives -- it stands to reason that we'll likely see some shakeups at the company soon. One big shakeup, though, is that Nest's CEO is officially moving on. Tony Fadell is out, and replacing him will be Marwan Fawaz, formerly the CTO at Charter and an executive vice president at Motorola Mobility.
"Last year, I began discussions with members of my team about my next endeavor. After six years of working on Nest, leading it through 4.5 years of double-digit growth and consistently high marks from customers, I leave Nest in the hands of a strong and experienced leadership team, with Marwan at the helm and a well-defined, two-year product roadmap in place. I'm looking forward to my new role as an advisor to Alphabet and [CEO Larry Page], which will give me more time and flexibility to pursue new opportunities to create and disrupt other industries -- and to support others who want to do the same -- just as we've done at Nest," reads a statement from Fadell, as reported by The Verge.
We'll be curious to see what's on that two-year roadmap. As Fadell wrote in a separate blog post, Fawaz will be looking to scale up Nest's business in his new tenure. And new "innovations" at Nest are allegedly in the works, but that's as much as Fadell teased about that.
Alphabet CEO Larry Page echoed similar thoughts in his own statement:
"Under Tony's leadership, Nest has catapulted the connected home into the mainstream, secured leadership positions for each of its products, and grown its revenue in excess of 50 percent year over year since they began shipping products. He's a true visionary and I look forward to continuing to work with him in his new role as advisor to Alphabet. I'm delighted that Marwan will be the new Nest CEO and am confident in his ability to deepen Nest's partnerships, expand within enterprise channels, and bring Nest products to even more homes."
You'll note that "fold Nest into Google's existing hardware divisions" isn't in that statement at all. So, it seems as if Nest will continue to march to its own pace -- for now, at least. We also wonder how Fawaz's management style might differ from Fadell's, too, given that the latter was, in some ways, trying to become the next Steve Jobs of the smart home. But don't take our word for it; consider what Dropcam CEO and founder Steve Duffy had to say about Fadell and Nest.
"There is a lot that I could say about my extreme differences on management style with the current leadership at Nest, who seem to be fetishizing only the most superfluous and negative traits of their mentors. For the sake of the customers and for the talented employees that remain there, I hope they find a way through these struggles," he wrote in March.