Ex-Nest CEO Tony Fadell Points Out Google’s Spin Off Decision


We all know that, Google has integrated the smart thermostat company, Nest earlier this week once again. Back in 2014, it acquired the company for $3.2 billion but later spin-off happened in 2015 during the restructuring that created the Alphabet holding company. Bringing Nest back under its wing has some former employees of the smart-thermostat maker saying the company never should’ve been spun off in the first place.

Tony Fadell, co-founder and ex-CEO of Nest, said both companies’ efforts in connected gadgets were hurt when Google made Nest a separate business less than two years after acquiring it. Google bought Nest in 2014 for $3.2 billion, and the spin-off happened in 2015 during the restructuring that created the Alphabet holding company. “From the outside it looked like Nest was the perfect poster child for Alphabet,” Fadell told CNBC.

He further added, “But at the same time, separating it was undoing the thing that was most essential for both companies — figuring out how to make them work together.” “Nest was acquired by Google for a specific reason,” Fadell told the network. “I pitched it as ‘We are the senses and you are the brain.'” Mr. Fadell also confirmed previous rumors that Google was mulling over the idea of offloading Nest in 2016, presumably at a significant loss.

CNET reported, Nest is now rejoining Google only a year and a half after being spun off, with its second restructuring also being set to lead to the departure of the firm’s second co-founder, Matt Rogers. “I think it would have helped had the [mergers and acquisitions] team put something in place in the early days to structure and incentivize Google and us in a way that would have led to more cooperation,” one of the ex-employees told the network.

“It was like a soap opera,” one of the former staffers said.

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