Did VCs Avoid Pebble Watch Because Of Fear From Apple?

Posted May 1, 2012

Pebble Technology has been one of the most successful projects on Kickstarter by raising over $7 million with 17 days left. Pebble Technology founders attempted to contact venture capitalists, but none of them really responded receptively to their ideas. This is why they turned to Kickstarter. Why were VCs not interested? Federated Media founder and Wired founding editor John Battelle has a theory.

Here?s why. If you watch the video explaining Pebble, it become pretty clear that the watch is, in essence, a new form factor for the iPhone. It?s smaller, it?s more use-case defined, but that?s what it is: A smaller mirror of your iPhone, strapped to you wrist. Pebble uses bluetooth connectivity to access the iPhone?s native capabilities, and then displays data, apps, and services on its high-resolution e-paper screen. It even has its own ?app store? and (upcoming) SDK/API so people can write native apps to the device.

In short, Pebble is an iPhone for your wrist. And Apple doesn?t own it.

If we?ve learned anything about Apple over the years, it?s that Apple is driven by its hardware business. It makes its profits by selling hardware ? and it?s built a beautiful closed software ecosystem to insure those hardware sales. Pebble forces an interesting question: Does Apple care about new form factors for hardware? Or is it content to build out just the ?core? hardware platform, and allow anyone to innovate in new hardware instances? Would Apple be cool with someone building, say, a larger form factor of the iPhone, perhaps tablet-sized, driven by your iPhone?

I agree with Battelle in the sense that Pebble is at risk of Apple cutting them off. That is what make start-ups so great though. They are willing to take high-risk, high-reward chances to do something great. The result: either soar like eagles or crash and burn, then move on to something new.