The Mess at Nest Echoes the Mess in the Smart Home

Nest isn’t alone in its challenges.

In January 2014, Google (now under the parent umbrella corporation Alphabet) said it would purchase Nest for $3.2 billion, which validated the hopes and dreams of hundreds of startups that were also building connected products for the consumer home.

After the deal was announced, the VC world went mad searching for investments, while larger companies searched for potential acquisition targets. At industry events that year, everyone I ran into with a connected product or a KickStarter was in talks to sell out or score more funds.

But two years later, the reality has set in as entrepreneurs in the space are dealing with a skeptical customer base and the challenges of seeing their grand vision for a connected home get mired in rival standards. Meanwhile, economic concerns are leading tech companies to prepare for everything from a nuclear winter to a mild recession.

If you want to understand the almost insurmountable challenges facing one of the hottest sections of the tech world today, see The Information‘s profile of connected-thermostat company Nest and how it has failed to execute on much of its promise. The story, which focused heavily on Nest co-founder and CEO Tony Fadell, exemplifies how an Apple-like attention to product, and a focus on building a platform instead of ecosystem can halt a promising vision.



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