Tony Fadell, the founder and CEO of Nest, the ‘smart thermostat’ company bought by Google back in 2014 for $3.2 billion, is leaving the firm. He will “remain involved” as part of his new role as an advisor to Alphabet and its CEO, Larry Page.
Fadell was also in charge of Google’s revamped Glass project.
Marwan Fawaz, a managing partner at Sarepta Advisors, who was previously executive vice president at Motorola Mobility, will take Fadell’s place.
Fadell said in a blog post that Fawaz’s technology and engineering knowledge will be valuable in continuing Nest’s trajectory, “especially in scaling the business, working with our partners, and supporting our enterprise channels.”
He claimed that his departure was set in motion late last year and will give him the time to pursue new opportunities “and disrupt other industries”.
The news will not come as a surprise to those aware of Nest’s recent troubles. According to Re/code, Nest generated about $340 million in sales last year, below Google’s expectations.
What’s more, it has been dealing with staff departures, including the CEO of Dropcam, acquired by Nest for $555 million six months after coming under Google. Greg Duffy criticised Fadell and said he regretted the sale, citing “extreme differences on management style with the current leadership at Nest”.
Meanwhile, Fadell attempted to downplay negative response to his exit by claiming that Nest’s revenue had grown in excess of 50 per cent year-over-year and that millions of people in more than 190 countries use its products, which include hardware, software, services, and the Nest-backed Thread wireless protocol.
In 2015, it shipped four new hardware products and released five apps and more than 18,000 developers are now building their own products and services on Nest’s platform.
“The future of Nest is equally as bright given the strong and experienced leadership team in place, as well as the two-year product roadmap we’ve developed together to ensure the right future direction,” Fadell said, adding that “the connected home went mainstream because of Nest.”
As for what is next for him, he told Bloomberg he has been “secretively” investing in over 100 companies who have “disruptive ideas that can change the world” and who he has been helping with marketing and product designs.
“So I’m just going to continue to do that while I advise Larry and Alphabet,” he said.
Nest is one of the main revenue sources for Alphabet’s “Other Bets” businesses. Other Bets made an operating loss of $3.6 billion in 2015, a widening from $1.9 billion the previous year. 2015 revenue was $448 million, up from $327 million in 2014.