Crowdfunding Success Story: Pebble
Over $230 million in sales and 2 million watches sold in 5 years!
Eric Migicovsky had a dream: to create a smartwatch that could do more than just display messages from a smartphone. He had been tinkering with the idea since the inPulse watch came out in 2008, but it wasn't until he joined the Y Combinator business incubator program in 2012 that he was able to bring his dream to life with the creation of Pebble.
Struggling to raise institutional capital, Migicovsky and his team decide to take their idea to the masses through a Kickstarter crowdfunding campaign. On April 10, 2012, Pebble officially started their 30 day crowdfunding campaign with the goal to raise $100,000 in order to produce a handful of Pebble Time watches. Within the first 24 hours, the campaign raised over $500,000. By the end of the 30 days, Pebble raised a total of $10 million, making it the most successful Kickstarter campaign at the time.
While the first campaign was a massive success, it also attracted attention from many competitors, including the likes of Apple. In 2015, Migicovsky and his team needed capital to produce their second-generation smartwatch, Pebble Time, but institutional investors were still hesitate to fund hardware. Once again, they decided to conduct a crowdfunding campaign on Kickstarter, raising $20 million in the second Kickstarter campaign, with over 75,000 backers.
However, Pebble made a crucial miscalculation about the direction of the smartwatch market. While they focused on the geeky/hacker user base, Apple focused on fitness, health, and wellness aspects of smartwatches. As a result, Pebble didn’t meet there 2015 revenue forecast of $100 million (they came up short with $82 million in revenue) and started looking for companies to acquire them.
Towards the end of 2016, Fitbit acquired Pebble for $23 million. While it was a disappointing end for the company, Pebble pioneered the smart watch market, sold over 2 million watches, and did over $230 million in sales within 5 years. These achievements were only possible because of the equity crowdfunding industry!