Jun
22
2014

Google and it’s burgeoning ‘Nest’ – bought Dropcam for $555 million

Google and it’s burgeoning ‘Nest’ - bought Dropcam for $555 million

Google and it’s burgeoning ‘Nest’ – bought Dropcam for $555 million

Dropcam, the popular home monitoring solutions provider is to be acquired by Nest, producer of smoke detectors and smart thermostats. It will be netting a cool $555 million in cash in the process. Dropcam’s origin story is quite bewildering in itself. It was founded in 2009 after CEO Greg Duffy wanted to come up with a way to see who was letting their dog poop on his father’s yard.

Nest, a company which was just purchased by Google barely a few months ago for $3.2 billion seems pretty adamant in clearing any lingering doubts of google’s involvement in the acquisition. It has made it certain that the acquisition will be taking place independently, outside of Google.

Dropcam will become a primary subsidiary to Nest’s own brand and will also be subject to its privacy policy according to Matt Rogers, Nest co-founder and VP of engineering.

“The teams are very well-aligned and we love the product,” Rogers said. “We both think about the entire user experience from the unboxing on. We both care deeply about helping people stay connected with their homes when they’re not there.”

The deal was signed Friday and has yet to close. The Dropcam team will move from San Francisco to Nest’s offices in Palo Alto. Dropcam has been the purveyor of security cameras and cloud storage systems for video recordings and has routinely been the top selling security camera provider on Amazon.

Dropcam originally tried to use existing webcams to support a hosted personal video archive but soon after it began manufacturing its own.

Online storage is the other part of Dropcam’s business model. The company charges $99 per year to save a week’s worth of video at a time.
According to recent statistics quoted by Dropcom, nearly 39 % of people who purchase their security cameras also end up buying into its cloud storage system.

Dropcam had been able to raise a total of $48 million from investors including Institutional Venture Partners, Accel Partners, Menlo Ventures and Kleiner Perkins Caufield & Byers. Rogers commented that the company would be treating Dropcam user data just like it does with the data it’s gathering from its own products, which basically means Google will not have access to it. Rogers also promised tighter integration between Nest products and Dropcam.

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