Jawbone, the wearable fitness company, is reportedly getting out of the consumer hardware market after its wearable fitness devices were marred by a slew of bad reviews and reports in the press that the company has no money left.
According to a report by TechCrunch, Jawbone is gearing up to pivot its business again, focusing on a higher-margin health product and set of services to go along with it that are sold mainly to clinicians and health providers. In order to support the company’s business shift away from low-margin fitness devices, Jawbone is looking to raise more funding. TechCrunch, citing unnamed sources, reported Jawbone has held talks with its current backers, as well as new potential strategic investors in the medical industry. It’s also talking to investors outside of the U.S.
Jawbone declined to comment on the report, and it’s not clear how much it is aiming to raise. To date, Jawbone has raised $951 million, according to the report, with investors including Andreessen Horowitz, Sequoia, Kleiner Perkins, JPMorgan, Mayfield and Khosla. Jawbone has already used up most of that funding, if not all of it, noted the report, and doesn’t have much to show in return, which could hurt its new fundraising efforts.
Jawbone’s move to shift beyond wearable fitness trackers comes at a time when the industry as a whole is struggling with lackluster demand. Fitbit has said it is shifting to become a digital health care company, and rumors abound that it may roll out a smartwatch and an app store. Reports even surfaced that Fitbit at one point looked to acquire rival Jawbone.