An investment fund has dropped the price of its equity in the consumer technology startup Jawbone to less than 1 cent per share, according to a Thursday securities filing. It’s the latest in a string of setbacks for a company that once seemed poised to shake up the wearables market.
The investment firm BlackRock recently raised the likelihood of Jawbone being sold from 50% to 75%. The drop in share price may show BlackRock’s lack of confidence that a sale would enable the firm to pay off its equity shareholders, . Jawbone told Co.Design they do not have a comment.
Once lauded for its thoughtful design, Jawbone struggled to perfect the many iterations of its fitness tracker or streamline its manufacturing process. According to Tech Insider, the company has had chaotic–and possibly self-destructive–product-testing methods. A tendency to make last-minute changes paired with a lack of direction from higher-ups has resulted in an inability to plan successful launches. This has hurt business. One former executive complained to The Information last year that Jawbone “can’t get out of this cycle of products that are beautiful that don’t make money.” The latest estimate of the wearables market from the International Data Corporation doesn’t mention Jawbone at all.
With BlackRock’s devaluing of its shares, Jawbone’s future remains uncertain, especially after the company’s tumultuous trajectory. After raising more funds earlier this year, Jawbone watched the departure of its recently hired president, Sameer Samat. The company is also embroiled in a lawsuit with FitBit, which Jawbone sued over a trade secrets dispute. To bounce back from its chronic problems, the company needs another hit product–CEO and founder Hosain Rahman has teased wearables with medical-grade monitoring. Jawbone’s future may depend on it.KS