Jawbone might pivot to the medical industry as it exits the consumer market, according to people close to the company. It has already sold all its assets for the Jambox speaker business, and has heavily reduced its customer support staff.
The private company is apparently talking to several investors about a new funding round, aimed at pushing Jawbone into the medical industry. It plans to sell a hardware device with a range of services, which will be sold (or licensed) to clinicals and health providers.
Jawbone hopes that the pivot from a low-margin consumers model to a high-margin B2B model will change the company’s fortunes.
It has been over two years since the company’s last major hardware update. In that time, its value has went from a reported $3 billion to less than $1 billion. Blackrock, a major investor, seemed to indicate that its stake in the company is worthless a few months ago.
Jawbone’s problems come from all directions: It struggled to compete with Fitbit, which undercut the company on price and stormed ahead on functionality. It failed to update its wearable devices and provide adequate updates and fixes. And the wearables industry fell into a slump after the initial excitement wore off.
Even if Jawbone succeeds in pulling the necessary cash to enter the medical industry, it does not mean they will find success. Several firms already sell wearables to professionals and Jawbone does not have a stellar record for customer service, regular updates, and wide-ranging functionality.
The company will need to prove that it has more than unique design if it wants to win over an industry that cares more about accuracy and dependency than style.