Google Steps up its Game in Healthcare Wearables - Acquires Fitbit

Google Steps up its Game in Healthcare Wearables - Acquires Fitbit
Case Code: BSTR592
Case Length: 13 Pages
Period: 2014-2019
Pub Date: 2020
Teaching Note: Available
Price: Rs.400
Organization: Fitbit
Industry: Healthcare and Services
Countries: United States
Themes: M&A , Diversification Strategy, Technology in Healthcare, Competitive Strategy
Google Steps up its Game in Healthcare Wearables - Acquires Fitbit
Abstract Case Intro 1 Case Intro 2 Excerpts


A Note on Google

In 1996, Larry Page (Page) and Sergey Brin (Brin), students of Stanford University, started a project called 'Backrub' to organize internet search results better. The project was started off in a suburban garage. In 1998, Andy Bechtolsheim, co-founder of Sun Microsystems, became the first investor to invest US$100,000 in the project. Backed by a few more investors, Page and Brin renamed the project Google, bought the domain, and officially incorporated it in September 1998. The company continued to attract more investors year after year. In 1999, Google received funding of US$25 million from venture capital firms Kleiner Perkins Caufield & Byers and Sequoia Capital.......

A Note on Fitbit

Fitbit was founded by James Park and Eric Friedman in March 2007 as Healthy Metrics Research, Inc. The company had its headquarters at San Francisco, California, USA. Fitbit was involved in the manufacture of products that catered to health and fitness. The range of products from Fitbit included activity trackers, heart rate and sleep monitors, and smart watches. Fitbit had gone in for various acquisitions since its inception, it had acquired Fitstar, a company into health and fitness apps in 2015, a smart credit card organization in 2016, a smart watch startup based in Romania in 2017, and a software startup 'Twine Health' in 2018....

Google's Acquisition of Fitbit Creates Ripples

There was a surge in the stock price of Google’s parent company ‘Alphabet’ on the day the acquisition of Fitbit by Google was announced. In fact, analysts were expecting the acquisition announcement given the fact that rumors were rife that Google was planning to launch a smart watch to compete with the Apple Watch. Fitbit’s share value increased by 16 percent after the deal was announced...

The Road Ahead

The future of the healthcare wearables and its applications for customers were summed up by Ubrani, "Health is now at the forefront for these devices since companies have started providing actionable insights and prescriptive measures for end users."......


Exhibit I: Latest Smart Watches and their Features
Exhibit II: Key Financials of Alphabet Inc. from 2015 to 2018 (In US$ Billions)
Exhibit III: Number of Acquisitions made by Google from 2004 to 2019
Exhibit IV: Number of Corporate Venture Investments made by Google from 2004 to 2019
Exhibit V: Acquisitions by Fitbit from 2015 to 2019
Exhibit VI: Key Financials of Fitbit from 2014 to 2018 (In US$)

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