Nest raising 150M at 2-3B valuation

Jan 2, 2014, 6:25am PST

Smart thermostat maker Nest raising $150M at $2B-$3B valuation

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Bloomberg/Aidan Crawley

Thermostat and smoke detector maker Nest Labs, led by CEO Tony Fadell, is reportedly raising between $150 million and $200 million in a new venture funding round that values that company at more than $2 billion.

Cromwell Schubarth

Senior Technology Reporter- Silicon Valley Business Journal

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Nest Labs, the smart home device maker, is reportedly raising between $150 million and $200 million, placing the company's valuation somewhere between $2 billion and $3 billion.
The funding of the Palo Alto company, founded and led by Apple veteran Tony Faddell, was reported Thursday by Re/code, the new online site started by former All Things Digital staffers.
The report cited unnamed sources who said several investors were competing for the deal that appears to have been won by Yuri Milner's DST Global investment firm. The sources said that current investors are also involved, including Google Ventures, Shasta Ventures, Kleiner Perkins Caufield & Byers, Generation Investment Management, Lightspeed Venture Partners and Venrock.
The last time Nest raised money, about a year ago, it took in $80 million at a reported valuation of about $800 million.
At the time, it was only selling a sharp-looking smart thermostat that recalled to many the iPods that Faddell worked on while at Apple. Late last year, Nest added a combination smoke/carbon monoxide detector to its product line.
Faddell's young company will probably need all the new funding it can raise: Not only is it competing in the hardware end of technology —which is more expensive than developing new software products — it is also embroiled in a patent battle with Honeywell.
And Apple itself has filed for patents that appear to indicate that it could get into the smart home space that Nest is developing.
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Cromwell Schubarth is the Senior Technology Reporter at the Business Journal. His phone number is 408.299.1823.

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