AAA Jawbone bites down on $300m

Jawbone bites down on $300m

Jawbone, the US-based wearable technology maker backed by telecommunications firm Deutsche Telekom, has received $300m in funding from asset manager BlackRock, Re/Code has reported.

Founded in 1999, Jawbone produces wearable products and is best known for manufacturing portable speakers and fitness trackers that are worn on the wrists.

The funding was revealed as Jawbone launched a new activity tracker, the Up3, and announced a deal with payment services firm American Express to jointly develop a new tracker, the Up4, that can also be used for payments.

The investment valued Jawbone at about $3bn, sources told Re/Code. Reports in September last year suggested it had raised the first $15.8m of a $250m round featuring Ritzi Traverse that would value it at $3.3bn, but it is unclear whether BlackRock’s investment constitutes the same round.

Jawbone raised $93m in debt from Silver Lake, Fortress Investment Group, J.P. Morgan and Wells Fargo in 2013 together with $20m from existing backers including Andreessen Horowitz, Kleiner Perkins Caufield & Byers (KPCB), Khosla Ventures and Sequoia Capital, taking its overall equity funding to approximately $227m according to regulatory filings and press reports.

Deutsche Telekom invested in a $40m round in 2011 alongside KPCB and Yuri Milner.

BlackRock’s investment comes at an opportune time for Jawbone, which has reportedly been having trouble paying its bills in recent months as larger technology companies such as Apple and Samsung are investing more heavily in the wearables market.

Contract manufacturer Flextronics sued the company in August 2014 over a $20m debt, alleging in its suit that “Jawbone’s financial condition is perilous and currently insufficient to pay its debts,” and although the dispute has since been settled, discussion concerning its finances has been rife of late.

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