Nest CEO and founder Tony Fadell surprised the tech world last week when he announced plans to leave the smart home company and take a new advisory role at Alphabet, the parent company that also owns Google. Now a new report reveals it may have been that exact corporate structure which led to Fadell’s move.
The Verge explained that Google’s decision to establish Alphabet, an umbrella company, last August put new financial pressure on Nest. When the startup was originally acquired by Google, it was promised a long runway to innovate without needing to worry about profits. But, all of a sudden, Fadell and his team became a separate company, pushing him into a more managerial position.
Fadell still struggled with the decision. He deliberated over his next move for weeks before telling Alphabet CEO and Google co-founder Larry Page his plans back in December. Fadell shifted his focus to investing in startups. He has money in over 100 different companies, including one that makes smart go-karts.
“I want to leverage everything I’ve done and the expertise that I have,” Fadell told The Verge. “It’s not that I can do everything myself anymore. There are great innovations, and I want to help those innovations come to light, to really change the world in a great way. That’s what it’s really all about.”
As for Nest, it’s still in the capable hands of co-founder Matt Rogers and tech industry veteran Marwan Fawaz. The company claims to have new products launching soon, even without Fadell’s help.