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Jawbone Raises $49 Million from Andreessen Horowitz to Dominate Your Mobile Accessory World

March 16th, 2011 03:59 admin Leave a comment Go to comments

Jawbone, the company most known for the headsets seen on the terminally hip kid to your left, has raised $49 million from Andreessen Horowitz to continue to build new devices to take advantage of the smart phone/mobile Web boom. Marc Andreessen and Ben Horowitz invested in Jawbone as angel investors back in 2007, and CEO Hosain Rahman credits Horowitz as one of his most important mentors. Finally, he’ll be on Jawbone’s board.

This round brings Jawbone’s capital raised to date to just under $100 million. That’s a lot of money. But I’m actually surprised they hadn’t raised more. The biggest reason VCs give for not backing more consumer electronics companies is how capital intensive they are, compared to lean and mean Web companies. But getting to a point where you sell 10 million devices in three years doesn’t sound capital intensive– especially when you consider the mega rounds it’s taking to scale the biggest consumer Web names.

Part of that is discipline. Rahman can’t promise investors some wild yet-to-be-discovered business plan. He simply has to make great devices that people buy for more than it costs to make them. And China has been indispensable in making that happen, he says. He’s far from alarmists who worry about the threat of those cheap China goods encroaching on American innovation. “We couldn’t have done this without the ability to do business over there,” Rahman says. “The difference between China now and when we first started going over there in 2002 is amazing in terms of craftsmanship and attention to detail.”

That will be especially important as Jawbone continues to rapidly get new products to market as the smartphone boom takes off, enabling the digital lifestyle of a new generation of road warriors and bored Asian kids sitting in traffic. Last year’s Jambox speaker has sold better on a relative basis than any device and it’s also making a creepy sounding new product called Thoughts that combined audio Tweeting and Blackberry messenger. (This may not sound that exciting to an iPhone generation, but I’m writing this from Indonesia where this is like peanut butter and chocolate– a combination of their two favorite things.)

We’ve invited Rahman to keynote our Disrupt conference in Beijing next fall to talk more about how Web companies between Silicon Valley and China can benefit from the same win-win cooperation between hardware companies in the two countries. Feel free to apply more public pressure in the comments.

Source: Jawbone Raises $49 Million from Andreessen Horowitz to Dominate Your Mobile Accessory World

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