Rizvi Traverse to Lead $250 Million Investment in Jawbone at $3.3 Billion Valuation
Jawbone, the maker of innovative consumer electronic devices such as the activity-tracking Up wristband, is poised to complete a new $250 million round of funding that values the company at $3.3 billion …
Context & Ripple Effects
Jawbone's fundraising has scaled fast: after a $40 million round from Kleiner Perkins and Deutsche Telekom in December 2011, Re/code reports the company is now poised to close $250 million led by Rizvi Traverse at a $3.3 billion valuation — though the deal remains unconfirmed, with sources describing it as imminent rather than signed.
The pickup was unusually broad for a single-source funding report: CITEworld, VatorNews, Mashable, Computerworld, StrictlyVC, Venture Capital Dispatch, Gigaom and TechCrunch all ran the story within about a day, reflecting how closely the market is tracking late-stage money flowing into consumer-hardware makers like the company behind the Up activity-tracking wristband.
First-order effects
- If completed, Jawbone converts its 2011-era $40 million raise into a $250 million war chest at a $3.3 billion valuation, giving the Up wristband maker extended runway without going public.
- Rizvi Traverse takes the lead investor position in one of the largest private rounds in consumer hardware, displacing the earlier strategic-and-venture syndicate of Kleiner Perkins and Deutsche Telekom.
Second-order effects
- A $3.3 billion mark set largely on the strength of the Up product line raises the pricing bar for any rival wearable maker raising late-stage capital, forcing competing investors to either match the valuation or cede deals.
- Growth-stage funds chasing this round deepen competition for consumer-hardware assets, pushing allocation decisions toward bigger checks into fewer companies.
Third-order effects
- If the pattern holds, large private checks at multibillion-dollar marks become the standard way consumer-device companies fund hardware cycles, deferring IPOs and leaving valuations set by a small group of late-stage firms rather than public markets.
The trend: Late-stage private capital is increasingly setting billion-dollar valuations for consumer hardware companies, extending their private runways well beyond the traditional venture timeline.