Educational robotic toymaker Sphero acquires littleBits, a maker of electronics building kits and instructional resources for kids
When Sphero laid off 45 employees in early 2018, the Boulder, Co.-based company explained the difficult decision as an effort to return its focus …
Context & Ripple Effects
This acquisition is the third act of Sphero's pivot away from consumer toy robots. After laying off 45 employees in early 2018 following a disappointing holiday season, the company raised $12M toward a planned $20M round explicitly to shift toward education, then picked up the Specdrums music-ring startup that summer.
Buying littleBits adds electronics building kits and instructional resources to a catalog that until now centered on robots and accessories — deepening Sphero's classroom offering just as its restructuring settles in. It matters because it converts a cost-cutting retreat from toys into a build-out of an adjacent market.
First-order effects
- Sphero's education catalog now spans robots, music accessories, and littleBits' electronics kits, giving school buyers a single vendor for hands-on STEM hardware and instructional resources.
- littleBits' standalone operations fold into the Boulder company, which is still integrating acquisitions like Specdrums on a restructuring-era balance sheet.
Second-order effects
- Rivals selling electronics and robotics kits to schools now face a competitor bundling multiple product lines under one brand, pressuring them toward their own acquisitions or bundles.
- The education focus that justified the 2018 layoffs and funding round becomes the lens for future portfolio decisions, as later seen when Sphero named Paul Copioli CEO and spun off Company Six for first-responder robotics.
Third-order effects
- If the pattern holds, toy robotics companies consolidate around education as the durable revenue base, with consumer products demoted and corporate structure — spinoffs, acquisitions — reorganized around institutional buyers.
- The littleBits deal points toward STEM hardware markets consolidating into fewer multi-line platforms, raising the bar for single-category kit makers trying to sell into schools on their own.
The trend: Consumer robotics toymakers are reorganizing around education as their core market, using acquisitions like littleBits to assemble multi-line STEM platforms.