Misfit Wearables cofounder and CEO Sonny Vu learned a valuable lesson at his last company, AgaMatrix. The mobile health startup produced a blood glucose meter called the iBGStar, which allows users to check, monitor and share their readings on their iPhones. With only a glucose strip and the iPhone plug-in, users could track and analyze their health data over time, and even share it with their doctors, without having to keep a record or carry around a dedicated blood glucose meter.
“If you can reduce technology from people’s lives, make it invisible, we could end up with a much more delightful experience,” Vu says. “I don’t think people like technology itself. They like the functionality. They’ll put up with wearing electronics. But they don’t do it because it’s fun.”
As Vu and his AgaMatrix cofounder Sridhar Iyengar started thinking about what to take on next, they realized that in the post-PC era, the next big thing is computation and sensors on the body. But the products already on the market involved annoying logistics, like chest straps and wristbands.
“The problem we saw immediately is all these products [are] not that wearable,” Vu says. “They’re usually made of plastic, when you wouldn’t normally wear it. It made people look like cyborgs, and I don’t think people like that. So that was it.”
Vu, Iyengar and John Sculley, former CEO of Apple, founded the company on Oct. 5, 2011, the day that Steve Jobs died.
They put “misfit” in the name as a tribute to the legendary CEO, a reference to the iconic Apple commercial with the words, “Here’s to the crazy ones. The misfits. The rebels.”
“It wasn’t by design,” Vu says. “It just happened.”
Initially, the three cofounders bootstrapped the company, but six months later they closed a series A round of $7.6 million funded by Khosla Ventures and Founders Fund. But despite the money, the founders decided to crowd-source funding for their first product, an activity tracker called the Misfit Shine, on Indiegogo.
“People ask why. ‘You guys raised enough money. You don’t need it for production.’ The answer is yes, true. We wanted to do it mainly to get consumer validation.”
Part of the reason, Vu points out, is that activity trackers are basically just pedometers. The concept isn’t new. The question was whether consumers would be willing to pay $100 for a type of product that’s been on the market for decades. Sure, products like the Nike+ FuelBand and the Fitbit were already testing the concept with hefty price tags, but Misfit Wearables wanted to be sure consumers were willing to pony up for their design, a quarter-sized metal disc made from aircraft-grade aluminum with only a small display of lights.
They were.
The cofounders’ goal was to raise $100,000 in 30 days. They reached it in 10 hours. The deadline was extended by more than a month (to Jan. 16), and they’ve raised more than $570,000, essentially financing orders of a product that won’t even ship until March.
“We preordered 5,000 units,” Vu says. “We thought that would last between now and March. But fortunately those 5,000 sold out in the first 10 days. We are doubling our preorder and I have a feeling will have to quadruple at this rate.”
Vu thinks the company has taken more than 5,067 unique orders.
“It’s awesome, “ he says. “We don’t’ have a marketing budget. We have no PR firm. We have 570,000 views of our YouTube video. It seems to have caught people’s attention.”
Vu attributes the success of the campaign to the product’s design. Like other activity trackers on the market, the Shine measures distance traveled, vigorousness of activity, and
