Tony Fadell leaves Nest

Tony Fadell is leaving Nest. The former Apple executive, who co-founded the company in 2010, announced his departure on the Nest blog. Fadell will continue to serve in an advisory role to Alphabet CEO Larry Page. Marwan Fawaz, a former executive vice president at Motorola Mobility, is joining Nest as its new CEO. 

In a statement, Larry Page said:

Under Tony’s leadership, Nest has catapulted the connected home into the mainstream, secured leadership positions for each of its products, and grown its revenue in excess of 50% year over year since they began shipping products. He’s a true visionary and I look forward to continuing to work with him in his new role as advisor to Alphabet. I’m delighted that Marwan will be the new Nest CEO and am confident in his ability to deepen Nest’s partnerships, expand within enterprise channels, and bring Nest products to even more homes.

In the Nest blog, as well as in an interview with The New York Times, Fadell is positioning the decision to leave the company has his choice. To the Times, he said, "I’m a guy who’s at the beginning of things. I don’t like to do maintenance mode. It’s not what gets me out of bed."

In his departure post, Fadell writes that "this transition has been in progress since late last year."

That may be true, but Fadell's departure comes just two months after reports of struggles within Nest were published by The Information and Recode. The reports painted a portrait of a company mired with a toxic culture (led by Fadell) and with problems actually getting products to the finish line.

Greg Duffy, who co-founded Dropcam (a company Nest acquired in 2014), has been particularly critical of Fadell and his leadership at Nest. Duffy left Nest in early 2015.

In an interview with Bloomberg discussing his departure, Fadell waves off some of that criticism. He says that the team's response was "it’s been a shock, like, 'What? This doesn’t reflect our culture. This isn’t about us.' And then, you know what happens? It galvanized our team. It made them stronger."

And although he admits he does wish Nest could ship more products, he defends the products the company has shipped. 

People will say, "Oh, oh, oh, they didn’t ship enough product." Well, guess what? We have shipped product. We shipped a lot of product. We shipped a lot of software. Oh, they’re going to say, "This business isn’t healthy." Well, guess what? We have great revenues and great growth on the business. So, okay, what potshots do you want to take? "The products aren’t well regarded." Well, we have more than four stars on all our products.

In the Bloomberg interview, Fadell also addresses the reports over his management style, which many (including Duffy), felt to be abrasive.

Fadell says "you can't make an omelet without braking eggs" and admits his style "may not be for everyone," but he stresses that he's been in the Valley for 25 years without a tyrannical reputation following him around.

From iPod to thermostats

Before founding Nest, Fadell was known as one of the creators of the iPod. He left Apple in 2008 and co-founded Nest with another Apple engineer in 2010. The company's first product, the Nest thermostat, was a huge success and was one of the first tech products that seemed like a fully realized idea of what the Internet of things/home automation space could be.

Google (now Alphabet) acquired Nest in 2014 for $3.2 billion in cash. When Google became Alphabet last year, Nest was named its own subsidiary, separate from Google.

Although Nest is one of the marquee companies in the Internet of Things/smarthome space, it has struggled in recent years to keep up with its competitors. The company hasn't released a wholly new product in years. According to numerous reports, a smarthome hub designed by Nest has been delayed time and time again. 

At the same time, Amazon has managed to enter the connected device space with its product, the Amazon Echo to great success. 

At Google I/O last month, the company unveiled its answer to the Amazon Echo: Google Home. But Google didn't use Nest to design the product, it was built in-house.

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