Brilliantly simple idea. Huge success in a market that didn’t exist before. Emergence of competitors. Backlog. Bankruptcy. Total – 35 years. This is the shortest possible way to tell the story of the American company iRobot. Before the appearance of her Roomba, no one even imagined what vacuum cleaners would look like.
Almost everyone has one at home now, and it looks like the iRobot models – but it’s probably a different brand and much better.
The end of an era: iRobot goes bankrupt
The company behind the cult vacuum cleaners Roomba is likely to go into Chinese hands
In the beginning it was MIT… and the army
The story of iRobot began in the 1980s, when MIT scientist Rodney Brooks began making plans to turn robotics research into a successful business. Together with Helen Greiner and Colin Engle in 1990, he founded the company IS Robotics.
It was later renamed iRobot, with Engle as CEO during its strongest years.
Initially, the business had nothing to do with apartment cleaning. The company’s first major project is the PackBot series of specialized robots, the development of which was funded by the US Department of Defense.
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These are machines that defuse bombs, scout and take measurements after chemical and radiation accidents around the world. They were used after Fukushima and 9/11.
A product of the future
The big commercial breakthrough came in September 2002, when the first generation of the Roomba robot vacuum cleaner was introduced. In a year and a half of it, a million units were sold.
Investors are coming. The Carlyle Group poured in $38 million even before the stock market debut, followed by a successful NASDAQ IPO in 2005 with over $103 million raised – let’s not forget that this was 20 years ago and multi-billion dollar debuts are still science fiction.
Source: GettyImages
Colin Engle and Helen Greiner
Roomba is very quickly going from an exotic gadget to an invaluable helper in increasingly busy households. The “Rumba” became a byword for the robotic vacuum cleaner and in many cases was the first contact of users with the very concept of the smart home.
Source: GettyImages
iRobot appears to be a steadfast leader, buying other companies and even funding startups. The military business was sold profitably in 2016 with the idea of focusing all efforts on consumer devices.
Fatal mistakes
Initially, Roomba vacuum cleaners had virtually no navigation. They rely on a seemingly random motion algorithm and sensors to navigate the premises without saving their maps. This doesn’t make them incredibly efficient, but in the absence of competition, it’s not a huge problem.
Later, iRobot created a navigation system. It is based on a camera, and after several generations towards the end of the 10 years, vacuum cleaners can clean a specific room in the home and orient themselves where they are. The problem is that competition is already on the horizon.
Source: GettyImages
Models such as the Xiaomi Mi robot and the related to the Chinese electronics giant Roborock rely on lidar-based sensors that work much more precisely even in complete darkness. iRobot’s response is to try to improve the system with cameras, but paradoxically the results are deteriorating and increasingly the robots are unable to even return to their feature-packed docking stations.
This is unacceptable when the American brand has higher prices than the Chinese brands. Thus, better navigation and additional functionalities for less money attract many ex-Roomba users and the market share starts to drop dangerously.
An additional problem is created by the fact that the robots inherited from the MIT laboratories should be as repairable as possible. iRobot offers all kinds of spare parts, even for very old models, but in fact the demand is not high enough, and the need for everything to be replaced makes the design more expensive and further inflates the final price.
Instead of salvation – an abyss
In August 2022, the prince appeared on a white horse in the form of a bid to acquire iRobot from Amazon for $1.7 billion. As you might expect, a deal for (still) one of the largest makers of smart home appliances and (still) the world’s leading e-commerce platform is attracting the attention of regulators.
Those in the US and especially those in the European Union have made it clear that they have concerns that Amazon and iRobot will “close” the market to competitors. In July 2023, Amazon lowered the price to $1.42 billion, and iRobot had to take out a $200 million loan to avoid bankruptcy even then.
The manufacturer of the cult vacuum cleaners Roomba is on the verge of bankruptcy
iRobot is being suffocated by competition from cheap Chinese brands
In the end, at the beginning of last year, the deal finally fell through. Amazon pays $94 million to iRobot, but it doesn’t solve any problems – 31% of employees are laid off, Colin Engle leaves, and development activity practically stops.
In Chinese hands
The company that filed for bankruptcy earlier this week might be called iRobot, but it didn’t have much of the home robot pioneer’s original spirit left.
Nobody wants to buy iRobot, and the stock has crashed
The maker of Roomba vacuum cleaners has dropped in price by about a third
It used to put its logo on inconspicuous vacuum cleaners made by China’s Picea, which is now likely to just acquire the legendary brand for nothing as it is among the major creditors.
Picea is also known as 3iRobotix. It makes home robots for a whole bunch of companies, including Xiaomi. We recently told you about an Indian engineer’s attempts to combat a vacuum cleaner based on its own hardware that crashes the moment it is prohibited from sending a huge amount of unknown data to a remote server…
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Either way, iRobot will continue to exist in some form, but Roomba’s strong years are long behind it.
