Otto, maker of the $700 smart lock, suspends operations

midian182

Posts: 6,677   +59
Staff member

Back in August, a startup called Otto comprised of former Apple, Microsoft, and Nokia workers, unveiled a stunning-looking smart lock. But the hardware came at a hefty price: $700 for one unit. Now, just over four months later, the company is suspending operations.

The device, which was also called Otto, would have allowed owners one-touch, key-less access to their homes via Bluetooth and a phone app—though there's also the option to enter a PIN number. It features marine-grade 316 stainless steel construction, a backup battery in case the main battery runs dry, and the ability to allow friends and family to enter a home via the app.

Even with all that tech, $700 made it a difficult sell. But according to CEO and ex-Microsoft employee Sam Jadallah, the price wasn’t a factor in Otto’s failure to get its first product to market. In a Medium post titled ‘So Close,’ he explains that it was about to be acquired by an unnamed company and that the deal Otto signed restricted its ability to raise funds. For unexplained reasons, the buyer pulled out of the acquisition on December 11, leaving Otto without the money to continue working.

“To our beta users, pre-order customers, suppliers and partners, I’m so very saddened that we can’t deliver Otto, which was planned for first revenue in just four weeks,” writes Jadallah. “Otto will not ship next month and it may never ship. We will evaluate our options in the coming weeks and see what is open to us.”

While some may wonder if the buyer’s doubts were related to the lock’s restrictive price, Jadallah told TechCrunch this wasn’t the case. In fact, the company buying Otto was convinced it could sell the product for even more than $700 in certain markets. But it seems we may never find out.

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Hmm, w/ all those hi powered connections Otto couldnt borrow some $ ?
Seems they wantd out anyway.
So the lock buyers are stuck w/ a $700 + obsolescence-bound lock with no recourse?
Maybe sue the co. officers, I bet they have deep pockets.
 
Hmm, w/ all those hi powered connections Otto couldnt borrow some $ ?
Seems they wantd out anyway.
So the lock buyers are stuck w/ a $700 + obsolescence-bound lock with no recourse?
Maybe sue the co. officers, I bet they have deep pockets.

Uh. Like, did you read the article? Nothing was produced, nothing was shipped. There were no buyers. Only pre-orders. Hopefully they get their money back, but usually there's a clause they agree to where they take the risk.
 

Theinsanegamer

Posts: 2,402   +3,492
If the fish smell was any stronger, we'd be at sea. Or in a sewer in Florida.

If the device was so successful with beta testers, why did their buyer back out? Why couldnt they find investors? Why did they need a buyer in the first place when so many other companies only need VC to succeed?

And most importantly, why on earth did they not have a 'we get paid if you back out of this acquisition' clause in this supposed contract? If any acquisition involves restrictions on revenue, you had better bet such a clause will be present (ask sprint and t mobile how much they made when ATT was forced to back out).

Either this operation was an entire sham to launder money/tech/patents/cookies, or the people involved were utterly incompetent at their jobs, which is probably why they dont work at nokia/MS/google anymore.
 

wiyosaya

Posts: 5,793   +4,000
What they are not telling us: There was some unfixable security hole that allowed anyone to enter.

Also, 316 Stainless sounds like someone had no clue as to why, or even if that material was appropriate for the lock - marketing speak, IMO.
 

stewi0001

Posts: 2,574   +2,167
...Nothing was produced, nothing was shipped. There were no buyers. Only pre-orders. Hopefully they get their money back, but usually there's a clause they agree to where they take the risk.

"...Beta Users..." This could suggest that something was produced but obviously not main stream production.
 

p51d007

Posts: 2,691   +2,029
Nope...can't buy it at a big box, Amazon etc...not getting my money.
Just to be trendy and the first...NOPE I don't play that game.
 

tipstir

Posts: 2,854   +200
I already have a push button lock on my front door, now if I can get it to work again I'll let you know! I have to still use a key to open and close it! LOL
 

captaincranky

Posts: 16,534   +5,332
They should have sent Elon Musk out to hype the damned thing. When he got done with his windy, bullsh!t, imaginings, they would have had deposits on 200,000 Ottos". (Which would have likely not gotten manufactured or delivered either).

SAMPLE: "Why I have so much faith in these locks, I will be supplying them to the colonists I'm sending to Mars, which will happen sometime in the middle of this year".
 
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