THIS COST US $1.7 BILLION

A $1.7 billion acquisition offer was on the table.

Basically, yes, but the FTC said, "No, we're going to block this." But I believe that theright thing usually happens, and theright thing was this deal gets approved. The challenge was our government has a mindset which is incredibly risky and damaging.

There was no legitimate attempt to establish the fact that the three criteria required by the FTC and the European Commission to block a deal were met. It was never about iRobot, it was never about enforcing competitive processes, it was about something else, which was.

Colin Angle is the incredible robotics innovator.

Who started an entire industry, and now he's revealing what he learned from a failed $1.7 billion deal.

And how you can avoid making the same mistakes.

The current Federal Trade Commission believes that all M&A is bad, and it's incredibly misguided. And so the cautionary tale isn't as much for the entrepreneur, but it's for the country. The FTC really should be caretakers of the innovation economy, which is kind of the opposite of what happened with iRobot.

The message that the FTC sent, blocking the transaction between iRobot and Amazon, was, "Big tech's not allowed to buy companies." And the result was an incredible blow and negative message to the innovation economy. On their doors are printed out headlines for the newspaper: "So-and-so deal blocked."

These are the trophies of the FTC. These are the things that the leadership of the FTC celebrate as victories.

What do you do at iRobot that you hope other founders don't make the same mistakes?

You know, I think that.

Colin, it's great to see you.

Happy to be on with you. Thank you for having me.

So this all came about because I came across a TechCrunch article before my flight in December, and I had to reread it because I was like, "Oh my God, what? The iRobot has gone into bankruptcy?" And I really appreciate you coming on the show today because there is so much to unpack, but I can't help think, when that type of article comes out, you have to think of the founder who spent 33 years of his life building the company alongside his co-founders.

When the news broke, who was the first person you called and what did you talk about?

I mean, the journey that led to that moment

was a long journey, and so that it was less a surprise and more, "Okay, now it's time to be able to tell the story about what happened a bit more." Because, you know, the last thing you do want to do when a company is really fighting to move forward is do anything to harm that company that you love so much.

And yet the story about what happened with the acquisition from Amazon being blocked was just so horrific that, honestly, when the news came out, it was a little bit of, "Okay, here's an opportunity to try to turn what was really a miscarriage of

it wasn't what was supposed to happen, and maybe we could turn it into some lessons learned to ensure that

the attitude and policy, which was very much running against the innovation economy, which fuels

the United States' entire economy in a very real way,

this attitude that actually was running counter to productive growth could be brought into the spotlight." And so a little bit of relief, actually. My morning period

was a year and a half ago, personally, and so that wasn't the emotion. When the deal was blocked, that was tough because that was a turning point for the company. It put it in a challenging place. The brave folks that were taking it forward were taking it forward, and at that point, I was like, "Okay, it's time for Colin to do something else."

It's super hard. I can't imagine the morning and the pain that founders go through when they have this type of rollercoaster of a rideright. Did you find out about the bankruptcy the same times we did? Did you know it was coming?

You know, basically, yes. You know, at the point when the bankruptcy was announced,

you know, I was fully disconnected from iRobot. When I stepped down from the board, you know, the challenges it faced the leadership, you know, it was in all of our best interest to say, "Okay, you go this way, I'll go this way, and we'll move on."

And so that allowed me to move on with my world and not having, you know, the co-founder and CEO of 33 years second-guessing everything that was happening inside, which would be miserable for everybody. So I became an outsider and learned like everybody else.

So, you know, it's not the end. Obviously, iRobot continues to fight to move forward, but in a very different set of circumstances, which, frankly, were hardly surprising to me.

Well, you're now back with your new company, which we'll talk about later. Let's talk about the story, story time. You're almost like these, you know, mad professors,right, out of MIT, who didn't just want to create robots, you wanted to create robots and send them to the Moon.

I mean, that's what a mad professor would do. Take us back to those early days. What were you guys up to?

The early days of collaboration with this professor, Rodney Brooks, were magical for me because it was so enlightening. I mean,

you know, I joined this lab called, and Rod called it the AI Lab, but AI didn't stand for artificial intelligence, it stood for artificial insects. And

that sort of pun really underlined

a very profound

philosophy that Rod had. And it was, you know, at the time, everyone was thinking about artificial intelligence as defined by, "Can you play chess?" Where Rod looked at it and said, "Yeah, I'm not sure that'sright. In fact, you know, maybe instead of going this top-down strategy, let's look at bottom-up and let's try to understand how insects work because insects are fantastically successful in doing all these hard things, you know, obstacle avoidance, navigation.

You know, it's amazing what they can do, and yet they don't have supercomputers, they have very limited brains, and maybe this is something that we could understand." You know, and

in keeping with that philosophy, you know, when I joined, I was an undergraduate at the time, and there was a robot, Seymour, that was, you know, omnidirectional base with all this compute and sensing on it, or at least a certain amount.

But he said, "Okay, Colin, your job is to make this robot go through doors." And I thought about that and said, "You know, that's a really hard problem."

Putting an arm on a mobile robot, that hadn't really been done before, much less dexterous manipulation and opening doorknobs. And he's like, "Well, maybe you need to think about this a different way." And so I did the obvious thing.

I built a candy machine and put it on the side of the robot because thinking about the environment, it was the AI lab at MIT, there were students always around, they were always hungry, and, you know, even in the middle of the night.

And so that if I wanted to go through a door, why not just drive up to the door and offer a, you know, a small bar of candy for a graduate student to open the door and let me through?

And, you know, this was, let's think about the problem from the perspective of solving the problem, not from, you know,

all should be humanoid. I mean, it's, you know, it's a very

narrow line of thinking to say, "Okay, I want to open the door, well, thus I must have an arm with a hand on it to grab and open it like a person would." And so that this sort of understand the problem and then use robotics instead of as a thing, use it as a tool to solve the problems that you're given, led to, you know, a host of very interesting ideas.

And the, you know, you asked about space exploration. At the time, NASA was building massive rovers. I think the lunar rover project, maybe it was a Mars rover project, at the time was a 2,000 kilogram, you know, robot the size of a Humvee.

And why did it need to be that size? Well, it needed to go over half-meter rocks, and so the wheels needed to be more than twice the size in diameter so it could go over these rocks. And, you know, there didn't even exist a launch vehicle to get this bus to its destination.

And so that was like, "Well,

this isn't a good idea. We need to be thinking about rovers at a completely different scale." And, you know, Rod and some of his collaborators wrote this paper called Fast, Cheap, and Out of Control: A Robot Invasion of the Solar System, which hypothesized using micro rovers, really teeny tiny rovers, to explore other planets in very clever ways.

I mean, the most bizarre would be a swarm of little sort of cockroach-like robots that would disperse across the planet. And if they were found anything cool, they would just lie on their backs and their backs would be little mirrors.

And so that you could go shoot a laser and scan the Moon or scan Mars with a laser. And wherever there were bright spots, there were things of interest. And depending how these little cockroach robots would, you know, and so it was a very innovative

paper thinking about all sorts of different ways of doing it. And sort of coincident with that line of thinking, I had built a legged robot with just two legs. And he said, "Okay, let's make this something real." And, you know, there's a lot of work on sort of these top-down intelligence driving massive legged robots.

And let's go build an actual insect. And that led to a teeny robot called Genghis. Cool thing about legged robots, they can climb over things bigger than their height. And so that if you want to climb over rough terrain, legs can work really well.

And it worked, and it ran on 256 bytes of RAM as opposed to, that's bytes, not even kilobytes, with this incredibly efficient AI system

that allowed us to endow machines with very small, affordable compute, the beginnings of real artificial intelligence. And, you know, that robot went on to

really be a central demonstration of

an approach to AI and robotics, which has, you know, until recently been the default strategy called behavior control. The robot ended up in the Smithsonian, and I got into grad school, and we decided, "Hey, this collaboration works pretty well."

Let's ultimately, it led to starting of iRobot.

It's incredible. And, you know, what's amazing about the whole story, 33 years you guys, you know, ran the company, but it actually took you 12 years to actually, you know, get the Roomba to market.

Yeah.

What was the initial idea for the Roomba? And, you know, how did you just, you know, take us back to those early first years? What was happening?

So, you know, the, "Okay, we're going to start a company, and we have a technology, this behavior control and this AI architecture," but we didn't have an application. You know, we actually built a second-generation Genghis robot, which we, you know, with this idea of supporting space exploration.

And, you know, it was actually quite successful. It didn't ultimately fly, but, you know, we did tests out at Edwards Air Force Base. We showed the world that you could do exploration and you could land a micro rover.

That project got taken over by NASA and led

in a pretty straightforward trajectory to the adding of the Sojourner rover to the Measure Pathfinder mission and my mountains up on Mars. And that's all cool, but that didn't really drive the economic fortunes of iRobot. You know, we did a lot of other things during that time as well.

We worked with

Johnson Wax on industrial cleaning robots. They were looking at ways of cleaning supermarkets and malls with robots. We worked with the U.S. government on mine-hunting robots to, you know, obviously, hunting for mines is terribly dangerous and challenging

thing for a human to do. And so that we said, "Okay, this is a good application for robots." And we even worked with Hasbro to build robot toys. So we built a baby doll that was interactive and could tell how it was played with.

And the bizarre thing, and then so that we were doing a lot of different explorations into the applications of robotic technology. The Roomba,

when it launched, it combined all of these different experiences. The cleaning mechanism came out of the experience with Johnson Wax making industrial cleaning devices. The navigation system for Roomba was actually a mine-hunting algorithm that we had developed,right? So that the early Roombas, when it went out into your room and tried to go and find all the dirt, it was actually running a mine-hunting algorithm to ensure good coverage.

The fact that we were able to make a robot at all at a price point that

consumers could actually afford came from our working with Hasbro on robot toys. We learned how to make robots out of injection-molded plastic and tap into the whole consumer product ecosystem. And so that it was this bizarre convergence of ridiculously disparate applications.

We love ads.

Coming together to create something that, frankly, people had been telling us, "Hey, Colin, when are you going to clean my floor? When are you going to, you know, I'm Rosie from, I want Rosie from the Jetsons." It's like, "No, you want a clean floor."

And the craziest thing is to imagine a humanoid pushing an upright vacuum cleaner.

But if you want a robot to clean your floor, we could bring together this navigation technology, this low-cost technology, this cleaning technology, and actually create a solution. And it took 12 years to go through those phases of learning where, you know, each one of these partnerships led to iRobot sort of holding at the end of the collaboration insights into how to navigate, how to build robots at a lower cost, how to go and actually do things like effectively clean.

And suddenly, Roomba became possible

until we did it. And that's.

I love how, I love how kind of, you know, that whole mishmash kind of like comes together,right? From the experience of, you know, setting kids' toys, the navigation, the pricing, and just trying to get this thing to market,right?

And the growth, you know, when you guys initially launched, the growth kind of went a bit bananas,right? I mean, you sold something like 300,000 of these products in the first few months.

Well, it was

definitely unexpected. So we launched this robot in September of

2002. And I remember arguing with my board of directors, like, "Can we build 10,000?" It's like, "That's a lot of robots. You know, how are you going to sell it?" It's like, "No, no, this is really good." And the, you know, we didn't really have a marketing budget because we were a little startup.

And the, but the press latched onto it. You know, it was really the, what was magical was the fact that the press liked iRobot because we actually had things that moved. So robots were of interest.

But, you know, with all these sort of top-down giant multi-million dollar things, you know, you go there and you say, "Okay, look at my robot." It's like, "Does it move now?" But it will eventually. Where you came to iRobot and, you know, we were like the insect guys.

We were, we always had little things moving around everywhere. It was really interesting.

So the, but I never had anything to sell until Roomba. So when Roomba came out, it's like, "Okay, finally, finally, after all this time, I have something to sell. So come on and let me show you." And it's like, "Well, what is it?"

It's like a robot vacuum. And it was, "Well, that can't possibly work." It's like, "No, no, it does." And so I would meet with these guys and, you know, it's like, "Okay, show me this robot." And they thought, "Okay, this is an interesting story because people can appreciate the application of robots."

And they'd look at it and, you know, and their first question was, "Okay, it's small. Is it, I don't know. Colin, does this really work?" And for years, I would walk around with a little baggie of Cheerios in my back pocket because people would all say, "Well, does that really work?"

And I would, so I, just like a classic vacuum cleaner salesman,right, from yesteryear, I pulled out my little baggie of Cheerios and sprinkled Cheerios on the ground and then stomped on them and started grinding them into their carpet in their beautiful conference room, at which case I had their attention,right, because I just ground Cheerios into their floor.

And it's like, "Yeah, it really works." And I put it on the Cheerios and it'd go around and do its thing and it would clean them up and they would go from being completely skeptical to, "Oh my God, this actually is working."

Now I know something that the rest of the world can't possibly believe is true, that robot vacuum could actually be here. And

at launch of Roomba, we had well over 100 top-tier media articles written about the product, you know, USA Today, Time Magazine, the Wall Street Journal. You know, it was just like insanely wonderful, the press coverage. And we sold 70,000 Roombas in the first three months.

And then we went through the next year where things almost completely died

until another bizarre, you know, if you'll indulge me to tell you another earlier.

Is this the Pepsi story?

The Pepsi story, yeah.

Yeah. Yeah, this teller is pretty fascinating.

So, you know, so we had this huge start fueled by PR. And then once the holiday season was over, sales, you know, we said, "Okay, well, what do we build for the next year?" Well, we sold 70,000 in the fourth quarter of 2002.

Let's multiply that by four, add a little bit. We're going to sell 300,000 robots next year. It's going to be great. And we were sitting there at the end after Black Friday, after Cyber Monday of 2003, with 250,000 robots still in the warehouse and terrified that it was all going to come to an abrupt end.

We had even made a commercial which didn't work at all. And what happened to save us was Pepsi put out a commercial where they had a celebrity, Dave Chappelle, the comedian, walk into a house. You know, it's a beautiful house and there's a lovely table and there's chips and Pepsi on the table.

And he picks up a chip and a Roomba comes out. And he looks down and he says, "Oh, a vacuum." So he called it a vacuum, which was like awesome. And he threw the chip down and the vacuum, the Roomba came and sucked up the vacuum, sorry, sucked up the chip, and then had put a big eye on the robot and spotted it and spotted the fact he had a Pepsi and started chasing around the house.

And there's a cut scene and he's knocked onto his back and his pants are ripped off. He stands up, a beautiful woman appears and he says, "Your vacuum cleaner ate my pants. There was nothing I could do."

And we sold 250,000 robots in the

six weeks following that TV commercial. And we learned about storytelling. We learned that engineers make lousy commercials. We learned that we needed to make technology more accessible in our storytelling.

And that really was the turning point where we went from

a press-darling launch to a sustainable marketing campaign backed up by the product to go drive Roomba into the daily conversation as a legitimate tool for cleaning your home.

That's crazy. When I saw the story, I was like, this is like a bit of fuke,right? And I think you mentioned that in one of your interviews, every founder goes through those really bad days and many bad days, but they just have a few days of luck here and there.

And I actually remember these types of vacuums, you know, coming out. I was only seven, eight years old. I'm 28 now. So this was about,right, 20 years ago. And all of a sudden then you start seeing copycats emerge, which is probably the founder's worst nightmare.

So you had two of these Chinese copycats,right, who came along. When did you start to hear about them and did it begin as a big cage vice or just a small one?

One of the luckiest things that iRobot did was choose a really hard problem. And so that when the copycats started coming out and copycat robots came out starting 18 months after launch was when we first started to see

sort of inexpensive Chinese knockoffs coming to market. But they were terrible. And

over the next

17 years, nearly every consumer product company on the planet tried to create a knockoff Roomba. All of the big consumer brands tried. All of the, you know, the fast-moving Chinese factories tried. And, you know, I remember a story when one, you know, very famous vacuum cleaning manufacturer launched a competitive product and they bragged how they had spent, you know, $45 million in 12 years developing their autonomous robotic vacuum cleaner.

And that's an immense amount of money for a consumer product company to spend on one product. But we kind of laughed because

robots are hard. And this was all iRobot did. And we had spent $65 million in R&D the prior year.

So that Roomba broke the model for what consumer product companies could really afford to, you know, to develop on their own. And, you know, it allowed us to maintain technology leadership for a long time. And competition really didn't become relevant until an entire ecosystem

on robot technology started to emerge. So you had companies that said, "I'm selling a robot navigation system. You know, I'm selling a robot range finder. I'm selling a robot cleaning mechanism." And so that you could hang a shingle and say, "Okay, I want this, this, and this."

And suddenly you started to have a robot that could actually work

with

a radically shorter development time and much less investment than what a roll-at-your-own-from-scratch strategy could succeed at. And so that took

17 years to develop because it was hard. But once the ecosystem had been created, you started to see more legitimate product coming out of China. And that's when competition became more intense and, you know, innovative features. And there's lots of things we didright and lots of things we did wrong along our journey

that led to a little more vulnerability in the company when there were some various macroeconomic downturns and

sort of global events and COVID that made it more difficult for iRobot to sustain that investment, that differentially investment in innovation when compared to what some of the other companies were putting in. And the gap started to narrow.

And that's when

it started becoming apparent that maybe being part of a larger entity with a strategic focus on the smart home might make sense.

So this is when Amazon comes knocking.

Yes. So that, yeah, we wouldn't get there when you want to. But this idea that, you know, we did successfully lead the market for, you know, more than a decade and a half, it boiled down to solving a hard problem and continuing to invest in innovation that allowed us to maintain that leadership for that period of time, which again is a rare thing and absolutely critical for a startup company that is, you know, trying to go and break out from being sort of interesting to small to relevant.

And as a result of being able to maintain that leadership, we now have a robot vacuuming industry and

that didn't exist back when iRobot started. And that's pretty cool to say, "Okay, we did this and now we have a new industry."

There's something quite cool about the Ukrainian product and then all of these copycats come along. So in a good way, it's a good sign,right? Because it obviously proves there is something. But on the flip side, it means you've got to fend off the competition,right?

And one of the ways to do that potentially is to partner with a much larger company. And the reason why I wanted to invite you on today's show is not only is, you know, the iRobot story so awesome and, you know, just running a company for so long, but I think it's a cautionary tale for founders who want to partner with another company, what to doright and maybe some of the lessons learned.

So let's talk about this acquisition. Amazon and

iRobot. So just for context for the viewers, a $1.7 billion acquisition offer was on the table, but the lovely U.S. government and the European government decided to block it. How did this acquisition first come about?

So good acquisitions happen when there is strong strategic alignment in the vision between the company being acquired and the acquiring company and, you know, a good cultural fit and mutual respect. And all of those things were present. I mean, again, the relations that I had and iRobot had with Amazon

went back many, many years. You know, from the

earliest days of Alexa, I think when Amazon was looking at what are people going to use Alexa for? One of the top early things was they're going to use it to control Roomba. And because we want to talk to our robots.

And Roomba was the official, you know, it's the only consumer robot that anyone knew about at the time. And so that, you know, the collaboration and conversation and, you know, we probably had the most elaborate Alexa skill of any consumer electronic device.

You know, and so that

we understood each other and understood that together we could do something special.

And so you talk about acquisition and working with big companies from a cautionary tale.

I have nothing but positive things to say about the process

and the, you know, the shared vision of what was going to be created. The challenge was

that the current Federal Trade Commission

believes that M&A, all M&A, is bad, which is just a ridiculous position. And, you know, it seems like if they had their druthers, they would stop every M&A deal. And this is publicly stated and this is a philosophy of some of the leadership.

And it's incredibly misguided.

You know, yes, there are issues with monopolistic behavior. I'm not saying that they're not. The FTC needs to play an important role choosing between good and bad. But the FTC really should be caretakers of the innovation economy and doing their best to bring choice and advancement to the consumer, which is kind of the opposite of the outcome of what happened with iRobot.

And so the cautionary tale

isn't as much for the entrepreneur, but it's for the country that our government is actively has a mindset which is incredibly risky and damaging to the innovation economy because, I mean, just it's pretty straightforward. IPO is not the primary exit for the entrepreneur.

That is the exception, not the rule. Nearly all of the exits that happen when you decide, like I did, to hang a shingle outside your door and start building whatever your dream is in your living room, which I did.

My living room was, you know, where we started, you know, and attract the investment to follow your dreams. The anticipated outcome for the investor is this company is going to get interesting and someone will buy them. The message that the FTC sent blocking the transaction between iRobot and Amazon was big tech's not allowed to buy companies,right?

There was no legitimate attempt to establish the fact that the three criteria required by the FTC and the European Commission to block a deal were met. There's three. The acquiring company needs to be able to create a monopolistic condition.

They need to show that doing so would, they would have an economic motivation for doing so and that if they did, it would work. And of course, Amazon could preferentially advantage iRobot on the Amazon website. It's their fricking website.

But there was no economic advantage to doing so. In fact, it would be ridiculous. It would be detrimental to the store if they did. And it was shown that it wouldn't have mattered. So it was never about iRobot.

It was never about enforcing anti-competitive processes. It was about something else. It was, as far as I can tell, it was about politics. And the result was

an incredibly blow and negative message to the innovation economy. You know, and a real lesson learned that says, "Okay, America, entrepreneurs are not the enemies.

Entrepreneurs are like, I mean, my God, what we went through to actually create iRobot was a sequence of miracles

that are remarkable that they ended up the way they did." You know, we're an example of, "Okay, we created an industry." And then as a result of, you know, and Amazon was a great acquisition partner. And we would have created

an exciting next chapter in the smart home. At least that's what we're going to try to do. Maybe it would have worked, maybe not, who knows. But certainly the consumer would have had more choice and the consumer would have benefited.

You know, the European Commission,right? They blocked the deal. We had 12% market share and falling. And the number one market shareholder was only in the market for three years. That's like the definition of a vibrant, dynamic marketplace. That is, it is not the definition of a monopolistic situation in the marketplace.

And so that this was not about iRobot at all. Something else was going on. And so that, you know, the message

is to the American people and to the government saying, "Be careful what you wish for because you might get it." Right? And when you go and have an all M&A is bad attitude,

what do you really want to have happen with that? Where do you want that to go? Because if you eliminate the primary acquirer of startup tech companies, and that would be large tech companies from the equation, the economics of the venture capital industry are fundamentally changed.

And

I don't really think we want that to happen as a country.

It's not great for founders as well,right? I mean.

Oh, yeah. No, I mean, it means that the founders are going to fail.

Yeah.

They're not going to have access to the capital,right? It all blows down.

Exactly.

Right? It's, you know, the most difficult question I can ask anyone is, "Well, what do you want to have happen?"

Yeah.

Right? Because if you are going to not just block bad M&A, block all M&A, the trickle down is then the VC industry doesn't see the exits and so that the amount of money going into venture drops, the entrepreneurs don't have access and innovation goes down and the drivers of, you know, one of the core drivers of the U.S.

economy is crippled. Now, in the iRobot specific case, we also took an industry that we had led for, you know, 20 plus years, put it in a box and handed it to somebody else.

And somehow that didn't even enter into the equation of the conversation. Or at least it's certainly known what was going to happen, what the likely outcome was because, you know, we spent ridiculous amounts of money telling the regulators what was going to happen if the deal was blocked.

And Amazon spent many, many times what iRobot did to convey that message as clearly and starkly as could be conveyed. And it was ignored. There were other forces at work.

It's crazy, isn't it?

I mean, it's very frustrating. And then we move on,right? I mean, it's like you asked me when the bankruptcy came out, it's like, "Now I can tell this story." And I'm happy to. I hope that we can affect change that keeps the innovation economy driving, you know, global entrepreneurship, but certainly entrepreneurship in the United States to be a vibrant part of our economy because so many wonderful and amazing cool things come out of it.

And, you know, it is kind of core to the American dream. I mean, it's this idea that you can come up with an idea like we were promised robots. I mean, what was the idea of iRobot,right? It was we were promised robots and we don't have them.

Well, let's fix that. Right? I mean, what a crazy ass thing to, you know, what gave us the guts to say, "Okay, who wants to do this? Okay, let's raise our hand and go eat ramen and work 20 hours a day to go and try to make this happen."

It was awesome. It was cool. I want to keep doing it. Obviously, I did. I'm addicted. I can't not do it.

Yeah, you're bringing something else now. We're excited to hear what maybe the mad professors are now, you know, building next. But it also makes you think, you know, when founders go through this incredible long journey of building a company, you kind of touched upon a little bit.

The U.S. especially is all about building amazing companies, encouraging entrepreneurship, European market somewhat similar. But again, if you get to the end destination and you're ready to sell and the government blocks it, it's not a great outcome for the global entrepreneurship population,right?

And certainly not for the entrepreneur either.

It's not great,right? And hopefully that this changes. But during this process, you're also, you know, running the company. I think you sent about 100,000 documents to the FTC,right? During this timeframe. You've got the ongoing, you know, potential partnership with Amazon.

Did you know when that kind of journey, did you know maybe this is just not going to work?

No.

To me, there was absolutely no reason in the world why this deal shouldn't work. I accepted the fact that this deal was going to be highly scrutinized because, you know, Amazon was involved and, you know, the lawyers told us this is going to be highly scrutinized.

But I believe that theright thing usually happens. And theright thing was everyone scrutinized this deal. No, it is not a monopolistic situation. It takes longer than it should to approve and gets approved. And so I was floored when it came down and they said, "No, we're going to block this."

And it's like, "Why?"

For the love of all that isright and just, why? This makes no sense. And it was very strange. I mean, I think there was this weird thing where the legal team for the European Commission actually leaked the fact that this deal was approved to Reutersright before the other announcement came out in a, I mean, seeming attempt to circumnavigate the outcome and try to control the narrative.

I mean, it was really weird and really bad. So

it was kind of dark because, you know, my faith in

the process was definitely shaken. I mean, the process itself is really, really tough where you go under agreement to be acquired and basically you need to operate, you know, they say operate the company as if it's a normal day because we might block this deal and you can't depend on the acquirer.

But at the same time, you need to live up to the covenants and protect all of the assets that the acquiring company is buying. And those two are incompatible.

And it's a little control as well,right?

Right. Well, I mean, you know, you need to run the company independently while not being able to take actions to

change the company to respond to changes in market conditions or what have you. And that's, you know, if the process was two, three months, okay, fine. But if the process is a year and a half, oh my God, you've just, you know, things and the market was changing on a daily basis with us.

And so that it definitely left iRobot when the deal was blocked having to catch up 18 months of change that

because the market had, you know, had fundamentally

moved. And so that was, you know, that was something that the leadership of iRobot after I stepped down

were definitely challenged to react to. You know, so big layoffs, big changes around how product was developed, big changes to try to fit into the new reality.

So again, there's, you know, if you asked anyone who was looking after the U.S. economy and U.S. competitiveness, what should have happened here?

You would get a very different answer than what actually happened.

And it wasn't a surprise. That's the other thing. All the data was there. All the data was presented in 100,000 documents. That's actually underrepresents the amount of documents that were created. And so this was a, somebody was making explicit choices that they wanted the outcome that they got.

And so that's where I.

Do you think

the FTC somewhere in the office, they have like a wall or on their door somewhere where all the companies they've blocked?

I don't wonder. I've seen it,right? I was deposed

and sort of in between the, you know, they give you a break to go to the bathroom or whatever. And, you know, they walk you through and you look at the doors

of the people who work there and on their doors are printed out headlines for the newspaper. So-and-so deal blocked. So-and-so withdraws offer to acquire. These are the trophies.

That's crazy.

Of the FTC. These are the things that the leadership of the FTC celebrate on the doors of their offices as victories. And it was, you know, I was sitting there with the person deposing me and I was like, expecting this person, I mean, I've been told that this wasn't the case, but I just couldn't get through my mind that the person shouldn't be my biggest supporter.

Totally.

Right? I mean, this person should have been my biggest supporter. How can I help you, Colin? You've created something from nothing. You defied all the odds. Here's this opportunity to go scale the business, help America

continue and grow its leadership in the consumer robot industry.

And yet she was just trying to figure out how to block the deal. How can I get something from Colin that could say, "Okay, gotcha, whatever." And

so it was.

It's crazy. Looking back at the lessons you've learned now, you've obviously been through this entire process and that we found this listening and founders might go through similar things at some point. Looking back at the deal, if you were to go back a couple of years before the deal even happened, what would you have done differently?

There's lots of tactics that you could go back and say, "Gee, I should have done this instead of that." I mean, we believe that cleaning efficacy trumped everything. And, you know, there's a big strategic decision around mopping. You know, should mopping be combined with vacuuming or should they be two separate robots?

From a cleaning efficacy perspective, it's really clear. It's two separate robots because there's a reason why you don't push a mop in front of your vacuum. You know, it doesn't work as well.

And so that we

had tried multiple times to have mopping and vacuuming be separate processes. Whereas many of our competitors, because mopping is the dominant culture in China, you couldn't really sell a vacuuming robot unless it had a mopping attachment. And so they were early bringing these two ideas together.

And so it didn't work as well, but the consumer valued it. We missed that. So it's okay, fine.

You know, I think

we should have gone to higher price points faster than we did

because, you know, we were

we believed there would be less of a market up with a $1,200 vacuuming robot than there actually turned out to be. And that was an area where some competitive robots started to gain traction over us. So there were some tactical things we did differently, could have done differently and remained.

You know, the biggest thing that I was trying to do is,

you know, the smart home, I don't think anyone would say the smart home has met expectations. We've slammed up against this barrier of complexity where we really can't deal with the fact that we have 22 different apps on our phone controlling smart devices.

We need a different strategy. And so that we got to where we are today by having a bring your own device, everything works with everything, except everything has its own app. And I was working on

a strategic

move with iRobot to try to bring the convenience of Roomba to the smart home. And the

part of the challenge was at the same time, there was macro challenges and competitive challenges. And so that putting adequate investment into that vision was a problem. And our first attempt where we did an air purifier

did not meet expectations. So, you know, I mean, it's entrepreneurship and building companies is a full context for it. Not everything you do is going to win. I think you said it well. It's an existence full of challenges with occasional successes that pick up for all the challenges.

And so that you got to hope those successes come. But, you know, so had any of that gone differently, then maybe the desire to join forces with Amazon

would have been, wouldn't have happened,right? I mean, because the only

joining forces with Amazon is a great idea. Given the fact that I didn't have the resources, but I did have the vision and I did have the technology and they had the vision and technology and resources to do this.

Okay, let's go do this. I mean, that's how value gets created.

So that was a great step, which clearly would have made a lot of money for shareholders, would have provided and created innovation that would have helped the consumer and the investors of iRobot would succeed. And for me, I get a big new toolbox to go change the world.

And I was ready for that too. If we had been more successful as an independent company, we would have stayed independent longer. And if we hadn't started down this road with Amazon, then it wouldn't have put us in limbo for 18 months, frozen us in a situation where we couldn't react to market changes.

And, you know, and maybe we get the second and third leg of the stool of iRobot moving. Because that was, you know, the other big problem with iRobot. You know, we had Roomba as our driver of revenue and we didn't have Roomba and Scuba and Terra and other robots that could give us a more diversified revenue strategy, which, you know, we were attempting to do, but had not at that time succeeded.

Well, I super appreciate you coming on the show. I think, you know, what you've been through, you were so incredibly humble about it. And I think our audience will agree you were listening. But what we do love, we love a comeback story.

And I know you were up to something new, Familiar Machines and Magic. What are we going to be expecting next?

You know, so I spent 33 years, or at least the last 23 of them, thinking about robots in the home. Thinking about where there are truly opportunities for robots to create more value than they cost.

And

when I started iRobot, the technology to build robots was dark ages compared to where it is today. And so that the

when I left iRobot, you know, I was work through my emotional challenges. But then you look around and AI, particularly AI focused on the control of robots, is the coolest thing that I've ever seen in my lifetime. And you start applying some of the lessons that I described at the beginning.

Robotics is a toolkit, not a thing.

And you take the lessons of understanding the home for 33 years and say, how do I take this new toolbox of AI-powered robotics and look at the home, look at the challenges in the home, you know,

and go build solutions. So this idea that as you look at problems around elder care, around health and wellness, around

the things that people struggle with day to day, other than cleaning the floors, I'm not building another floor cleaning company. It's exciting. And I would tell you that there'll be some amazing announcements as I give a better answer than I just gave to what I'm doing.

But Familiar Machines and Magic, as you can tell by the name, is a different kind of robot company, which is focusing on the consumer, but also focusing on robots interacting with the consumer.

Amazing. We can't wait to hear more. Is this going to be 2026?

Certainly, it'll be clear what we're doing in 2026.

Okay. I like the spontaneous question.

When I think about closing this type of episode, I've watched all of your interviews and we wish we can ask one question, which has never been asked before. But you've been around for so long and you've achieved so much.

I think you probably ask and answered every question. But I think a lot of founders will be listening and hoping to avoid some of the challenges and huge obstacles you face. So my closing question would be, I'm trying to become a better founder.

What do you do at iRobot that you wish you avoided, that you hope other founders don't make the same mistakes?

Founders make mistakes. I mean, that's kind of their superpower,right? The naivete that they don't accept all the reasons why they can't do things. And it doesn't always work out. You know, and I think that, you know, this idea of being faithful to your vision, being able to answer the question, what do you want to have happen?

And having the resiliency to get up when the world is disagreeing with you and keep going is the magic. You know, I think that this whole story, you know, it may be that my great legacy, to the extent I have a great legacy, has yet to be written.

And iRobot is the foundation building for the thing that

happens next. iRobot never set out to be a vacuuming company. We're building the robots that were promised. And we were promised a lot more robots than small dislike objects that clean your living room.

It just so happened that that's where the journey took iRobot.

But the game is not over yet. And now is a time where I have to go and listen to my own advice and say, do I have the resiliency? Do I have the ability to be faithful to my own mission when we started this journey and

make the next chapter spectacularly more successful than the first?

I love that. Thank you so much. This has been incredible. What a journey. And I actually still have my iRobot downstairs. And whatever you do next, we can't wait to see what you do. But a big thank you for coming on the show.

My pleasure. Thank you for having me.