In a major initiative to consolidate its stance across the home security industry, Amazon Inc., has made an offer to purchase Ring Company, a video doorbell firm, for over USD 1 billion. Incidentally, in the year 2013, Jamie Siminoff, Ring’s founder, had introduced the concept of the smart doorbell on the reality show – Shark Tank. Back then, it was reported that he asked for an investment of USD 700,000 for a 10% stake in his firm, valued at USD 7 million. The idea however, had been rejected, claim sources.
Prior records depict that one of the investors had shown interest in the smart doorbell and had even been prepared to offer the firm USD 7,00,000 in the form of a loan, claiming 10% of the sales revenue till the credit amount was fully paid, 7% royalties on the future sales, and an additional 5% share in the Ring. However, the founder of the Ring, formerly known as DoorBot, had apparently refused to accept the offer. According to the company’s statement, Ring’s sales increased post the product demonstration on the show. Four years later, the firm successfully sold its product to nearly 16000 stores and accrued huge revenues.
Experts believe that the Ring was the early initiator, whose WIFI enabled doorbell makes use of motion detectors to recognize the person approaching the door of the house and then displays the video of the person & sound on the homeowner’s smartphone. As per some of Amazon’s top executives, Ring’s new service will support the Amazon Key, a program that facilitates deliveries to customers while they are not present at home.
Industry analysts predict that Ring’s acquisition is likely to help Amazon strengthen its position across the connected home device industry. The addition of new products to Amazon’s existing line of connected products is certain to help the firm expand its eCommerce business and increase its customer base across the globe, they further state.