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…stepped down in 2024 after the attempted Amazon acquisition fell through. And today he is making a case that basically iRoot was a casualty or roadkill as he put it. Uh the direct result of misguided antitrust enforcement by the US government and a tragedy for American innovation. Yes, but as you will hear, he is also willing to admit that he did make some mistakes along the way. And that gives us a rare opportunity, Kevin, because usually when CEOs come on the show, they want to make the case that they are one of history's greatest geniuses and that they are about to change the world for the better for all of us. It is much rare for a CEO to come on and say, "Hey, look, here are some of the hardest calls I had to make and here are some of the ones I got wrong." >> Yeah. So, in order to hear his angle, let's bring in Colin Angle. Colin Ango, welcome to Hardfork. >> Great to be here. >> So, we've invited you on today to talk about iRoot, the company that you started and and ran for many years. Uh the maker of the iconic Roomba robot vacuum. And to start, I'd like to kick things off with just the most basic question possible. Why did iRoot go bankrupt? >> You know, it's a complicated question. Uh simple simple to ask, hard to answer. We led the world. We invented the category of of consumer uh robotics back at the launch of the of of the room in 2002 and and um uh you know for 17 18 years uh really grew the category and then uh you know as it got more competitive and the world uh changed we had to change with it. So um uh you know ultimately uh you know bankruptcy is is something that uh happens when you need some external help to take the next step in the chapter of development. Liam McCabe at the Wire Cutter, who's reviewed house cleaning robots for a long time, argued recently that iRoot hit its peak in 2018 with the release of the Roomba i7 Plus, uh, which could clean specific rooms on command and automatically dump the contents of its dust bin into its own dock. Uh but shortly after that uh Chinese competitors began to pull ahead uh including Robo Rock which I think became iRoot's biggest Chinese competitor uh entered the US market in 2018. What what were the core problems in your view that started to erode that uh market leadership? You know, it's certainly the advent of this new type of competitor, the the Chinese fast follower who had access to uh the Chinese marketplace, which iRoot effectively did not um for various uh um pragmatic and political reasons, gave a protected market to cut your teeth on for the competition. um you know and the the marketplace uh was not uh a level playing field. >> What what do you mean by not a level playing field? Do you mean the ability to sell in China specifically or is there something else? >> Correct. Yeah. I Iroot was uh you know for a small period of time iRoot was the leading manufacturer of vacuuming robots in China. that it stopped um because China decided that this was a market of interest uh and they were going to uh ensure that Chinese companies were uh advantage to succeed there. Uh you know the Chinese government uh provided subsidies direct subsidies to our was a market of interest uh and they were going to uh ensure that Chinese companies were uh advantage to succeed there. Uh you know the Chinese government uh provided subsidies direct subsidies to our competitors and we had to overcome that as well. So, you know, in an emerging marketplace, uh, you know, it's a cage match and it certainly got hard and it it, uh, uh, you know, it got increasingly competitive. So, you know, companies need to adapt and ultimately we were open to other strategies to enable us to continue to innovate. Um which is why uh when Amazon came and said hey we think we have a vision that is compatible with your vision uh it made a lot of sense and we were excited >> and we want to talk about the acquisition but I have one more product question first and sure I want to say like it's it it's really hard to invent a whole category and to like be a market leader for like 18 years and as you say like competition is brutal and so I do appreciate you just like you know sitting through our questions about you know uh about about some of the difficult decisions that you had to make along the way some of which didn't turn out right um this is just something that happens uh to to CEOs but I think there's one question that comes up over and over again when you read the uh the sort of Roomba obits and it is that Roomba relied on cameras to get around and not LAR this sort of next generation technology and it seems like the Chinese competitors really embrace LAR and consumers prefer that over time so while you were leader you guys didn't embrace LAR. And I'm curious what role you think that played in all this. >> You know, it's I'm entertained by the question. >> Um because it's wrong. Uh it was wrong then. It's wrong now. I mean, does your autonomous driving vehicle have a lighter on it? >> No. Why? Because it is a dead-end technology which gives you no situational awareness. Wait, but Whimos have LAR on them? I mean, this is sort of the classic Whimo Tesla sort of divide sort of shrunk down to the household robot. >> Yeah. >> Well, sure. Then call it the Robbo Rocky robot divide. And under my leadership, I was playing the Tesla card, which said, I will put every penny of COGS in the Roomba against better visual understanding because I believe at the time, this was this was uh very publicly stated, uh the Roomba with a camera could understand what it was doing, could understand whether it was doing a good job or a bad job and could play a role as the hub of the smartome in a way that a robot driven by a LAR could not. >> Uh, and the maps that you make with a camera are more rugged and robust to moving furniture. And you know, we explicitly decided not to put lidar on Roomba because it took away from the cogs that I could put against CPU and and other technologies. And so this was not a why did you fail to innovate? This was a strategy, >> right? I I guess I I'm not contending that most consumers care whether their robot vacuum uses LAR or cameras. I don't think most people know. I don't think most people care. I certainly had bought Roombas uh you know for my first apartments and homes before I knew what their robot vacuum uses LAR or cameras. I don't think most people know. I don't think most people care. I certainly had bought Roombas uh you know for my first apartments and homes before I knew what what technology was running on them. I just care does this thing clean my floors or not. Um and I think >> you know over time there started to feel like a gap between Roombas and some of these Chinese competitors with other features. Things that were unrelated to navigation. Things like does this thing have a wet mop as well as a vacuum in it? Can there sort of be these other features that can maybe make this thing a little more useful or require a little less oversight? So, are there other features that the Chinese competitors and other competitors introduced into their robots that you wish the Roomba had adopted earlier? >> So, honestly, we got wet mopping wrong. Uh we built our first mopping robot two years after Roomba and we felt like creating an independent mopping solution was the right strategy and it gave the best customer benefit. It did the best job >> as in having a safer robot that mops the floors than the one that vacuums the floors. >> Yeah, we called it Scuba. uh and uh you know we we built it, it worked great, but the customer didn't go for it. It was never going to work as an independent product, but it was going to work as an incremental feature and we reacted late and we took some damage and had to do some uh rugged hustling to go catch up. So, you know, I deserve arrows for for the for mopping. Um, I I believe that um the LAR people are still wrong and I just wish we had moved faster and and and had a longer runway before that because that led to a great place. >> Let's I feel like we we sort of um missed the the middle of the story, which is the uh attempted sale to Amazon. You you mentioned it earlier, but I I kind of want to revisit that. Um, so in August 2022, Amazon offers to buy iRoot for $1.7 billion. It ultimately falls apart over antitrust concerns. I think some people look at that and they think, well, that seems fine because Amazon's already plenty big and I don't want it to own like, you know, every vertical of e-commerce in existence. Um, but I imagine that you may feel quite differently. So make your case that this was a bad outcome for America that iRoot was not able to become a part of Amazon. >> Well, that's pretty easy. uh you know we got to a point where uh for very good and and uh understandable reasons the market pressures and the competition led to an economic model where iRoot was finding itself pressured to innovate and you know iRoot was a proxy for the United States because we were the only public company doing consumer robotics and so that Uh if you were a fan of having consumer robotics being an industry where I America could cons could claim leadership, you needed by robot to continue to be able to invest like big dogs and uh create innovations that was going to give consumers the choice that um uh they were asking for. And so the challenge was the acquisition seemed to become all about Amazon and not at all about consumer preference. leadership in the consumer robot industry…

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