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Herman Miller Inc
Best Buy Co Inc
(Corrects second paragraph to reflect that the UP wristband is not wireless.)
Hosain Rahman met Steve Jobs in 2004; it did not go well. Rahman’s five-year-old startup, Aliph, was about to begin selling headsets for mobile phones, and one of his investors had arranged for him to show Jobs his first creation, a stylish earpiece connected to a phone with a thick cord. Jobs hated it. In an hour-long session in Apple’s (AAPL) offices, Jobs intuitively exposed every shortcut the company had taken. “It was a shellacking,” Rahman says. “It was one of the most painful and formative experiences of my life.”
Rahman believes that conversation was a turning point for the company now known as Jawbone. After that meeting, the San Francisco-based company began work on an updated device and has now sold 10 million Bluetooth earpieces, making it one of the largest makers of peripheral headsets in the world. Jawbone also has begun positioning itself in a very Apple-like way, as a maker of consumer products that combine intricately designed hardware and easy-to-use software. Last year, Jawbone introduced a well-regarded wireless speaker, called the Jambox. And on Nov. 6 it will begin selling UP, a sensor-laden wristband that connects to a mobile phone and tracks elements of the wearer’s health, such as sleep patterns and physical activity. “We think we can create an incredibly valuable series of wearable computers and specialized devices,” says Ben Horowitz, a Jawbone board member and partner at Andreessen Horowitz, one of the venture capital firms that plugged $120 million into the company in 2010.
The history of Jawbone stretches back more than a decade. Rahman and co-founder Alexander Asseily were friends at Stanford University and incorporated the company in 1998. They focused at first on developing technology to cut out background noise on phone calls, which they thought could ultimately make speech recognition more accurate. In the early years, when technology funding was sparse, they kept the company running by customizing their noise-suppression technologies for Darpa, the Defense Dept.’s research and development arm, before ultimately deciding to enter the market with the wired headset Jobs hated in late 2004.
The headset won a variety of design awards but didn’t sell well. Jawbone then recruited famed industrial designer Yves Béhar, known for his work with clients such as Herman Miller (MLHR), One Laptop per Child, and Prada (PRDSY) to serve in-house as chief creative officer. (He now spends about half his time designing hardware for the company.) The company started selling its flagship product—a slick, metallic-looking, and eminently losable Bluetooth earpiece—in 2007. Jawbone earpieces alert users to upcoming calendar appointments and can trigger a phone to dial numbers associated with those events. Jawbone also struck a partnership with Apple. Its products are sold in Apple’s stores, and its headsets were the first to integrate with the iPhone’s iOS operating system; the screen of an iPhone connected to a Jawbone headset, for example, has a second battery indicator showing how much juice is left in the headset.
The Jambox, which went on sale last fall for $200, is now the top-selling digital speaker in the country, according to the company. It’s light and rectangular, connects to any mobile phone or PC, and produces crisp sound, considering its size. Horowitz says Jawbone is working on a new speaker, Big Jambox, which the company declines to discuss.
And now there’s UP. “The big idea here is to help make people consumers of their own health,” Rahman says. “We probably know less about our bodies than we do about our phones.” UP is supposed to change that. The pliable rubber-coated wristband is meant to be worn nonstop for 10 days at a time, even in bed and in the shower. An accelerometer inside tracks data like the number of steps a person takes in a day and the number of calories he or she has burned. The device also monitors sleep patterns and can be programmed as an alarm that wakes the wearer, within a preset time range, at the ideal moment in their sleep cycle. The accompanying iPhone application lets users share their UP data with friends, create personal challenges, and record and track each meal they eat.
Rahman envisions insurers, schools, and companies buying them to help keep clients, students, and employees healthy. Consumers will get a chance to try it out this month when UP goes on sale for $100 in Best Buy (BBY), Target (TGT), and Apple stores. “We are not science experts or experts in your health,” Rahman says. “We are just doing what Silicon Valley does best, which is giving people the tools to experience things in new ways.”
The bottom line: Jawbone, a maker of stylish “wearable computers,” hopes its $100 UP wristband will appeal to insurers, employers, and schools.