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You have to remember the overhead for that $5m in revenue would only be a few engineers let's say 5 at $1m, that's $4m profit.

Whereas on the $43m they still had to manufacture, ship, hire designers, engineers, etc.

That $4m profit would be a LOT more than 10%, that would cover 20 people's salary



I was assuming a flat "free" boost to their total revenue stream, so my assumption was even more generous than yours.

I sincerely doubt they were only 10% of revenue away from being solvent, even if it was money that came out of nowhere. Reports I've heard are that Fitbit paid ~40m to pay off Pebble's debts, meaning that instead of $10/yr the subscription fee would have to have been closer to $10/mo.




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