Ecobee Acquired by Generac for $ 770 Million

Toronto-based smart home thermostat startup Ecobee is being acquired by Generac holdings for $ 770 million, the companies announced on Monday.

The acquisition is expected to close in the fourth quarter. Ecobee CEO and founder Stuart Lombard told The Verge that he will remain CEO and that the company will operate as a subsidiary of Generac. He has no plans to move out of his Toronto office and has plans to "significantly" grow the office later this year, Lombard said.

Ecobee was founded in 2007 and has expanded from the smart thermostats for which it is known, adding a voice-controlled home security camera that functions as a home security system to its line. Generac, based in Waukesha, Wisconsin, was founded in 1959 and manufactures commercial and residential backup power generators; The New York Times recently estimated that Generac accounted for 75 percent of home generator sales in the US Last month, the company opened a new plant in Trenton, South Carolina.

But Ecobee hasn't released a new thermostat since 2019 and has many competitors in the smart thermostat space. They include established brands like Google's Nest and Honeywell (owned by Resideo) that are now lowering it in price and newcomer giants like Amazon that just announced a $ 60 smart thermostat. Ecobee's advantage has long been flexibility with various smart home platforms, but it hasn't had the resources available to its larger competitors. Last year, it postponed plans for a smart lighting line and laid off 10 percent of its staff.

Meanwhile, Generac has bought several smaller companies over the last year and a half, acquiring Pika Energy, Enbala Power Technologies and Neurio Technologies and combining them into an energy storage division. Generac president and CEO Aaron Jagdfeld said in a statement that Ecobee represented an important addition to its residential energy technology offerings. "The ability to combine Ecobee's cutting-edge technologies with Generac's power generation, energy storage and energy management devices will allow us to create a clean, efficient, and reliable home energy ecosystem that will not only save homeowners money but also help grid operators meet the challenges of an electrical grid under enormous stress by providing solutions to better balance supply and demand."