Even with £18 million in the bank.

Smartwatch maker Pebble seems to be in some trouble. According to sources close to the company, the company is having trouble maintaining its growth and has turned to a Silicon Valley bank for a £5 million loan and £5 million line of credit. Valley VCs have been turning down the company’s requests for new capital.

Pebble CEO Eric Migicovsky offered no comment.

The company, which recently raised £20 million in a wildly successful Kickstarter, currently has 150 employees and is still hiring. Even with the crowdfunding infusion – which amounts to about £18 million after fees – the company is shopping for VC money in order to maintain growth and turned to a bank loan “in order to stay afloat.”

The source noted that many employees were unhappy with the direction of the company as it turns to face competitors from Apple, Android, and outside. The Olio watch, for example, may take Pebble’s indie smartwatch crown when it is released. Pebble recently launched a follow-up to their flagship £59 black-and-white e-paper watch, the Pebble Time. The new model features a color e-paper screen and a built-in microphone.

All is not lost at the company… yet. Employees I spoke to anonymously were cautiously optimistic. However, a Glassdoor post from March suggests that the hiring process – run by a General Counsel and former Apple honcho Jeff Hyman – is unpopular.

“We’re a young company. The outlook for Pebble is very positive,” said a current employee who preferred to remain anonymous. “It’s been a remarkable journey thus far.”

More worryingly, the anonymous source notes that employees within the company reportedly aren’t happy after Pebble has pivoted to address competition from companies like Apple, as well as fresh attacks from Android devices. Manufacturers like LG and Samsung haven’t been standing still with their own device offerings, and though Pebble has had an early mindshare and market lead, it can’t hope to match the marketing chops of a giant like Apple.

If Pebble is having trouble, it seems likely to be related to its efforts to expand rapidly. It’s hard to argue that the company’s £59 products compete directly with most of its Android or iOS competitors, when these devices sell for £300+ and are often more limited as far as their ability to link to other products (and exact limitations vary depending on the smartwatch). Furthermore, the entire market is so new, it’s premature to be calling winners and losers. Pebble’s strong brand and general consumer satisfaction should stand it in good stead, provided that the financial operation of the company isn’t out of whack.

Pebble has previously said that its third-generation timepiece should be ready to ship by this summer. The company has generally taken a different tack from Android or iOS-based products, with much weaker underlying hardware, but emphasizing battery life. Instead of charging once per day, Pebble claims its devices can run for up to a week, and its watches work with both Android and iOS. There’s room enough in the market for small, svelte devices like Pebble, as well as the more powerful hardware offered by Apple’s Watch — hopefully the company is able to iron out any issues it’s facing.

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