Wall Street Ruined the Roomba and Then Blamed Lina Khan

Summary

A few days ago, consumer products company iRobot, the maker of iconic Roomba automated vacuum cleaner, declared bankruptcy. The CEO, a branding and mergers expert named Gary Cohen, sadly announced that the firm could not continue as a going concern. The board, full of lawyers and financiers but not robotics experts, voted to sell iRobot off to Shenzhen Picea Robotics, the Chinese company to which it had offshored manufacturing. There are about 20 million active Roomba vacuum cleaners in operation, and unless Trump regulators or antitrust enforcers act, now all the data harvested from our homes will go to China.The co-founder of iRobot, Colin Angle, was not introspective about this collapse, nor did he associate it within the broader context of the many firms who have had their technology transferred to China. Instead, he, like much of Wall Street, blamed the bankruptcy on Lina Khan. Why? Well she ran the Federal Trade Commission when it investigated Amazon’s possible acquisition of the company in 2022, a deal the two companies ultimately called off. Here’s Angle:“I bet if you asked almost anyone prior to the blocking of the deal with iRobot: Would you rather see iRobot innovating like crazy, coming out with new and better robots for your home, or would you like to see it file for Chapter 11 in the process of being sold to a Chinese manufacturer?” he said. “The wrong thing probably happened.”Many Wall Street dealmakers and foes of antitrust enforcement echoed this sentiment. For instance, former Obama chief economist Jason Furman, who is now the Aetna Professor of the Practice of Economic Policy at Harvard, used it as an example of the problem with populist economics. Blocking mergers, he believes, leads to destructive outcomes and national security problems.Regulators in the United States & Europe blocked Amazon's bid to acquire iRobot. iRobot has not filed for bankruptcy and will be acquired by its main creditor, a Chinese company. This is not a good outcome from t...