## When the Industry's Outlook Fails to Keep Up with Business Reality

Three tech companies — iRobot, Luminar, and Rad Power Bikes — declared bankruptcy within one week. At first glance, they may seem completely unrelated: a manufacturer of robotic vacuum cleaners, a lidar sensor supplier, and an electric bike producer. However, behind each of these bankruptcies lie similar deep structural problems concerning market dominance, dependence on a single product segment, and external economic shocks.

### The Rise and Fall Story: Rad Power Bikes

Rad Power emerged as a leader in the electric bicycle industry. Founded long ago, it grew before the pandemic thanks to a solid reputation, effective marketing, and genuine engagement in building customer relationships — which is rare in a segment where competition mainly consists of anonymous brands available on e-commerce platforms.

When the pandemic hit, the company benefited from the micromobility boom. People reconsidered their commuting, traveled less to offices, and interest in alternative transportation exploded. In 2023, Rad Power achieved revenues of over $123 million. However, since then, the situation started to decline: to around $100 million the following year, and finally to just $63 million this year, before the company filed for bankruptcy.

Although its product portfolio was diverse, Rad Power never managed to establish a lasting position outside its main electric bike segment. Additionally, the company faced a battery crisis — a service campaign was impossible due to financial reasons, but its inaction in the face of safety threats led to its ultimate downfall.

### Lidar, Autonomous Sensors, and Too Narrow a Strategy: Luminar

Luminar was founded in the early 2010s, officially entering the market in 2017. Its ambitious mission was to revolutionize lidar technology — sensors that were then expensive, large, and mainly used in military and aviation applications. 2017 brought a major boom around autonomous vehicles, and Luminar aimed to meet this demand with affordable sensors.

The strategy resulted in agreements with major automotive players. Volvo became its most famous client, but Mercedes-Benz and other manufacturers also expressed interest. However, the company proved too focused on this single market, which ultimately led to bankruptcy. When the pace of autonomous vehicle development slowed and competition in lidar sensors intensified, Luminar lacked a sufficiently diversified revenue base to survive.

### iRobot and Amazon: When a Merger Becomes the Last Resort

iRobot is the most recognizable of the three companies. Its flagship product, Roomba, became synonymous with robotic vacuum cleaners — a perfect example of a brand name dominating an entire product category. However, this very dominance turned out to be a trap. Technological progress in the industry was so rapid that iRobot found itself on the defensive, desperately seeking a way out of its tough competitive situation.

All signs pointed to a single logical strategy: acquisition by Amazon. The deal was completed, and business media considered it a significant move. However, the FTC blocked the merger, which many see as the direct cause of the company's collapse. Yet, this narrative might be too simplistic — the very need to be acquired suggests that iRobot was already facing deep structural problems that no merger could resolve.

### Macro-issues: Tariffs, Supply Chains, and Chinese Competition

All three bankruptcies reveal a broader trend concerning global trade and manufacturing. iRobot, like many tech companies, became heavily dependent on the Chinese supply chain — not because the choice was poor, but because building a Western alternative over the past 15 years would have been economically unfeasible.

This dependence came at a cost: competitors could easily copy products and enter the market with lower costs. Tariffs posed another real problem. During an administration that imposed tariffs on Chinese imports, many micromobility startups — Boosted Boards and others — experienced severe financial shocks. Tariffs increased production costs and reduced profit margins, putting companies in a difficult position to maneuver amid other crises.

### When Larger Problems Meet the Final Blow

Bankruptcy rarely has a single cause. Usually, bigger structural issues underlie each failure — and then a specific, final shock tips the scales.

For Rad Power, it was the battery service campaign. For Luminar, excessive focus on one market as prospects for autonomous vehicles diminished. For iRobot, blocked merger with Amazon, though this may only be a symptom of deeper issues related to innovation and business reorientation.

One often overlooked aspect in public discussions is: which of these companies sought diversification of their revenue streams? Which truly invested in researching new market segments? Political or regulatory shocks are often blamed for failures, but the real problem lies deeper — in a lack of strategic flexibility and the ability to transform in a rapidly changing business environment.