Smartwatch brand Pebble is likely to disappear altogether after its $40m deal with Fitbit goes through, City A.M. understands.
A source close to the company said it had shed all of its workers, including back-office functions such as the communications team - apart from its software team, which will be absorbed by Fitbit once it has been bought.
"This will be the end of the brand in its entirety," the source said. A spokesperson for Fitbit said it was not speculating on rumours at this stage.
US tech website The Information reported last night that health tracking band maker Fitbit was gearing up to buy Pebble, the Kickstarter-funded company which kicked off the smartwatch craze.
Tech blog Techcrunch reported the deal will value Pebble at between $34m (£26.8m) and $40m - just a year after rumours suggested watchmaker Citizen was planning on buying it for $740m.
For its part, Pebble sent out a mysterious tweet - which it then rapidly deleted.
Oh. I think Pebble is in trouble. pic.twitter.com/M8nV0UGif9— Simon G (@sibrow) December 1, 2016
In March this year Pebble laid off 40 people, about a quarter of its workforce, with chief executive Eric Migicovsky telling Tech Insider it had raised $26m in debt and equity funding on top of its Kickstarter campaign.
In early 2015 the company smashed crowdfunding records by raising $500,000 for its second smartwatch, the Pebble Time, in just 17 minutes - doubling that after 50 minutes.
However, there have been signs all is not well in the smartwatch world. Figures published in July by analyst IDC showed sales of Apple Watches fell 55 per cent in the second quarter, compared with the same period last year.
And at the beginning of last month shares in Fitbit slumped 30 per cent after revenue forecasts fell well below analysts' expectations.