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Bluesmart

Winter 2015Acquired

Bluesmart makes smart luggage powered by an app to empower people to…

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BL

Bluesmart

Winter 2015Acquired

Bluesmart makes smart luggage powered by an app to empower people to…

Save
Company details

Bluesmart is a global travel company that became famous for creating the world's first smart connected luggage. Its first product, the Bluesmart Carry-on, launched in October 2014 through Indiegogo and raised more than $2M in pre-orders from more than 10,000 backers in 120 countries worldwide. It was named "Top Innovative Product and Service"​ by Forbes Magazine, awarded "Best Travel Gear"​ by Fast Company and “Best of the Best"​ Red Dot Design Award. The company is backed by Y Combinator and other top Silicon Valley venture investors. Bluesmart is headquartered in New York with offices in Hong Kong, China and Argentina.

Location
New York City, NY, USA; New York, NY, USA
Founded
2013
Category
IoT
YC profilebluesmart.com
Founder
  • AV
    Alejo Verlini
    Founder/CPO
    LinkedIn

Bluesmart is a global travel company that became famous for creating the world's first smart connected luggage. Its first product, the Bluesmart Carry-on, launched in October 2014 through Indiegogo and raised more than $2M in pre-orders from more than 10,000 backers in 120 countries worldwide. It was named "Top Innovative Product and Service"​ by Forbes Magazine, awarded "Best Travel Gear"​ by Fast Company and “Best of the Best"​ Red Dot Design Award. The company is backed by Y Combinator and other top Silicon Valley venture investors. Bluesmart is headquartered in New York with offices in Hong Kong, China and Argentina.

Location
New York City, NY, USA; New York, NY, USA
Founded
2013
Category
IoT
YC profilebluesmart.com
Founder
  • AV
    Alejo Verlini
    Founder/CPO
    LinkedIn

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On this page
  • Overview
  • Founding Story
  • Timeline
  • What They Built
  • Market Position
  • Target Customers
  • Market Size
  • Competition
  • Business Model
  • Traction
  • Post-Mortem
  • The direct trigger
  • Contributing pressure
  • Key Lessons
  • Sources

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Bluesmart (W15) at a glance

  1. Demand was real. More than $2 million in preorders and a later claim of over 40,000 first-generation units shipped proved that travelers wanted connected luggage.
  2. Removability controlled the product. The original 37 Wh battery was non-removable, so airline rules invalidated the architecture without banning every smart bag.
  3. Integration concentrated the blast radius. Luggage, charging, tracking, apps, and support shared one hardware platform, so a battery rule impaired inventory and installed units together.
  4. The asset sale was not continuity. Travelpro bought technology, designs, brands, and IP through the wind-down, but manufacturing, sales, warranties, and returns stopped.

Overview

Bluesmart made connected luggage feel like an obvious travel upgrade, then discovered that one embedded component could determine whether the whole product was allowed on a plane. The YC Winter 2015 company sold a carry-on with location tracking, proximity alerts, an app-controlled lock, a built-in scale, USB charging, and a 37 Wh lithium-ion battery. Its 2014 crowdfunding launch collected more than $2 million in preorders from over 10,000 backers across 120 countries.[1]

Demand was real. Bluesmart later said it had shipped more than 40,000 first-generation units.[6] The fatal constraint was architectural: the original battery was installed in the suitcase and could not be removed.[5] When airlines tightened smart-bag policies around lithium batteries, bags with non-removable batteries became unacceptable. Bluesmart said the change made its products effectively unusable and wound down in May 2018. Travelpro acquired its IP, designs, technology, and brand, but the transaction terms were not disclosed.[12]

Founding Story

The public record does not produce one tidy founder roster. Y Combinator currently lists Alejo Verlini. Contemporaneous interviews identify Diego Saez Gil as CEO and co-founder and Tomi Pierucci as his co-founder; a 2014 profile also names Martin Diz as an early team member.[1][2] A Bluesmart design-patent assignment names additional inventors, but inventor status alone does not establish that each was a founder.[13]

The idea began after Saez Gil lost a suitcase between New York and Argentina. He recalled: “The idea came up in the middle of a conversation during a coffee meeting with Tomi Pierucci… I had lost a suitcase between New York and Argentina.” Saez Gil brought travel-software experience from WeHostels; Pierucci knew physical-product manufacturing. “We drew a prototype on a napkin, and that was the beginning,” Saez Gil said.[2]

The team used crowdfunding as market proof. In a 2016 interview, Saez Gil said, “We ended up raising two million dollars in a period of three months, and that really validated that this was a really good idea.” After YC, the team moved to Hong Kong to stay close to manufacturing in Shenzhen and later pursued Asian distribution.[3]

Timeline

  • October 2014: The first Bluesmart Carry-on launched on Indiegogo, taking more than $2 million in preorders from 10,000-plus backers in 120 countries.[1]
  • Winter 2015: Bluesmart joined Y Combinator.[1]
  • May 2017: IATA published guidance for baggage containing lithium batteries and electronics.[8]
  • June 2017: Bluesmart promoted Series 2, a broader family of connected travel products.[7]
  • December 2017 to January 2018: American announced an airline-specific policy, effective January 15, requiring a removable battery in case a smart bag had to be checked; its FAQ said this was not then an FAA mandate.[9]
  • May 1, 2018: Bluesmart announced its wind-down and said the policy change had put it in an “irreversibly difficult financial and business situation.”[11]
  • June 21, 2018: A Bluesmart assignment-for-benefit-of-creditors entity assigned a suitcase design patent to Travelpro BSI.[13]

What They Built

The original carry-on joined a hard-shell suitcase to Bluetooth-connected software. Customers could locate a bag, receive separation alerts, lock it from an app, weigh it through the handle, and charge a phone from the internal battery.[4] The battery was rated at 10,400 mAh at 3.8 V, or 37 Wh, and was not removable.[5]

Series 2 widened the product family to a carry-on, checked suitcase, laptop bag, and passport pouch. The advertised system added GPS, 3G, Bluetooth, travel information, app locks, scales, and charging.[6] The laptop bag advertised a removable power pack, but the observed campaign material does not establish that every suitcase battery met airline removability requirements.

Market Position

Target Customers

Bluesmart targeted frequent flyers willing to pay a premium for control and reassurance. The pitch was especially strong for technology-forward travelers worried about lost bags, overweight fees, dead phones, or forgotten locks.

Market Size

No reliable market-size estimate appears in the source packet. Crowdfunding supplied better company-specific evidence: more than 10,000 initial backers across 120 countries and a later claim of 40,000-plus first-generation units shipped.[1][6] Those figures demonstrate international demand, though they do not reveal repeat purchases, returns, or profitable scale.

Competition

Bluesmart competed with established luggage brands on durability and distribution, electronics makers on device reliability, and newer smart-luggage entrants on features. Its integrated system was distinctive, but integration also concentrated risk. Travelpro's current guidance favors luggage that uses removable USB power banks and tells travelers to confirm rules with their airline, rather than presenting a continuing Bluesmart connected line.[14]

Business Model

Bluesmart sold premium hardware. Series 2 campaign prices started near $295 for the carry-on, $325 for the checked suitcase, $195 for the laptop bag, and $95 for the passport pouch.[6] Each sale bundled costs and obligations beyond ordinary luggage: manufacturing, embedded electronics, batteries, mobile applications, cellular service, warranties, returns, and customer support.[7]

Public sources do not disclose revenue, gross margin, warranty costs, inventory exposure, cellular expense, or cash runway. The pricing shows premium positioning, not unit economics.

Traction

Bluesmart's traction was strongest where it was visible. Its first campaign cleared $2 million, attracted more than 10,000 backers, and reached buyers in 120 countries.[1] By the 2017 Series 2 campaign, the company reported shipping over 40,000 first-generation bags.[6]

These numbers rebut the simple claim that consumers did not want smart luggage. They do not establish profitability, retail sell-through, retention, or the cost of supporting connected hardware worldwide.

Post-Mortem

The direct trigger

Airline policy collided with the product design. IATA's May 2017 guidance said a battery installed mainly to charge other devices was a power bank and had to be removable so the passenger could carry it in the cabin if the bag was checked.[8] American then made its own practical boundary explicit: remove the battery from checked smart luggage; reject a bag if the battery cannot be removed.[9]

This was not a ban on every smart suitcase. It was a removability rule, implemented through airline-specific policies that can vary. Bags designed around removable batteries could continue, subject to carrier acceptance. Bluesmart's installed battery could not be fixed with an app update. Existing inventory, tooling, and customer units embodied the incompatible choice.

Contributing pressure

The policy change is the evidenced proximate cause, not proof that every other part of the business was healthy. Bluesmart was simultaneously operating a luggage company, electronics product, cellular service, and mobile software platform. Series 2 increased that surface area while regulatory guidance was changing. No public evidence quantifies whether margins, cash, or redesign lead time could have supported a recall or replacement program.

Contemporaneous reporting says Travelpro bought Bluesmart's intellectual property, designs, technology, and branding.[11] The patent record adds precision: the seller was an assignment-for-benefit-of-creditors entity acting for Bluesmart Inc.'s creditors.[13] This was an asset disposition, not evidence that Travelpro acquired the operating company. Price, assumed liabilities, employee outcomes, customer-data treatment, and the complete asset schedule remain undisclosed.

Key Lessons

  1. A compliance-sensitive component can control the whole product. When the buyer's intended environment is commercial aviation, airline acceptance is part of the product architecture.
  2. Hardware needs a path around policy changes. A removable, replaceable battery would have isolated much of the regulatory risk.
  3. Crowdfunding proves appetite, not resilience. Preorders and shipments validated demand but did not reveal whether the company could finance a redesign.
  4. Product breadth multiplies obligations. More bags, radios, apps, and accessories create more certification, supply-chain, and support paths.
  5. The category survived the company. Travelpro's acquisition and today's removable-power-bank guidance suggest the useful idea persisted in a safer form.

Sources

  1. Y Combinator, Bluesmart company profile
  2. PanAm Post, interview with Diego Saez Gil
  3. ChinaTravelNews, interview with Diego Saez Gil
  4. Y Combinator, Bluesmart product announcement
  5. Bluesmart Carry-on manual
  6. Indiegogo, Bluesmart Series 2 campaign
  7. PR Newswire, Bluesmart Series 2 announcement
  8. IATA, May 2017 smart-baggage guidance
  9. American Airlines, Smart Bag Policy FAQ
  10. American Airlines, policy announcement
  11. Engadget, Bluesmart shutdown and asset sale
  12. TechCrunch, Travelpro asset sale
  13. Google Patents, Bluesmart suitcase assignment history
  14. Travelpro, current smart-luggage guidance