The (only) Six Things Hardware Startup Founders Should be Doing

You’ve seen this movie before…an exciting young hardware startup team has great technology that is going to disrupt their industry. They are getting press and money, and it seems as though they’re just a few steps away from greatness. Then, you stop seeing them on the stages and in the media. You check their updates - they are going to come out with their product in just a few months. But those few months never seem to pass by with any action.  What happens in these situations?  Why does it always seem to be the same old story?

Having worked with roughly 1,000 hardware startups, I’ve seen this movie replayed many times. The details are always different, but the theme is always the same. Fundamentally, the startups are taking on too much and they can’t get done what they really need to get done. It is really difficult to build and launch an innovative product in the three-year window that’s usually necessary before market timing and money run out. It’s that much harder if you also must learn how to build and launch an innovative product in that window.  All the software startup successes have made it seem like there can be a lean, agile formula that can be applied, but hardware is not lean, nor agile. 

Hardware typically requires the same baseline executable as software: marketing, IP protection, software development, website, video, crowdfunding, among others. But then it requires so many potential others: industrial design, mechanical engineering, electrical engineering, design for manufacturing, manufacturing, quality control, inventory control, shipping, fulfillment, customer returns, packaging….the list goes on.  On top of that, the sunk costs to get to market are much higher for things like prototyping, tooling, packaging, shipping, and import duties. And, if you make a mistake in your product, you don’t just stay up all night coding it away and releasing an update in the morning, you often lose the entire product and the three months (or more) it took to produce it.  

To be able to get all of this done successfully, the key is to stay focused, particularly at the top. There will be a lot that you need to learn, but avoid the learning experience as much as possible.  Do this by forming a larger founding team that covers multiple disciplines and hiring. The right mentors can help you get straight to your goal and save a lot of time with good advice, as can working with the right partners who can do their job and even some of yours. All in all, hardware startup founders should usually only be doing 6 things: honing the vision, building the team, raising money, understanding the market/customer, doing whatever they have experience with, and (50% of the time) fighting fires because there will no doubt be fires popping up each day. 

You may spend three months figuring out a manufacturing technique, only to realize later that you need to pivot to a different feature or benefit because the market demands it. Whereas if you had the time available earlier to understand the product/market fit better, because you had manufacturing partners that were going to figure out the technique for you, you can avoid the situation altogether.

The best path to market is almost always non-linear, often a moving target that is almost never figured out at the very beginning. It’s an optimized course of understanding that takes time and resources.  If you’re in the weeds and focused on the details of the product, you’ll never have the time, energy, and resources to be constantly improving the five important fundamentals of your business:

  • Hone the Vision
  • Build the Team
  • Raise the Money
  • Understand the Market/Customer
  • Do What You do Best

Along this same line of thinking is, be business-focused, not product-focused.  Successful businesses solve real problems at a profit margin that makes sense. If you know the problem, the solution, the market, and the profit margin, then the product may be easy to figure out. But if you have an idea for a product first, you may get pretty far along the path before you realize that the profit margin for that product makes the business impossible. 

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