GREAT MAKERS SHIP���BUILDING LEAN HARDWARE STARTUPS

#LeanHW

@BENJAMINJOFFE

•  13 years in Asia (CJK) •  Founder of web/mobile

strategy consultancy +8* •  Speaker @ 150+ events •  MobileMonday Beijing

founder (35 events) •  11 angel investments •  Now in hardware with

HAXLR8R

2014���YEAR OF HARDWARE

2014: Year of Hardware

HARDWARE RENAISSANCE PROTOTYPING IS SOLVED Arduino / Pi / 3D printing / Sensors / BLE / Smartphones / Cloud

SUPPLY CHAIN IS BETTER THAN EVER – China (Shenzhen) has the whole chain – Fast, Affordable, Scalable

MORE FUNDING – KickStarter (200,000 HW backers!), IndieGoGo – More VC & Angel money

LIFE OF A HARDWARE STARTUP

FROM CONCEPT TO RETAIL

1.  Concept 2.  Minimum Functional prototype (MFP) 3.  Complete Functional Prototype (CFP) 4.  Design-for-Manufacture (DFM) 5.  First factory run (FFR) 6.  Retail

LEAN HARDWARE RULES “No hardware plan survives contact with a factory”

Cyril Ebersweiler, Founder of HAXLR8R

1.  Design with the right components 2.  A prototype is ready when it can be manufactured 3.  Your factory is your most important partner 4.  Be memorable 5.  Pick the right business model

HARDWARE’S DEATH TRAPS

What is your NVU plan?

THE NVU CURVE

Founders Friends Family Fools

PROTOTYPING

PRODUCTION

SCALING

TIME

$$

Crowdfunding

Accelerators Angels

Sales POs Banks VCs

Bridge of Death

Pre-orders

N V U

If you survive it, others will envy you!

GOLDEN RULE OF LEAN HARDWARE

GREAT MAKERS SHIP

BUILDING WITH CHINA

THE APPLE CASE

BEFORE Asia was cheaper TODAY Factories in Asia can scale (up and down) faster

Asian supply chains have surpassed what’s in the U.S. (Labor cost is a minimal factor)

RESULT “Made in the U.S.A.” is no longer a viable option for most Apple products.

•  In Shenzhen (hardware capital of the world) – Cash + Mentoring – Components all around to iterate faster – Source suppliers – Get ready to manufacture (and crowdfund)

•  29 startups

•  16 crowdfunding campaigns (avg. $250,000)

FROM PROTOTYPE TO PRODUCTION

PROTOTYPING

PRODUCTION

SCALING

TIME

$$

Bridge of Death

Founders Friends Family Fools

Crowdfunding

Accelerators Angels

Sales POs Banks VCs

Pre-orders

Accelerator program

HARDWARE IS NOT THE KEY

•  Pure hardware is commoditized quickly

•  A better way – Combination HW+ SW – Strong Positioning (‘a better way to catch mice’) – High quality, high margins (rather than low cost) – Lead Mindshare (media + marketing + reviews) – Timely Financing and Distribution

SUMMARY

IT’S STILL CALLED HARDWARE FOR A REASON…

•  LONGER CYCLES than software

•  NO “MVP” (bad ratings will kill you)

•  BROADER SKILLSET needed���(electrical + mechanical + software / design / manufacturing / financing / distribution)

•  MORE BARRIERS to reach customers

ON THE BRIGHT SIDE

•  LEGO was fun, hardware is fun too

•  Better ecosystem than ever before

•  Less competitive than software

•  People pay for things

���BENJAMIN@HAXLR8R.COM ���

@BENJAMINJOFFE ���������

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