Ask Us Anything: Y Combinator Hardware Companies Crowdfunding

https://news.ycombinator.com/item?id=11291060

by liseman • 10 years ago

89 135 10 years ago

news.ycombinator.com

I'm the Director of Hardware at Y Combinator, and we have awesome companies in our current batch running crowdfunding campaigns. Ask their founders anything! Participating will be the founders of Tovala, Soundboks, Enflux, and Hykso. Also joining me will be Philip Winter, CEO of Nebia, from our most recent batch.

lindseya4• 10 years ago

At what stage should your product be before you launch your campaign?

pwinter2810• 10 years ago

I think it depends a lot on the product. If you ask @liseman or Kevin Hale they'll say launch NOW! That was the advice we got. :) In all seriousness I think you obviously need a working prototype, and clear validation that people like your product! Most importantly you should know what it's going to entail to deliver on your promise.

jmcmahon4433• 10 years ago

What are the pros and cons of crowdfunding, vs. self-funding, vs. VC-funding for a hardware startup?

When should I be using which sort of funding?

drabie12• 10 years ago

Lots of pros and lots of cons here...

Crowdfunding: Pros --> Big platform that you can piggyback on; somewhat well-understood form of funding; can leverage to build a brand Cons --> Less control over your brand and your message (e.g. hard to A/B test); commission

Self-funding Pros --> Complete control over your website, message, brand, etc. Can offer whatever incentives you want. Cons --> Harder to get the word out, generate press, access early adopters

VC funding --> This is important should you want to build a high-growth business and avoid the pitfalls of a lot of Kickstarter campaign. We've supplemented our Kickstarter campaign with VC funding and used crowdfunding as a means to get early adopters, build our brand and fund our first production run.

Hykso15• 10 years ago

Hi jmcmahob443,

My name is Khalil, CEO of Hykso (www.hykso.

Are you talking about product crowdfunding like Kickstarter and Indiegogo or equity crowdfunding?

thirru8• 10 years ago

Hey Khalil,

What was the main reason for you going with a selfstarter (your own website) over IGG/KS? Would you do it again?

jmcmahon4433• 10 years ago

Both.

lindseya4• 10 years ago

Did you make your own videos or work with a video production company?

pwinter2810• 10 years ago

We made our own storyboard, Carlos, my co-founder is very creative and a good storyteller so he crafted the arch of the video. We studied Nancy Duarte's stuff. We worked very closely with our videographer who also put his heart and soul into it. In short, storyboard/script in-house, filming/editing outsourced.

jmcmahon4433• 10 years ago

What do I do if I need to use another company's patent in my product? How do I approach the situation/negotiation?

liseman8• 10 years ago

Don't copy people's products. Other than that, companies spend too much time too early worrying about (and spending money on) IP. Prove demand for your product by launching; you've got a year post-disclosure to file a provisional patent.

beambot• 10 years ago

I think you're wrong. You have a year after disclosure to file a FULL UTILITY PATENT. Provisionals give you a 1-year priority date.

jeiting• 10 years ago

Did you have experience in hardware before this? Do you think that experience building hardware products is a pre-requisite to starting a hardware company?

wilcoxbr3• 10 years ago

Yes. I've had about 10 years working in hardware. Some of those years were at other startup companies.

Experience helps, but as in most endeavors, is not required. You gain experience by doing.

The most important thing you can do is get started and figure it out as you go.

lindseya4• 10 years ago

What strategies did you use to get the word out about your campaign?

pwinter2810• 10 years ago

We built up a big email list. Starting with the team we had ~12k emails collectively (team of 6 people). Everyone we had ever emailed. And tiered the emails/frequency. We also did a lot of pilots beforehand and gathered interest from people who had ACTUALLY interacted with the product. And in our case had showered with Nebia!

mariusz331• 10 years ago

Thanks for doing this!

How do I get started with hardware? I'm a software engineer trying to break into the hardware field. What resources can you recommend for someone in my shoes?

drabie12• 10 years ago

Happy to help. My background is actually in food and business, so I didn't have any hardware background. Your best bet is to immerse yourself in the hardware world - meet as many people as you can; join maker groups; go to local universities to meet engineers; and read as much as you can online. Ultimately, try to find a co-founder that has the skill set and knowledge to complement you.

mrshuptrine• 10 years ago

Do you think US companies have any ethical obligations to manufacture in the US? On that same vein, is there a marketing value of saying, "American-made" that could justify the higher manufacturing costs?

pwinter2810• 10 years ago

Good question. I'll take this one since we are trying to do all of our manufacturing in the US. I do not think companies have an ethical obligation to manufacture in the US at all. Make the product where you can make it BEST. And you have to self-define what BEST is. In our case we care a lot about high quality and cosmetics. So it made sense to focus on the US, where you can have more oversight and be on the line.

As for marketing value of "American Made" I think it can be very helpful, but you have to make that a part of your brand. Otherwise it won't make much of a difference.

thetli8• 10 years ago

Do you think hardware IoT companies should eventually open source their hardware to solely focus on the software? (Based on the belief that if we can make it, there's always someone who can make it better for cheaper). How would we go about doing that in a way that does not greatly damage revenue streams?

Hykso15• 10 years ago

Open source it is a substantial investment of time and energy in my opinion.

Some products will just not have a big developer community behind it also.

But again, online community is one of the biggest defense as a company and I definitely software should be a focus in most IoT companies.

wilcoxbr3• 10 years ago

The honest answer is that it depends. There is not a clear cut answer for this because it highly depends on the market, business model, value proposition, etc.

Development and production of hardware is fundamentally different than software. Thinking and making are separated much further in time and resources, and copy-paste simply doesn't work the same way.

The statement of open sourcing hardware and focusing solely on the software implies someone out there is magically going to make high-quality hardware for your software to run on. That's a thorny assumption.

Most IoT is more than just PCB's. There are also enclosures, actuators, and physical UI/UX. Relying on someone else to provide that much of the user-experience is a brittle proposition for a business.

jpcorica• 10 years ago

How can we balance effort, risk taking and authorship protection vs holding progress back because of the blocking some patents create? Product revenue will be enough?

liseman8• 10 years ago

Usually, abstractions like this serve as excuses to not launch. Launching doesn't fix everything, but it does increase your speed of learning dramatically.

Hykso15• 10 years ago

Somebody once told me: you'll deal with patent infringement once you're successful, which is already a big milestone...so to try to get there first.

shishir1• 10 years ago

When is the right time/scale to start knocking doors to find partners at schenzen?

drabie12• 10 years ago

Not sure there is a black and white answer to this, but that piece of the puzzle takes time. When you're getting close to a prototype that you think is manufacturable (and that is a big assumption that you should vet as much as possible), start reaching out to partners and CMs.

thebiglebrewski2• 10 years ago

Would it be possible to post links to all of the crowdfunding campaigns and/or product pages?

liseman8• 10 years ago

See http://www.ycombinator.com/hardware for current campaigns + products actively shipping. Nebia et al aren't on the list: companies get dropped post-crowdfunding and re-added when shipping:)

pwinter2810• 10 years ago

You can learn more about the Nebia shower at nebia.com

creativecomm22• 10 years ago

We want to talk to Tovala about a partnership

drabie12• 10 years ago

Cool. Shoot us a note - hello@tovala.com.

thebiglebrewski2• 10 years ago

I have a bunch of hardware stuff lying around. Arduino kits, soldering equipment, even a pocket oscilloscope! I had good intentions with it but now it's mostly just sitting there. Any small cool project ideas to build? Also I always have this problem where I'm missing one tiny component (I live in NYC in Brooklyn) and have to run to a store in Manhattan or wait for an online order to fill it...any tips on things to keep around that everyone should have (I have different types of resistors, etc).

Mostly I feel like a software guy that's a bit of a hardware wannabe and it feels like I'd never get to the point where I could build a legit product, and would love some guidance on how to ideate in this space.

liseman8• 10 years ago

Check out the common part libraries released by Octopart / Seeed , and consider getting a resistor / cap library from your neighbors at Adafruit. Hackerspaces can be good resources for spare parts (and finding potential partners).

You're in luck: prototyping is mostly software:)

Hykso15• 10 years ago

A hardware cofounder :D

zeeshanm2• 10 years ago

You should def go to NYC Resistor in Brooklyn. They have open hack nights every Thursday evenings. http://www.nycresistor.com/

spacebug2• 10 years ago

Try doing some connected device, esp8266 that turns on an led when you POST to a server (minimal soldering maximal programming). And develop from there. Also there are a lot of tuts for this things. Later try to integrate some sensors. A lot of hardware today is software inside a plastic box.

lindseya4• 10 years ago

What do you plan to do as a next step post-crowdfunding (other than delivering your product, of course)?

pwinter2810• 10 years ago

Build a really great product! We envision improved versions of the shower, and after that other products that use water in the home. The product development cycle is realistically 18-24 before you get something to market, so it is a long timeline.

drabie12• 10 years ago

Most important is to deliver our product (both hardware and food). However, we'll also be able to run some testing on our website to see what content/messaging/copy converts best into additional pre-sales.

We (Tovala) will also be hiring for some software, operations and food roles :)

Hykso15• 10 years ago

Product development and improve our sales cycle/customer acquisition cost!

mbruschi3• 10 years ago

How do you managed to get your campaign to the press? Any advice if there is no time for building up relation-ships with the journalists?

drabie12• 10 years ago

The best option is to get warm introductions and develop relationships early. Getting people to hear about your product, give you feedback and feel invested before you launch is critical.

However, that's not always possible. If you're scrambling and haven't had time to do that, you can always reach out blind or use services/agencies to help. There's a YC company called PRX that helps with this and does it at a very affordable price. Another cool site that was on Product Hunt recently ranked a bunch of media outlets - http://presshour.co/?ref=producthunt. Lastly, take a look at your competition and who covered them - those are probably your best targets.

mbruschi3• 10 years ago

Thank you, will check that out! Did you sent the whole story in the first reach-out or how much information do you recommend to send the first time?

nappy3• 10 years ago

I recommend doing as much as you can to automate and scale your outreach to the press. I recommend Pitchbox.com for this - it's a sort of CRM for press outreach. It takes some time to set up, but it's worth it. Great support, too.

mbruschi3• 10 years ago

Thanks. Already tried pitchbox. Did you sent the whole story in the first reach-out or how much information do you recommend to send the first time?

dookahku• 10 years ago

I've lots of embedded linux experience. It's less consumerist products but more embedded systems experience.

Where do I find people's problems to solve that can be addressed by HW?

nappy3• 10 years ago

I'd start with thinking about things you deal with as a consumer and have problems with. After that, start asking other people about their experience with the same problem/issue.

Hykso15• 10 years ago

What about a problem that you wish you could solve for yourself?

zeeshanm2• 10 years ago

I would say do lots of market research. See what kind of products are in top demand in your niche and if you have time commitment to deliver.

cbw52• 10 years ago

Great hardware has the tradeoff of being "built to last" but then not re-engaging the customer for new purchases for quite some time. How do you think about re-engaging customers who purchase a Nebia shower?

pwinter2810• 10 years ago

Great question. Fortunately showerheads are often something that people need more than one of for different bathrooms in their home. So if they like one, hopefully they will buy more.

Further to that we have plans for making the Nebia experience more customizable. And so in future versions there will be features that allow you to make the experience even more personal, and these will allow for repeated brand interactions with the customer.

zkirill2• 10 years ago

Is it a good idea to sell your first small batch of functional prototypes as-is while still in the market research stage to get user feedback?

drabie12• 10 years ago

Depends on what you are trying to prove. If there are questions as to whether people will pay for your product, then yes, proving that that is the case with a functional prototype will go a long ways. If, however, you are trying to get feedback, build up brand evangelists and learn, then selling your prototype is not hugely important.

zkirill2• 10 years ago

Thanks!

dfox2• 10 years ago

By selling few our of prototype units we got both meaningful feedback and evangelists (not consumer, as the thing itself is mostly useful for government institutions).

On the other hand we also got interesting support headaches, as the final production version includes all the feedback and thus is completely different in overall architecture, hardware and software and thus probably only thing that is compatible are pinouts of I/O connectors (and voltage levels on them are only mostly compatible).

Hykso15• 10 years ago

Hell yeah! You'll learn tons especially what you should build and refine about the product!

cbw52• 10 years ago

Great hardware has the implicit trade-off of being "built to last" and consequently not requiring the customer to upgrade the product for quite sometime. How do you think about re-engaging customers in the short to medium term?

drabie12• 10 years ago

Great question. With Tovala, our model is a little different. We anticipate most of our customers will order our meal delivery service - and be delighted by the experience and taste. That'll give us a touch point to our customers throughout the life of their smart oven.

dfox2• 10 years ago

What is your approach to low-volume prototyping? Do you use same components for prototypes that you intend for volume manufacturing? How do you source them? (for example LCD panels, where there seems to be nothing in the intersection of "long-time available", "available in unit quantities", "available in bulk" and "reasonable quality")

And another question for the business side of things: where is the line for consumer products that are not meaningful to crowdfund? niche-ness? complexity of installation? does it make sense to crowdfund what is essentially an B2B product?

wilcoxbr3• 10 years ago

We approach prototyping as a process. http://www.themacro.com/articles/2016/01/minimum-viable-prod...

Early prototypes use whatever we have laying around to get the most fundamental feature of the idea vetted.

Right before production, you will build a prototype that we call a First Article. This is a Golden Sample, and every production unit should be just like the First Article.

Prototypes in between those two are built to answer specific questions and we spend no extra resources on sourcing special components that do not directly impact accurate answering of the question.

For things like displays, wireless modules, etc. we work with the manufacturer's Field Application Engineers. They can get you insight on what will be available for production, documentation for the components, etc. They can also probably get you samples for your development work.

McMaster-Carr, DigiKey, Mouser, AdaFruit, SparkFun, etc. are your friends for making those early prototypes.

Crowdfunding is essentially pre-ordering on a social platform. If your market is there and interested, crowdfunding can be a viable market validation step for any business model.

ogreveins• 10 years ago

Serious question: How do you keep your stuff from getting replicated, tweaked and crushed by people with possibly better tooling and more machines than you? China comes to mind tbh.

drabie12• 10 years ago

Honestly, you don't. You just need to focus on building something that people want and making sure that the experience you deliver is better than any other.

Further, if you start to think about your hardware as a means of delivering something else (for us, that's food), then getting copycatted on the hardware won't be as hard to deal with from a business standpoint.

Hykso15• 10 years ago

+1 with the boys above! By the time someone replicates you, you should have an improved version of your stuff on both software and hardware.

pwinter2810• 10 years ago

This is a common concern amongst all founders I'm pretty sure. It certainly was for us at first. But it shouldn't be. Most people have their own problems to worry about. Obviously it depends on what stage you're at. If you are "pre-market", that is, if you haven't shipped yet. I wouldn't worry to much about it. Just focus on making it better than anyone else and understanding what your customers or potential customers actually want, from an end-to-end experience. It's unlikely that someone with better tools and more machines will ALSO be scrappier and learn to understand their user better and execute on all of those fronts better (I'm thinking customer service and e-commerce for example).

I would focus less on being replicated, and focus more on handling your own issues. Another way to think about it is if you get to the point where you product is good enough and with enough attention that it gets copied in a serious way, you've clearly achieved something.

Cover your bases with IP and be smart, but just focus on getting the best product to market fastest and delivering a great customer experience.

cfort6• 10 years ago

Lots of platforms exist for home automation, control of IoT devices, etc... HomeKit, Nest, Wink, etc.

How worth it is it to integrate with these platforms? Should new IoT devices "cover all the bases", or is it not worth the extra cost & development?

Currently I'm doing an IoT project and I think I may just skip all those platforms. The HomeKit app costs $14.99, a Wink base station or a Nest costs money... Personally I'm doubtful consumers want to pay those extra costs.

Thoughts?

liseman8• 10 years ago

I believe we're in the earliest days: there's no dominant platform, and no 'killer use' for home automation / iot. I'd focus on your product, maybe adding support for platforms later.

louprado4• 10 years ago

Our company is going with HomeKit since the high-bar of entry means you will compete with less companies. We recently received our MFi Manufacturing license which means we can procure Apple's authentication co-processor and submit product plans directly to Apple.

If anyone has a startup working on a HomeKit product please e-mail me... louprado at gmail.com. Perhaps we can be of service to each other. I am in downtown Oakland.

cfederico2• 10 years ago

Hi Guys, we are a hardware startup developing a smart LED lamp. We plan to launch a Kickstarter campaign late Q3 and now we are testing the product with our early adopters.

- What is the best way to get traction on the product before launching the campaign?

- How much money you need to set up a good marketing Kickstarter campaign ? Is it needed to use a good PR agency ? (Any suggestions about a good PR agency ? )

Thank you so much!

Federico

Hykso15• 10 years ago

Build an email list! And try to pump up the subscriptions with different sales channels - you'll be able to know which ones work best for your business before launching your campaign

thirru8• 10 years ago

What was the best way for you guys to grow your email list (aside from paid ads)? Did you use Queue?

noer• 10 years ago

I'm going to have to disagree with part of this. Collecting emails is a good strategy when there's a concrete availability date and that date isn't too far off from the present. I recently had a client who was trying to sell a similar(ish) product. Collected emails for 6+ months. When they announced that their product was available, it took them 3 months to get to 50 orders from nearly 10k emails. Looking back, keeping the email subs engaged might have helped increase conversion from subscriber -> customer, but It ended up not working out nearly as well as we had hoped.

cfederico2• 10 years ago

Gotcha! So, we could start collect email with our first early customer interviews and then email them once we open the pre-order campaign ?

- About Hykso, which sales channels worked better ?

- Is it better to launch a pre-order campaign on our website, before launching the Kickstarter campaign ?

Thank you

liseman8• 10 years ago

Hire a PR agency halfway through your campaign when you're so overwhelmed with backers and attention that you can't handle it yourself. Until then, DIY:)

gabsong2• 10 years ago

During crowdfunding, we're busy taking orders, talking to press, making sure we update our users with marketing campaigns, etc. How do you manage customer care during the time of the campaign?

pwinter2810• 10 years ago

It's really important to have a plan for this. We were not prepared and got blindsided and it took basically the whole teams effort for a couple of days before we systematized it.

Here is a direct quote from the guy who set up and manages our customer service system "be meticulous but also efficient".

The best platform we've used is "Front" also a YC company. Clean and super fast interface.

gabsong2• 10 years ago

That's great. Thanks for the sound advice -- we'll also look into it :)

thirru8• 10 years ago

I have a question for Hykso: You guys had a progress bar of units sold. Did you see that this was creating urgency? Also did you find it hard to create traffic to your own site? What was your strategy? And why Shopify over Tilt/Celery?

Hykso15• 10 years ago

No we did not see it had much of an impact. But what we saw had the biggest impact is our website! We refined it a lot based on customer interviews to make sure to convey the worth of the product (which was lacking in the previous version). Also customers had a lot of questions, which is not good for sales. As soon as we put the new website up, sales increased!

thirru8• 10 years ago

Interesting.

1- Was there a reason why you chose not to use a promo video? 2- What has been main driver in sales so far? Like what was the split between PR, Email List and Ads? Any other channels? 3- Why Shopify over Celery/Tilt then? Did it give you more control over the experience?

Sorry lots of questions. We are currently deciding between selfstarter vs crowdfunding.

-Martin

thirru8• 10 years ago

Hey Martin from ShapeScale (S15) here.

Did any of you attempt any influencer marketing? (celebrities or connectors on Instagram, Twitter, Facebook, Snapchat)

If so, how well did it work and did you pay them (if so what was the model, commission, or up-front payment). Would you do it again?

drabie12• 10 years ago

We thought about it, but ultimately it was too expensive and we weren't able to find the right influencers that fit with our brand.

Hykso15• 10 years ago

Hi Martin,

We actually went through some influencers on our side (known fighters or coaches).

It definitely helped gain a lot of credibility on our end because if it was that much of a revolutionary product, why would pro athletes not use it amd endorse it. so for us it helped a lot convince our customers that it was a legit product.

However, we have been offered to post on a few famous people pages for 5k but we didn't do it as we thought it would actually be seen as paid advertising instead of genuine and authentic love for the product. We're still exploring those avenues though.

pmalynin• 10 years ago

"why would pro athletes not use it amd [sic] endorse it",

Well, you could have paid them.

creativecomm22• 10 years ago

We want to partner, contact us foodbyprint at gmail.

thirru8• 10 years ago

For those of you that did Kickstarter and not Indiegogo or a selfstarter (Celery/Tilt/Shopify) campaign:

How happy were you with the experience so far? There are a few up and downsides as drabie had mentioned before.

Taking all of that into account, would you use Kickstarter again if you had the choice again?

pwinter2810• 10 years ago

Yes, we would use Kickstarter again. It drove a lot of our traffic and the community of backers seems to have a unique cohesion. People on KS know what they are getting in to, and are there to help. It has it's downsides, but in my opinion the pros outweigh the cons.

I think each company is different though, and you have to consider your strengths, as in do you have a strong online acquisition strategy/team, in which case a campaign on your own site may make more sense.

Now that our campaign is over we use Celery for pre-orders on nebia.com

thirru8• 10 years ago

What are some good strategies you guys used to narrow and improve your messaging for your crowdfunding campaigns?

Did you rely on qualitative feedback (by real people or usertesting) or on quantitative results (A/B conversions testing on ad copies and landing pages)? Or did you just go with your gut?

drabie12• 10 years ago

I would do both qualitative and quantitative. 100%. That's hugely critical.

joshavant3• 10 years ago

Hi folks!

I graduated from a moderately-ranked undergrad program with a 3.0 in Computer Engineering (the HW-centric flavor of CS), going on 6 years ago.

After graduation, I wanted to get into the embedded field, but was discouraged by the employment options (hardware hadn't yet made the comeback it has been making over the last 3-5 years... 'old' players like Intel still dominated, which wasn't particularly attractive to a bright-eyed 21 year old).

In the interim 6 years, I've been doing iOS development, and believe I've amassed a CV that speaks well to my dedication and work ethic (and is moderately accomplished, at that!).

My question is... how far off am I from being a viable candidate for embedded job opportunities? What kinds of projects/side-work would you like to see to prove that I 'still have it' and/or could sufficiently think on my feet, and get back into embedded development?

FWIW, I have resume experience at Apple, Microsoft, and Google (I actually was hired at Apple out of college to do hardware QA but, once I realized the path from QA to embedded development would be a near impossible feat, I quickly moved on to iOS development).

Thanks! And good luck with your respective products!!

liseman8• 10 years ago

Build things you want for yourself and publish them. Don't worry about cost optimization, production at scale, patents, etc.: just make something with unique functionality. Repeat. You'll be pleasantly surprised how quickly you learn and amass a portfolio of unique toys:)

joshavant3• 10 years ago

Thanks!

Hykso15• 10 years ago

The best candidate we had just asked us to work for free for a month to see if we would like him. We could not say no. And today he's a co-founder :D

RoyTyrell• 10 years ago

I guess your candidate was ok with volunteering, but it seems like that would very likely violate tax and/or labor laws or IRS regulations.

FUSAR_rs• 10 years ago

Where are you based? We're currently looking for someone with iOS experience and a desire to get into embedded HW.

joshavant3• 10 years ago

Los Angeles, and curious to hear about the opportunity regardless of where it's located! Contact information is in my HN profile. Please get in touch!

liseman8• 10 years ago

Lots of great questions! Thanks for joining us. Email me ( luke@ycombinator.com ) after you apply for YC with your next big hardware thing:)

anujdeshpande2• 10 years ago

A lot of the advice seems to be geared towards B2C startups. Most startups http://www.ycombinator.com/hardware/ seem B2C too. A lot of the reports/blogs/opinions of the Interweb suggest that connected hardware will make the most sense in industrial and smart city kind of environments (which are probably more B2B than B2C) in the early days. Would you advise differently for people working on B2B?

- Getting early prototypes out there has kind of been decremental for us. Even the smaller bizs are willing to pay higher for a more "field-tested" device. Which seems like a recursive problem ;). Should one spend more time on getting v1.0 done ? - Is there anyone who you'd recommend to handle global shipping and taxes? The way that Pebble had tied up with distributors in different places depending on your country, etc.

(We are building talking posters. One's with BLE play prerecorded messages, and you can interact with them, and the one's with WiFi are connected to the Internet and are more interactive.)

Thanks !

erohead• 10 years ago

- stick through it! You should be able to find early customers who are willing to work with early prototypes, even when asking them to pay. Just make sure you give them insanely good customer support. Consider flying out to get them set up! Don't wait til v1.0 to sell, get out there sooner.

- I'd recommend sticking to a local fulfillment service that has great customer support for your early shipments. There is absolutely no need to optimize for cost in the early days. Just make sure you have someone you can call to sort out shipment delays, lost packages, etc. You can always expand to more fulfillment centres later.

Sounds like a cool idea! Are the posters epaper or static?

anujdeshpande2• 10 years ago

Static for BLE as we do a battery pack kind of a thing and don't want to do something very power intensive. The WiFi one's are 2 types, RGB panels, as well as static posters with capacitive touch in certain regions (apart from the voice).

grape_2• 10 years ago

YC and many other incubators provide startups technology incentive programs (Digital Ocean providing $250k credits, Azure providing $500k in credits, etc.). Are any of the hardware startups here utilizing any of the incentive programs? If so, how so? Very interested to hear about cloud strategies, especially as they relate to hardware companies (APIs, IOTs, etc.).

jonesb6• 10 years ago

From my brief research digital ocean only provides credits to YC companies unlike Microsoft, Azure, and even IBM's SoftLayer. I'd just like to point that out. That immediately disqualifies DO for large cloud products due to their pricing and product offerings.

grape_2• 10 years ago

You're absolutely right. I haven't really read through many of the DO use cases, so maybe I can start there. But, Microsoft also has a separate program for YC ($500K instead of $60k I believe for startups outside of YC). And I know Amazon and Google both have programs that are not exclusive to YC ($100k both). I'm very curious to see how hardware companies are using cloud, and if these incentives are even working.

prbuckley• 10 years ago

How much do you think about a post crowdfunding customer acquisition strategy before launching a crowd funding campaign? It seems like crowd funding can get initial attention but doesn't necessarily make a sustained business.

dchmiel• 10 years ago

What is your approach to looking at security for your hardware and data during prototyping and testing with early clients? How would you minimize what data is collected to maximize what you can learn to improve your product and service?

martinushk• 10 years ago

Hi guys. What did YC helped you the most with? I guess none of you had the product on the market while being in the batch (maybe I'm wrong?).

dalanmiller2• 10 years ago

Would also like to hear this.

louprado4• 10 years ago

Last month my hardware start-up was almost shut down because our power supplies are CEC efficiency level 5 and not 6. Customs would have seized our entire last shipment. Prior to that I got a cease and desist from the Bluetooth SIG unless I immediately paid $2500 to $10000. I paid immediately.

I have no problem following regulations and paying for licenses. The problem is getting blind-sided by it. I still don't even understand if I need a RoHS certification to ship in my home state of California. Is there any resource you found helpful ? Thanks in advance.

JonFish852• 10 years ago

"I have no problem following regulations and paying for licenses. The problem is getting blind-sided by it. I still don't even understand if I need a RoHS certification to ship in my home state of California. Is there any resource you found helpful ? Thanks in advance."

At least in my own work this has been something that pops up time & time again. Not only are there regulations that are tricky to nail down, there are things like intellectual property that you may not even be aware you're using. Build a blinking LED to detect activity on a data line? Wouldn't be surprised to receive a letter from a law firm. And unfortunately I don't know of any great ways to avoid the nasty surprise of receiving patent-backed threats. Personally I think this is why the big companies bulk up on patents, so that they can at least promise Mutually Assured Destruction against each other. For smaller companies & people selling products, you're probably infringing on some patent that they own without even realizing it.

louprado4• 10 years ago

Random IP lawsuits aside, there are known agencies/certifications/requirements, etc that may eventually require compliance. Here's the ones I know:

RoHS, CEC?, UL, FCC, Wifi Alliance, Bluetooth SIG, please add if anyone else knows.

I get that the OP is about pre-release startups and the general advice is "don't worry certifications; just ship". But this became a problem just 90 days after our product launch. Had the timing been worse it could kill a new company.

dalanmiller2• 10 years ago

Does your device use bluetooth in a special way or just general purpose Bluetooth usage? Did you have to pay that much just to put the "Bluetooth certified" logo somewhere?

louprado4• 10 years ago

You could owe licensing fees just by putting the word Bluetooth on your website. We didn't have the Bluetooth Certified Logo anywhere and still don't.

If your App uses Bluetooth the fee is around $100 per platform, but since it is a hardware product (my product, GarageMate, is a garage door opener App), the payment due is much higher. It doesn't matter if you are pre-release. And if you change the chipset you have to pay again. Note, you could save a few thousand by using a pre-certified module.

FYI, the Bluetooth SIG's enforcement lawyer called right after I signed up for their free membership using my company e-mail address.

Undertow102• 10 years ago

Can you elaborate more on the events that led up to customs potentially seizing your power supplies? We have heard shipments for other companies have gone through with no problem.

Undertow102• 10 years ago

For what it's worth, here is an excerpt from the Bluetooth SIG agreement that you probably accepted when signing up on their site:

"BLUETOOTH TRADEMARK LICENSE AGREEMENT

This Bluetooth Trademark License Agreement (the “License”) is made as of the date of acceptance by you as a member of Bluetooth SIG, Inc., a Delaware corporation (“Bluetooth SIG”), as evidenced by you entering into the Bluetooth SIG Membership Agreement by clicking the “I Accept” button at the bottom of the Bluetooth SIG Membership Application and Commitment Agreement.

Effective upon such date, Bluetooth SIG, having ownership of the Bluetooth Trademarks (as defined below) hereby grants you the following rights related to such Bluetooth Trademarks in consideration for your acceptance of the terms and conditions of the Bluetooth SIG Membership Agreement."

....

"2 LICENSE GRANT. 2.1 Scope. Subject to the Member complying with the terms and conditions of the Membership Agreement, this License and the Instructions, Bluetooth SIG hereby grants Member a worldwide, royalty-free, non-exclusive, nontransferable (with no right to sublicense), personal right to use the Bluetooth Trademark(s) in relation to production, manufacture, supply, promotion, marketing, sale, lease or other distribution and advertisement of Bluetooth Services and/or Bluetooth Products that include Compliant Portions (the “Trademark License”)."

jonbarker• 10 years ago

What are some cost effective options for rapid prototyping (preferably mostly doing it myself in a shop type environment) in the bay area?

fudged71• 10 years ago

There are lots of hackerspaces/makerspaces in the bay area! Plenty of equipment available for next to nothing.

spacebug2• 10 years ago

What is Your thought on shiping prototype stage products to early backer as a way of getting user feedback. Even if product is not yet certified, with the promise that you will ship them the finished product?

This way you are not selling the product you shipped them, so I'm not sure what are regulations regarding this strategy. The product would be clearly labeled as prototype version and not fit for end use.

Bonus points for complexity: The product is intended for children age 6+.

rdl• 10 years ago

What do you do when a hardware startup/kickstarter/etc. has raised, say, $150/unit, but needs $250-300/unit to ship? I se this a lot with crowdfunded projects -- either they underestimated costs, or had a single huge setback.

compumike• 10 years ago

The answer is basically that the company dies and customers get nothing.

We (Pantelligent, YC W13) did a Kickstarter, then successfully shipped to customers, and are now transitioning to normal orders. Our actual production costs and timeline were within ~15% of our before-the-fact spreadsheet estimates, but then again, we were experienced engineers who know how to ship hardware & software products, which is quite unlike most new entrants.

Just within the "temperature controlled cooking products" space, I could name a bunch of "competitors," but not a single one besides ourselves has shipped, with the exception of the existing sous-vide field which has had more time to develop and is fairly simple from an engineering perspective. Most of these products will likely never ship.

Sadly, crowdfunding usually leads to dramatic overpromising on features (some of which are not even manufacturable!), and severe and unsustainable underpricing, in order to drive pre-orders. That's just a recipe for disappointed customers and dead companies.

elijahparker2• 10 years ago

I'm just about to launch a new hardware product and was planning on using Kickstarter (it would be my 2nd time), however a partner (and reseller) in the industry brought up the option of them preordering my entire Kickstarter goal so I can get to selling/shipping the final product sooner at retail price.

Seems like an enticing option, my main concern is how much of the Kickstarter market might I miss?

Are people who buy on Kickstarter a subset of those who buy a finished product, or is it an entirely separate group?

I can see pros and cons of both ways, and I know a lot has to do with my specific market (niche time-lapse), but would love to hear any comments or insight. Thanks!

MechSkep• 10 years ago

I have a plan for overhauling/replacing Geometric Dimensioning and Tolerancing. The way it's done now consumes way too much design time, and honestly is a bit silly considering the inputs and outputs of the system.

I'd like to talk to someone with experience interfacing with factories in China about how the current approach could be replaced. Any suggestions?

Also, if I developed this tool-chain, what is the best way to attach to the market?

elijahparker2• 10 years ago

Does anyone have a recommendation for how to go about WEEE [1] compliance across Europe apart from registering in every country individually?

[1] https://en.m.wikipedia.org/wiki/Waste_Electrical_and_Electro...

gourneau• 10 years ago

Is building an IoT product based on the ESP8266 (esp-12e) a reasonable thing to do? Would there be any hidden fees or licensing issues?

franciscop• 10 years ago

I won a worldwide NASA contest with a friend designing and building a Space Helmet in a weekend [1] and my friends won two of the Hyperloop categories [2]. We have created a community of students [3] in our University in Spain and now we are launching a robot competition [4].

Would you consider sponsoring our community or the contest? We are operating with a budget under 1000$. Both money and products would be awesome :D

[1] https://2014.spaceappschallenge.org/awards/#globalwin Next Vision (Space Helmet)

[2] http://hyperloopupv.com/

[3] http://makersupv.com/

[4] http://orchallenge.es/

dsl• 10 years ago

I'm currently considering a startup that is 90% cloud software, and 10% on site hardware (think a small custom designed sensor).

Having no experience or expertise in custom hardware design, how would you recommend finding someone who could handle design and production?

milani• 10 years ago

What is the process choosing a manufacturer? How do you choose between them? Another question is, do you outsource the production to an EMS? If not, how one should handle assembling parts and packaging the product?

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