Being a founder of a hardware company is no easy task. We asked four founders to share their insights, so others in the same position can pick up on their learnings.

Jan. 12, 2022 / 7 min. read

4 Leading Hardware Startups Share Their Insights

Being a founder of a hardware company is no easy task. 

At TechBBQ 2021, we partnered with SOLIDWORKS to put the next wave of promising startups on stage for ‘Playground for Hardware Startups’. We did a Q&A with four of these founders to extract their insights, so that others in the same position can pick up on their learnings.

PurCity ApS is a Danish based company founded on December 2017, aiming to improve the human’s quality of life by purifying Air in cities. 

Morteza Ghorbani Eftekhar, Founder and CEO of PurCity is the person behind the Company’s invention. He has born and raised in a location that has recorded as one of the highest Air pollution cities in the world. During his childhood, one of his best friends got lung cancer due to the high level of air pollution and passed away, which has significantly affected him. After that unfortunate tragedy, he has always had the ambition to find solutions for this problem and had several different ideas that led him to startup PurCity.

What are your top 3 pieces of advice?

1) "Network."
2) "Network."
3) "Network."

Q&A:

1: What are some of the most common challenges you face as a hardware company?

“Fundraising. Pandemic or such similar events. Conservativity of the market to new and out of the box products.”

2: From a founder perspective, what are some of the disadvantages of being a hardware company?

“More work for sure, but I believe in higher outcome as a result. Patents are advantages as well as costly and a disadvantage when it comes to the early startup stage. More difficult to run the test and validations before going to market.”

3: What would be your top 3 pieces of advice to a newly started hardware company?

1) “Network.”

2) “Network.”

3) “Network.”

4: Which accelerators, incubators, programs, funds etc. have you gone through and received soft grants from?

“We have received soft grants from the following:”

– Urbantech (111.534 DKK)
– InnoVEX International Pitch Competition (94.600 DKK)
– HKSTOP – Top 10 world’s best elevator pitch (38.400 DKK)
– 14BS Innovation 4 Blue Skies (6.400 DKK)
– Clean Cities – Stage 1 (37.178 DKK)
– Clean Cities – Stage 2 (175.000 DKK)​

A food-tech startup company on a mission to inspire the global community to adopt a healthier and more sustainable diet by developing innovative solutions for simple, enjoyable food preparation. We start with millo, the world’s smartest, quietest and safest blender, designed to fit our busy lifestyles.

What are your top 3 pieces of advice?

1) "Try a less complex business than to build a hardware company as your first startup."
2) "Remember your work-life balance."
3) "Always be two co-founders as a minimum."

Q&A:

1: What are some of the most common challenges you face as a hardware company?

“The biggest challenge is the overall complexity of the project. At the same time you need to develop a product, create an App (if it is a smart device), launch an e-commerce platform. Product development and certification is a long process, on average it takes up to 3 years. With that comes a much bigger need for investment. A rule of thumb is that it takes at least 1M Eur to launch a consumer electronics product.”

2: From a founder perspective, what are some of the disadvantages of being a hardware company?

“It is hard to really test the product market fit before you have an actual product, meaning that there are no quick shortcuts. So you have to commit at least for three years just to get the full picture whether it is worth it to pursue the idea.”

3: From a founder perspective, what are some of the advantages of being a hardware company?

“Working with a physical product provides tons of satisfaction being able to actually touch your creation. It is somehow magical to see how thoughts become real objects. There are usually quite a few design iterations until you select a final concept, at this stage everyone feels like a creator.”

4: What would be your top 3 pieces of advice to a newly started hardware company?

“Do not do it :)))”

1) “Seriously, if it is your first startup do something less challenging. There are so many things to learn. Once you have a good understanding of how things work in a startup, it is time to add that complexity. Team is the most important piece of the puzzle. So take your time to find the right person. From my experience, two core co-founders is the best ratio. Never be alone, but no more than three founders.”

2) “As you will grow with each investment your company shares will dilute, and if there are too many founders there will be no actual company owner.”

3) “Finally, do not forget to balance your life, spend some quality time with your family, friends. Founders first of all are innovators and it is all about creativity. In order to be the best version of yourself you need to take time to recover.”

5: Which accelerators, incubators, programs, funds etc. have you gone through and received soft grants from?

“We had one European grant to develop a concept of public access point for blending using the same technology of the magnetic air drive.”​

Vitroscope’s patent-pending flow-chamber and platform technology is designed with and for researchers. The company put a strong focus on making biologist’s work in the laboratory to flow as efficient and easy as possible. The solution requires no special tools and no special adapters and fits right onto all standard microscope stages.

What are your top 3 pieces of advice?

1)"Bring to your team someone who profoundly lives design thinking."
2) "Learn how to physically prototype with what you have in your office and leverage that to gain user insight."
3) "Find production partners that are capable of implementing your idea from 10 to 1.000 to 10.000 units."

Q&A:

1: What are some of the most common challenges you face as a hardware company?

“There are plenty of challenges but two that always stand out are: one, finding the right suppliers that are willing to take on small scale pre-production runs at a sufficient quality, at an acceptable price, without taking months for it; two, many investors somehow forgot that many of the most valuable companies rely on hardware – it may be more difficult and more expensive to develop up front, but to assume that hardware does not scale is a thing of the past. So we have some education to do on that end, which is not always easy.”

2: From a founder perspective, what are some of the disadvantages of being a hardware company?

“There are extremely many variables in hardware that you do not have to take into account with software. Tolerances, material compatibility, assembly methods, production methods, and, and, and.. And every error costs you money and production time, making it a very costly learning curve.”

“So, ultimately as a founder you really take on a massive challenge where you better understand how engineering works on many levels or you will be out of money real fast. You do not need to understand every detail, but you need to see the red flags before you pay for them.”

3: From a founder perspective, what are some of the advantages of being a hardware company?

“In a way you are entering a niche that certainly is difficult to navigate, but also quite unexplored since most people shy away from hardware. Even though it has never been easier to start a hardware company than today: the internet allows you to source parts from around the world in no time and local maker spaces help you prototype anything you want. Even the times of when any plastic part required tools for thousands of dollars up front are over thanks to high-end 3D printing services that scale to thousands of units.”

“Vitroscope is in that aspect in a really interesting position since both founders did their PhDs in a rapid prototyping laboratory and have built hundreds of prototypes and devices in their lifetime, so there is quite some hardware experience in the team. So, if you have the skillset to overcome most of the hardware challenges without requiring huge funding for consultants, you can start creating products that people do not switch away from that easily.”

“Your customers literally have an artefact of your efforts in their hands which retains them more in the ecosystem you create than e.g. a software subscription. Just think about when you last switched your phone OS vs. when you last ditched a messaging app.”

4: What would be your top 3 pieces of advice to a newly started hardware company?

1) “Get someone in your team that lives design thinking. Someone who did not just take a course, but someone who lives it and is truly passionate about the profession.”

2) “Learn how to physically prototype with what you have in your office and leverage that to gain user insights within hours, not months. Your local makerspace is a great starting point if you do not have that skill set yet!”

3) “Find production partners that are capable of implementing your idea from 10 to 1000 to 10’000 units and be willing to take the time this process takes.”

Here’s why: “Iterating hardware is expensive and can break your neck before you even get your product out. So you better make sure that you understand what your user needs (point 1), make sure your physical interpretation of a solution matches the user’s needs (point 2) and then do not fall for rapid “yes-I-can-manufacturers” but actually spend the time to make proper drawings and manufacturing instructions so that you never have to think about it anymore (point 3).”

5: Which accelerators, incubators, programs, funds etc. have you gone through and received soft grants from?

“I guess our biggest hardware incubator was the PhD studies, as mentioned above.”

“Other than that, we have received multiple stipends from:”

1: Norwegian University of Science and Technology
2: The Adolf Øien Fond

“as well as multiple grants from both”

3: Innovation Norway
4: Research Council of Norway.

“Thanks, Norway, we really appreciate it! :)”

PRECURE´s solution help companies prevent muscular strain and hereby create a healthier workplace, reduce costs and loss of productivity.

MLI® is smart wearable technology that measures and analyzes physical activity. The technology can be used to measure all functions and all employees over a long period of time. The dashboard gives you a complete picture of the strain.

It is an easy-to-use tool with great value to occupational health efforts. The user is informed immediately when the load is harmful, and “nudged” to change behavior. By doing so, it can help to prevent wear and tear.

What are your top 3 pieces of advice?

1) "Be user-centric."
2) "Fail fast - learn quickly."
3) "Be patient."

Q&A:

1: What are some of the most common challenges you face as a hardware company?

“I am known to say that we haven´t made it easy for ourselves. Software is difficult and when you add data and hardware to the equation, it become ridiculous. Joke aside, when developing hardware, the dimensions are just bigger and more complex. I am especially thinking of scope, time, money, and risk. Let me elaborate in the following question.”

2: How are these challenges different to other more “regular” companies?

“We don´t just need to develop something that works, but we also need to develop an amazing user experience. Otherwise, there is no chance for commercial success. So far, this is not so different from other companies, but the process, time, costs, and consequences are. Where software can be developed, tested, modified, and fielded within days or weeks, for hardware it is a different matter. And the mistakes take much longer to correct. This is why pretotyping and agile project management is crucial for us. I have also been surprised of the process and costs associated with production maturation. And once you have a product ready, the supply chain is complicated. Both up- and downstream. As an example is the current situation on the component market.”

3: What are some of the disadvantages of being a hardware company?

“With a physical product, there are regulatory aspect – like CE-marking or FDA approval – which again complicate matters. The more markets, the more complexity. And this bears costs. The area of intellectual property is for many startups another area, which we need to know. Patents and trademarks are for most entrepreneurs unknown territory, which require expert legal advice.”

4: What are some of the advantages of being a hardware company?

“But it is not all bad. For us, it was a conscious decision to include hardware. It gives us control of our product and the user experience versus if we were to use off-the-shelf solutions. In our case, it also give control and ownership of the data coming from our hardware. The reaction of our customers is also positive as they like the “all included” approach. It also have a positive effect during demonstration as most can relate to a physical product. This is good attention, but I am not sure it by default makes investors more eager.”

5: What do you need to be especially mindful of being a hardware company?

“You need to pay attention to the project management and be very focused on the users. Otherwise, you can end up burning your money way to quickly. Don´t work in isolation, believing that you know it all. Instead you should reach out, establish relations to research, other startups, subcontractors, and of course your customers and users.”

6: What would be your top 3 pieces of advice to a newly started hardware company?

“Be user-centric, fail fast – learn quickly, and be patient.”

7: Which accelerators, incubators, programs, funds etc. have you gone through and received soft grants from?

“We have been very fortunate in our journey as we have received support from many sides. We have participated in:

– Accelerator´s startup programme
– The Danish Tech Challenge
– NOME
– Invest Horizon
– Sund Vækst, and more.

“We have received financial support from:”

– Growth Fund Denmark
– Innovation Fund Denmark
– Fonden for Beskæftigelsesfremmende Initiativer på Bornholm,
– SMV digital
– EU

“and of course from our investors.”​

Read more