Hardware startups are becoming increasingly popular for all the right reasons. The right hardware can solve more consumer problems. Turning your product idea into a gadget that customers can actually buy is also a more manageable process than before.
Of course, you still need the right product idea to get started. On top of that, you still have to go through the process of bringing that product idea to the market. We spoke to investors with extensive hardware startup portfolios, and here are their expert tips for you to follow.
Refine Your Idea
Your first idea is not going to be THAT good, regardless of how you feel about it. Ideation needs to be a long and detailed process, especially since you will be investing a lot of resources into actually developing that idea into a hardware or a gadget.
This is where product design tools come in handy. Many of them are useful for running simulations, testing the idea behind the product, and taking that idea into its mature state. For example, you can use KiCad to design the electronics of your product, but KiCad isn’t the only tool to use.
You can now import KiCad to Altium to run simulations. Altium Designer’s built-in simulation tools are the most extensive. They allow you to check for details like component clearance, routing errors, and even the overall design of the board without making a prototype.
Aim at a Profit-Generating Market
One unique aspect of starting a hardware company is how you need to approach the market. Unlike software startups, hardware startups need to bear higher costs when taking their products to the market. The cost of R&D and prototyping alone can be substantial.
This means there is a bigger need for profitability. Cost elements must be managed from the beginning of the process. At the same time, your business plan must aim more for positive EBITDA rather than high company valuation.
The sooner you realize this, the higher the chances of finding an investor that actually believes in your product. When you have investors lining up to fund your company, you can bring your product idea to the market even faster.
Time to Market is Important
That brings us to the last tip which is to mind your time to market. Rushing to be the first on the market is sometimes necessary, but that doesn’t mean you can neglect some important steps along the way.
One step that a lot of business owners neglect is filing for a patent for the product, especially for products with custom PCBs and components. Holding a patent for your product allows you to capitalize on your idea without dealing with copycats.
Another step you don’t want to skip is creating product documentation and disclaimers. Make sure customers can enjoy the maximum value from using your product. Think about customer experience as you finalize the product before introducing it to the market.
With these tips in mind, entering the hardware startup landscape will not be difficult. Finding investors to back your product idea will be just as easy now that you know how to make your new startup more appealing to them.