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The Hardware Startup

Book Description

Thanks to the decreasing cost of prototyping, it's more feasible for professional makers and first-time entrepreneurs to launch a hardware startup. But exactly how do you go about it? This book provides the roadmap and best practices you need for turning a product idea into a full-fledged business.

Written by three experts from the field, The Hardware Startup takes you from idea validation to launch, complete with practical strategies for funding, market research, branding, prototyping, manufacturing, and distribution. Two dozen case studies of real-world startups illustrate possible successes and failures at every stage of the process.

  • Validate your idea by learning the needs of potential users
  • Develop branding, marketing, and sales strategies early on
  • Form relationships with the right investment partners
  • Prototype early and often to ensure you're on the right path
  • Understand processes and pitfalls of manufacturing at scale
  • Jumpstart your business with the help of an accelerator
  • Learn strategies for pricing, marketing, and distribution
  • Be aware of the legal issues your new company may face

Table of Contents

  1. Preface
    1. Who This Book Is For
    2. How to Use This Book
    3. Safari® Books Online
    4. How to Contact Us
    5. Acknowledgments
  2. 1. The Hardware Startup Landscape
    1. Early Makers
      1. The Whole Earth Catalog
      2. Communities Around New Technology
      3. MIT Center for Bits and Atoms
      4. Make Magazine
    2. Technology Enables Scale
      1. Rapid Prototyping
      2. Inexpensive Components
      3. Small-Batch Manufacturing
      4. Open Source Hardware
      5. Online Community
      6. The Supplemental Ecosystem
      7. The “Lean Startup” and Efficient Entrepreneurship
    3. The Hardware Companies of Today
      1. Connected Devices
      2. Personal Sensor Devices (Wearables)
      3. Robotics
      4. Designed Products
  3. 2. Idea Validation and Community Engagement
    1. Your Fellow Hardwarians
    2. Your Cofounder and Team
    3. Your Mentor(s)
    4. Your True Believers and Early Community
  4. 3. Knowing Your Market
    1. The Who, What, and Why of Your Product
    2. Researching Your Market: Trends and Competition
      1. Market Size
      2. Market Trajectory
      3. Market Analysis
      4. Differentiators
    3. Segmenting Your Market
      1. Customer Aquisition Cost (CAC) and Lifetime Value (LTV)
      2. Demographics and Psychographics
      3. Behavioral Segmentation
    4. Customer Development
  5. 4. Branding
    1. Your Mission
    2. Brand Identity and Personality
    3. Brand Assets and Touchpoints
    4. Positioning and Differentiation
  6. 5. Prototyping
    1. Reasons for Prototyping
    2. Types of Prototyping
      1. Prototyping Terms
      2. Works-Like and Looks-Like Prototypes
      3. Teardowns
    3. Assembling Your Team
      1. Industrial Design
      2. User Experience, Interface, and Interaction Design
      3. Mechanical and Electrical Engineering
      4. Software
    4. Outsourcing Versus Insourcing
      1. Outsourcing
      2. Insourcing
    5. Integrated Circuits
    6. Connectivity
    7. Software Platforms
    8. Software Security and Privacy
    9. Glossary of Terms
      1. Prototyping and Manufacturing Processes
      2. Electrical Components
      3. Sensors
  7. 6. Manufacturing
    1. Preparing to Manufacture
    2. Where to Manufacture?
    3. Supply Chain Management
    4. Importing from Foreign Manufacturers
    5. What to Look for During Manufacturing
    6. Certification
    7. Packaging
    8. Sustaining Manufacturing
  8. 7. Acceleration
    1. Lemnos Labs
    2. HAXLR8R
    3. AlphaLab Gear
    4. PCH
      1. Highway1
      2. PCH Access
    5. Flextronics
    6. Choosing an Incubator or Accelerator
  9. 8. Crowdfunding
    1. The Crowdfunding Ecosystem
      1. Kickstarter
      2. Indiegogo
      3. The DIY Approach
    2. Planning Your Campaign
      1. Understanding Backers and Choosing Campaign Perks
      2. Pricing Your Perks
      3. Creating a Financial Model
      4. Timing with Manufacturing
    3. Campaign Page Marketing Materials
    4. Driving Traffic
      1. Leveraging Social Media and Email Lists
      2. Connecting with the Media
      3. Organizing PR Materials
    5. While Your Campaign Is Live
      1. Data-Driven Crowdfunding and Real-Time Adaptation
      2. Publishing Updates for Your Community
    6. Beyond Crowdfunding: Fundraising for a Company
  10. 9. Fundraising
    1. First Things First
    2. Bootstrapping, Debt, and Grants
    3. Friends and Family
    4. Angel Investors
      1. The JOBS Act
      2. AngelList
    5. Venture Capital
      1. Targeting Investors
      2. Personalized Introductions
      3. Telling a Story
      4. Due Diligence
    6. Strategics
    7. Structuring Your Round
  11. 10. Going to Market
    1. Business Models for Hardware Startups
      1. Selling Additional (Physical) Products
      2. Selling Services or Content
      3. Selling Data
      4. Open Source
    2. Pricing
      1. Cost-Plus Pricing: A Bottom-Up Approach
      2. Market-Based Pricing: A Top-Down Approach
      3. Value-Based Pricing: Segmentation meets Differentiation
    3. Selling It: Marketing 101
      1. Step 1: Define your Objective
      2. Step 2: Choose your KPIs
      3. Step 3: Identify Your Audience, the “Who”
      4. Step 4: Select Your Marketing Channels
      5. Step 5: Formulate Your Message
      6. Step 6: Incorporate a Call to Action
      7. Step 7: Specify a Timeline and Budget
      8. Step 8: Refine Your Campaign
    4. Distribution Channels and Related Marketing Strategies
      1. Online Direct Sales
      2. Online Specialty Retailers and Retail Aggregator Platforms
      3. Small Retailers and Specialty Shops
      4. Big-Box Retail
      5. Warehousing and Fulfillment
  12. 11. Legal
    1. Company Formation
    2. Trademarks
    3. Trade Secrets
    4. Patents
    5. Manufacturing Concerns
      1. Liability
      2. Manufacturing Agreements
      3. Import/Export Considerations
    6. Regulatory Concerns and Certification
      1. Medical Devices and the FDA
      2. Hardware and the FCC
  13. Epilogue: The Third Industrial Revolution
  14. Index