A number of hot hardware startups are covered in a few other chapters in this book, and many are mentioned in chapter 6. For angel investors, hardware is a fun and adventurous space, because it covers so many niches. From gaming to home automation, you can find a hardware startup that address needs in almost any industry. Pebble, the Kickstarter darling, brings smartwear to the wrist, and Boosted lets urban dwellers get around quickly on a motorized longboard. Hardware even enters the tobacco market with companies such as Ploom, which used its ties with a Japanese tobacco firm to create sleek vape devices.
Let's look at a few other hot hardware startups and discuss why these companies are catching investor eyes, starting with:
Formlabs, launched in 2011, is an illustration of what happens when founder know–how meets impeccable timing. The company, which received $1.8 million in seed funding in November 2011, further drove its 3D printer product to market with help from a 2012 Kickstarter campaign. The campaign offered rewards ranging from a virtual high five and a file copy of the printer model to a package containing the actual printer plus fun printables. In its Kickstarter campaign, Formlabs claimed it intended to disrupt the 3D printing market with an affordable, high–quality 3D printer.
The startup was able to garner additional funding in 2013, when a Series A round brought it $19 million for product development and expansion. It's not surprising investors were happy to get in on funding Formlabs. By that time, it had already made good on a number of its Kickstarter promises; by December 2013, Formlabs had fulfilled all the Kickstarter rewards and shipped more than 1,000 of its Form 1 3D printers throughout the globe; this hardware startup had a strong execution plan.
Why all the hype around Formlabs' product? First, Formlabs' Kickstarter project, came at a time when 3D print technology was becoming a household topic. News media was covering the technology, which sounded futuristic and frightening to many–op–eds asked "What if people print guns?" and entrepreneurs bubbled excitedly about manufacturing concepts. For many users, though, the technology was entertaining to consider, but far from daily reach.
Formlabs' Kickstarter campaign meshed with the audience because it made the concept relevant, less frightening, and affordable. For $2,299, a backer received the printer and some supplies. With businesses paying a thousand or more for copy machines, that price for a 3D printer opened the technology to small business users and individual inventors.
That covers product and branding, but for the angel investor, the people behind FormLabs are also an attractive investment. Natan Linder managed Samsung's R&D center in Israel and was a lead designer with a robotics company. Maxim Lobovsky's 3D printer experience dates back to FabLab and Fab@Home projects as does David Cranor's. All three founders also came from a background at MIT Media Labs.
With so many criteria pointing to a high chance at success, we aren't surprised that FormLabs made several expansion announcements in early 2015. This startup is looking to grow rather than seek an IPO. In a single week, the company announced expansions in both Germany and China.*
* Krasserstein, Brian. "Formlabs Heads to Germany, Opens Office in Berlin, Partners with IGo3D." 3DPrintcom. N.p., 16 Mar. 2015. Web. 29 Apr. 2015. http://3dprint.com/51309/formlabs-germany-igo3d/
Molitch-Hou, Michael. "Formlabs' SLA 3D Printing to China - 3D Printing Industry." 3D Printing Industry Formlabs Brings LowCost SLA 3D Printing to China Comments. N.p., 10 Mar. 2015. Web. 29 Apr. 2015. http://3dprintingindustry.com/2015/03/10/formlabs-brings-low-cost-sla-3d-printing-to-china.
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