"Subclassing and Composition – A Pythonic Tour of Trade-Offs", Hynek Schlawack
HAX at stanford
1. HAX
AT
STANFORD
CYRIL EBERSWEILER @HAXLR8R
BENJAMIN JOFFE
@BENJAMINJOFFE
BUILDING
LEAN
HARDWARE
STARTUPS
Wearable 10x
PhD Patents
Stealth
Accelero
-meter
Investors Prototype
3D printed
Algorithms
PCB Shipping
Beta test Off the shelf
2. LEAN HARDWARE PHILOSOPHY
1. Validate problem vs. Assume
2. Partner w/ factories vs. Abdicate
3. Fast to market vs. Long cycles
4. Capital effective vs. Capital intensive
5. User backed vs. Venture backed
6. Sustainable vs. Growth at a loss
3. LEAN HARDWARE PHILOSOPHY
1. Validate problem vs. Assume
2. Partner w/ factories vs. Abdicate
3. Fast to market vs. Long cycles
4. Capital effective vs. Capital intensive
5. User backed vs. Venture backed
6. Sustainable vs. Growth at a loss
5. THE COST OF NOT BEING IN CHINA
• “You have to consider the
cost of not being in China.”
• “If you benefit from
economies of scale, China
will make sense, so better to
start early and learn
quickly.”
• HAX Comment: if you start
elsewhere, consider the
switching costs once you
reach thousands of units.
Will Hart
Chief of Staff
Spark.io
(HAX 2)
6. WHAT ABOUT MY IP?
• “Protection of IP takes the
form of complex
manufacturing or product,
community, and cloud
based services that are
hard to reproduce outside of
the hardware itself.”
• HAX Comment: you might
find the hardware you need
for your service in China’s
thousands of factories. Both
Idan Beck
Founder
gTar
(HAX Fund)
7. “THE LOST ART OF INJECTION
MOLDING”
• “Factory engineers can just
look at a product and see the
mold around it and the
material flowing. They can also
tell you if what you have can be
made, and how to do it.”
• "Being on the factory floor will
help you solve problems much
faster, speaking the language
of engineering."
• HAX Comment: China picked
up manufacturing knowledge
where America left it, and ran
Bunnie Huang
Hardware Hacker
Bunnie Studios
(HAX Mentor)
8. WHY GO TO CHINA EARLY?
• Prototype better and faster
– PCBs overnight
– All the components you need
– All sorts of tools for prototyping
– “Lost art of injection molding”
– Design for manufacturing
– (much) Cheaper
• Build and scale fast
– Integrated supply chain
– Scale up from 1 to any number
– Prepare scaling before it’s painful
Where is the mold?
9. WHY WOULD A LAOBAN CARE?
• Four-and-a-half
reasons for factory
owners to work with
startups
1. Grow with you
2. Use excess capacity
3. Improve capabilities
4. Internationalize
4.5 Fun The rest is up to you
16. 8 THINGS ABOUT HAX
1. 111 days
2. Shenzhen & San Francisco
3. 40 startups
4. 60% US+Canada // 20% EU // 20% Asia
5. IOT, wearables, robots, etc.
6. $250k average on KickStarter
7. A growth platform
8. Apply now!
22. STARTUP VS. BUSINESS
• Startup = looking for a scalable business
model
• Business = executing on the model
23. HARDWARE RENAISSANCE
PROTOTYPING IS EASIER THAN EVER
Arduino / Pi / Spark / 3D printing / Sensors /
BLE / Smartphones / Cloud
SUPPLY CHAIN IS BETTER THAN EVER
– China (Shenzhen) has the whole chain
– Fast, Affordable, Scalable
MORE FUNDING
– KickStarter (250,000+ HW backers!),
IndieGoGo
– More VC & Angel money, acquisitions
24. BE A MASTER OF THE PROBLEM
What matters is the problem,
not the solution!
28. “The question is no
longer: can we make
it?
But: what can we
make
that’s worthwhile?”
Dr. Bjoern Hartmann
Interactive Device Design
Critical Making
HARDWARE TODAY
31. STARTUP CHECKLIST
1. Product Is something working
2. Skills Can the team make it
3. Spirit Resourceful, Optimistic,
Persistent
32. STARTUP CHECKLIST
1. Product Is something working
2. Skills Can the team make it
3. Spirit Resourceful, Optimistic,
Persistent
4. Positioning New segment or new market
10x better in some way
33. BUILDING THE RIGHT THING
INITIAL PROBLEM
INITIAL SOLUTION
INITIAL PROBLEM
NEW SOLUTION
NEW PROBLEM
INITIAL SOLUTION
NEW PROBLEM
NEW SOLUTION
INITIAL PROBLEM
INITIAL SOLUTION
34. STARTUP CHECKLIST
1. Product Is something working
2. Skills Can the team make it
3. Spirit Resourceful, Optimistic,
Persistent
4. Positioning New segment or new market
5. Demand Proof / Customer discovery
6. Distribution How to sell
7. Plan Beyond first product
35. NOT JUST HARDWARE
• Pure hardware can be copied
• Combine Hardware & Software
• Community (GoPro, Makerbot,
Glass…)
40. TWELVE “WARES” TO AVOID
1. FUNware No business
(includes NICHEware and ARTware)
41. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
42. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
“Two sensors
and an app”
Nobel-grade
research
43. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
PRESSY ($27)
Funded Oct 2013
Raised $695,000
44. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
Speed Button ($10)
(“kuai anniu”)
Funded Jan 2014
Raised $34k
45. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
Xiaomi MiKey
($0.8)
Launched April 2014
“If Xiaomi starts producing
buttons like Pressy,
we will start to produce
smartphones.”
- Founder of Pressy
46. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
47. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
“Build a better mousetrap and the
world
will beat a path to your door”
Ralph Waldo Emerson
(maybe)
48. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
The problem with
mousetraps
• 4,400 patents
• 400 applicants per year
• “most frequently invented
device in U.S. history”
49. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
50. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
“When you have a hammer, everything looks
51. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
52. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
53. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
54. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
55. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
7. FAILware Successfully built the wrong thing
56. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
7. FAILware Successfully built the wrong thing
8. LATEware Validated market but woke up
competitors
57. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
7. FAILware Successfully built the wrong thing
8. LATEware Validated market but woke up
competitors
9. LOSSware Minimal or negative margins
58. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
7. FAILware Successfully built the wrong thing
8. LATEware Validated market but woke up
competitors
9. LOSSware Minimal or negative margins
10. BOREware People stop using it
59. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
7. FAILware Successfully built the wrong thing
8. LATEware Validated market but woke up
competitors
9. LOSSware Minimal or negative margins
10. BOREware People stop using it
11. FUTUREware No market before years
60. TWELVE “WARES” TO AVOID
1. FUNware No business
2. EASYware Not defensible
3. SAMEware Bad positioning
4. SOLUTIONware Solution looking for a problem
5. VAPORware Can’t be made
6. LAMEware Not on spec
7. FAILware Successfully built the wrong thing
8. LATEware Validated market but woke up
competitors
9. LOSSware Minimal or negative margins
10. BOREware People stop using it
11. FUTUREware No market before years
63. THE RETAIL CHASM
PROTOTYPING PRODUCTION SCALING
$
Founders
Friends
Family
Fools
Crowdfunding
Accelerators
Angels
Sales
Factoring
Banks
VCsPre-orders
RETAIL
CHASM
TIME
64. SCALING STEP BY STEP
$
TIME
Specialty
stores
Big box
retailers
Online
retailers
Direct
65. LEAN RETAIL RULES
Keep demand higher than
distribution
Your customers are your best
investors
Retail is not a sprint. Learn at
each step
66. SAVE YOUR CASH FLOW!
Pre-sales (best!)
Credit from supplier (it’s like a bank
loan!)
Factoring (purchase order financing)
Bank credit lines
Revenue-based financing
VC (most expensive money!)
67. KEY STAGES FOR INVESTMENT
1. Concept
2. Work-like prototype
3. Look-like Prototype
4. DFM
5. Crowdfunding
6. First shipment
7. Retail
8. Pre-IPO
We recruit here
We take you there
We help anticipate this
Awaiting you there!
69. LEAN HARDWARE PHILOSOPHY
1. Validate problem
2. Partner with factories
3. Fast to market
4. Capital effective
5. User backed
6. Sustainable
+ HAX Philosophy
Meaningful products
Alignment with