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Quite a few hardware startups have gained a (sometimes large) portion of their series-A funding through Kickstarter or similar platforms.

josephpmay 11y ago
Could you provide a single example of a successful hardware Kickstarter that has made it to production without a VC series-A?
- ajross 11y ago
  Formlabs shipped their first printers before VC money I believe. Wikipedia tells me they've since taken $19M more via traditional channels.
  - iammaxus 11y ago
    Not exactly. We raised a seed round of $1.8m a little less than 1 year before the Kickstarter. We probably could have built and shipped the product off of the crowdfunding proceeds, but we couldn't have had such a successful crowdfunding campaign without spending some of that money to design the product and market it well.
- jkestner 11y ago
  Define "successful hardware Kickstarter". There's more than just the ones you hear about because they raised millions. The vast majority of hardware Kickstarters get shipped without additional funding.
- pdmccormick 11y ago
  Kilpatrick Audio (http://www.kilpatrickaudio.com/ http://www.kilpatrickaudio.com/) did a Kickstarter for their Phenol patchable analog synthesizer, which I believe is now generally available for order.
- avidanr 11y ago
  Particle.io It used to be called Spark Devices. They successfully shipped the spark core, then Root Ventures led their series A (we were called Lion Wells back then)....i know, so many name changes!
avidanr 11y ago
As a hardware investor (founder of Root Ventures, mentioned in the article), I'd be careful to differentiate between funds raised from investment vs kickstarter or crowdfunding. At the most basic level, $'s raised via kickstarter should sit on your balance sheet as a liability. There is an expectation that you will deliver product equaling the amount you raised. Of course there are margins baked into the product price, but VC money is truly there for business development. We have invested in several very successful companies who have had millions of dollars in successful campaigns on kickstarter. Each and every time, the KS money is earmarked for delivering the promised product (tooling, Mfg, shipping), while the VC money is used to build a company (recruiting, office space, salaries, travel).
- tarikjn 11y ago
  What stage do you typically invest at? pre-Kickstarter? post-Kickstarter? pre-manufacturing prototype? Working prototype? How about hardware startup accelerators, how should a startup choose between talking a VC or an accelerator and at what stage?
  - avidanr 11y ago
    Ok. I'm gonna try some stream of consciousness answering... I always need to see someone having done some difficult technical development. As an engineer myself, it makes my job so much more fun (i do code/design review with every startup i invest in!). Seeing a team build a prototype shows another level of commitment. I've built hardware, so i know how much more time/effort/money it takes over a software wireframe...It also minimizes one of the risks of the startup. Can the team build what they say they can build? I see 3 primary risks of building a startup; technical, team, and market. My goal is to invest when as many of those are solved, but completely understanding that because i am a seed stage investor, will never see all 3 de-risked before i invest. Some of my investments were during a kickstarter (Prynt and Particle fka Spark.io) Others I invested pre-kickstarter (Shaper -- shapertools.com) And others are not meant for crowdfunding (Plethora, Momentum Machines) The question of an accelerator vs going direct to VC is a different story. I see accelerators helping a tremendous amount with first time hardware entrepreneurs...and since the hardware startup space is so new, thats almost everyone! However, there are experienced hardware founders, and I have definitely invested in teams that have not gone through accelerators (Plethora -- seasoned entrepreneurs, DFX Machina -- Senior ex-Apple founders) Overall, its never to early to speak with a VC or accelerator. We are here to support the ecosystem. That means inspiring potential founders to go for it, and help educate those inspired to take the rights steps, and avoid the mistakes of others. We make it easy to find us for a reason!!!

josephpmay 11y ago

Could you provide a single example of a successful hardware Kickstarter that has made it to production without a VC series-A?

ajross 11y ago
Formlabs shipped their first printers before VC money I believe. Wikipedia tells me they've since taken $19M more via traditional channels.
- iammaxus 11y ago
  Not exactly. We raised a seed round of $1.8m a little less than 1 year before the Kickstarter. We probably could have built and shipped the product off of the crowdfunding proceeds, but we couldn't have had such a successful crowdfunding campaign without spending some of that money to design the product and market it well.
jkestner 11y ago
Define "successful hardware Kickstarter". There's more than just the ones you hear about because they raised millions. The vast majority of hardware Kickstarters get shipped without additional funding.
pdmccormick 11y ago
Kilpatrick Audio (http://www.kilpatrickaudio.com/ http://www.kilpatrickaudio.com/) did a Kickstarter for their Phenol patchable analog synthesizer, which I believe is now generally available for order.
avidanr 11y ago
Particle.io It used to be called Spark Devices. They successfully shipped the spark core, then Root Ventures led their series A (we were called Lion Wells back then)....i know, so many name changes!

avidanr 11y ago

As a hardware investor (founder of Root Ventures, mentioned in the article), I'd be careful to differentiate between funds raised from investment vs kickstarter or crowdfunding. At the most basic level, $'s raised via kickstarter should sit on your balance sheet as a liability. There is an expectation that you will deliver product equaling the amount you raised. Of course there are margins baked into the product price, but VC money is truly there for business development. We have invested in several very successful companies who have had millions of dollars in successful campaigns on kickstarter. Each and every time, the KS money is earmarked for delivering the promised product (tooling, Mfg, shipping), while the VC money is used to build a company (recruiting, office space, salaries, travel).

tarikjn 11y ago
What stage do you typically invest at? pre-Kickstarter? post-Kickstarter? pre-manufacturing prototype? Working prototype? How about hardware startup accelerators, how should a startup choose between talking a VC or an accelerator and at what stage?
- avidanr 11y ago
  Ok. I'm gonna try some stream of consciousness answering... I always need to see someone having done some difficult technical development. As an engineer myself, it makes my job so much more fun (i do code/design review with every startup i invest in!). Seeing a team build a prototype shows another level of commitment. I've built hardware, so i know how much more time/effort/money it takes over a software wireframe...It also minimizes one of the risks of the startup. Can the team build what they say they can build? I see 3 primary risks of building a startup; technical, team, and market. My goal is to invest when as many of those are solved, but completely understanding that because i am a seed stage investor, will never see all 3 de-risked before i invest. Some of my investments were during a kickstarter (Prynt and Particle fka Spark.io) Others I invested pre-kickstarter (Shaper -- shapertools.com) And others are not meant for crowdfunding (Plethora, Momentum Machines) The question of an accelerator vs going direct to VC is a different story. I see accelerators helping a tremendous amount with first time hardware entrepreneurs...and since the hardware startup space is so new, thats almost everyone! However, there are experienced hardware founders, and I have definitely invested in teams that have not gone through accelerators (Plethora -- seasoned entrepreneurs, DFX Machina -- Senior ex-Apple founders) Overall, its never to early to speak with a VC or accelerator. We are here to support the ecosystem. That means inspiring potential founders to go for it, and help educate those inspired to take the rights steps, and avoid the mistakes of others. We make it easy to find us for a reason!!!