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The business of 
Hardware Startups 
Aleš Špetič, 2014
sketching 
MVP 
scaling 
-2 launch 
iterating 
Aleš Špetič, CubeSensors 2
sketching 
prototyping 
production 
manufacturing 
scaling 
-12 -6 launch 
Aleš Špetič, CubeSensors 3
hardware 
engineering 
product 
management 
manufacturing 
design 
engineering 
selling 
ops 
usability management 
firmware 
engineering 
backend 
logistics 
software 
engineering 
product 
user 
support 
marketing 
frontend 
safety & 
compliance 
Aleš Špetič, CubeSensors 4
SOFT ltd 
1.000.000 
500.000 
1MM users, 
1.500.000 
250.000 
4% conversion @ $10/year 
$400k/ year 
HARD ltd 
2.500 
1.500 
2.000 
6.000 
12.000 units/year, 
@ $100, 30% margin 
$400k in margin 
Aleš Špetič, CubeSensors 5
consumer 
business tech 
Aleš Špetič, CubeSensors 6
60% 10% 30% 
R&D 
LOGISTICS 
MARGIN 
Aleš Špetič, CubeSensors 7
20% 10% 10% 10% 25% 25% 
R&D BOM 
WHOLESALE RETAILER LOGISTICS 
MARGIN 
direct 
online retailers 
distribution channels 
Aleš Špetič, CubeSensors 8
300 
225 
150 
75 
0 
Aleš Špetič, CubeSensors 9
HW has great exits: 
customer loyalty: PC 
barriers to entry: 
3y 
phone 
2y 
service 
1y 
app 
3m 
limited 
iterations 
working 
capital 
production 
risks 
Aleš Špetič, CubeSensors 10
ales@cubesensors.com 
@alesspetic 
hwguide.spetic.si 
Aleš Špetič, CubeSensors 11

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IDCEE 2014: Business Of Hardware Startups - Ales Spetic (CEO @ CubeSensors)

  • 1. The business of Hardware Startups Aleš Špetič, 2014
  • 2. sketching MVP scaling -2 launch iterating Aleš Špetič, CubeSensors 2
  • 3. sketching prototyping production manufacturing scaling -12 -6 launch Aleš Špetič, CubeSensors 3
  • 4. hardware engineering product management manufacturing design engineering selling ops usability management firmware engineering backend logistics software engineering product user support marketing frontend safety & compliance Aleš Špetič, CubeSensors 4
  • 5. SOFT ltd 1.000.000 500.000 1MM users, 1.500.000 250.000 4% conversion @ $10/year $400k/ year HARD ltd 2.500 1.500 2.000 6.000 12.000 units/year, @ $100, 30% margin $400k in margin Aleš Špetič, CubeSensors 5
  • 6. consumer business tech Aleš Špetič, CubeSensors 6
  • 7. 60% 10% 30% R&D LOGISTICS MARGIN Aleš Špetič, CubeSensors 7
  • 8. 20% 10% 10% 10% 25% 25% R&D BOM WHOLESALE RETAILER LOGISTICS MARGIN direct online retailers distribution channels Aleš Špetič, CubeSensors 8
  • 9. 300 225 150 75 0 Aleš Špetič, CubeSensors 9
  • 10. HW has great exits: customer loyalty: PC barriers to entry: 3y phone 2y service 1y app 3m limited iterations working capital production risks Aleš Špetič, CubeSensors 10
  • 11. ales@cubesensors.com @alesspetic hwguide.spetic.si Aleš Špetič, CubeSensors 11