YC
A Conversation on Hard Tech with Eric Migicovsky
@ Y Combinator
10/13/18
Takeaways
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Eric Migicovsky
10/13/18
@ Y Combinator
I thought of the name 'Pebble' while lying on a beach, two years before we actually made it, and I wrote it down in Evernote as a good name.
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Eric Migicovsky
10/13/18
@ Y Combinator
We started the company in 2008 while I was still a student at Waterloo, and we didn't ship our first product until 2010, which was a long process.
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Eric Migicovsky
10/13/18
@ Y Combinator
We manufactured our first 100 units by hand, which allowed us to quickly iterate and fix problems as they arose during production.
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Eric Migicovsky
10/13/18
@ Y Combinator
Before going through the entire manufacturing process, we sold around 700 to 800 units of our product, which helped validate our idea.
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Eric Migicovsky
10/13/18
@ Y Combinator
When I had to move my business to Mountain View, I hired high school students to manage production back home, ensuring our sales process continued without interruption.
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Eric Migicovsky
10/13/18
@ Y Combinator
The hardest part of my journey with Pebble was the five years it took to achieve product-market fit, which involved a lot of trial and error.
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Eric Migicovsky
10/13/18
@ Y Combinator
After raising money, many startups forget how to be scrappy and creative, which is often essential for success in the early stages.
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Eric Migicovsky
10/13/18
@ Y Combinator
Crowdfunding can be useful at the early stage to raise funds for a working prototype, especially for hardware engineers with limited resources.
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Eric Migicovsky
10/13/18
@ Y Combinator
I recommend not trying to create a massive marketing campaign for crowdfunding at the start, as it often leads to failure in delivering the product.
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Eric Migicovsky
10/13/18
@ Y Combinator
Using crowdfunding as a marketing and sales channel can be effective, especially if you've already sold a significant number of units before launching the campaign. We received feedback from about 1,500 eager individuals who were very open with their thoughts, allowing us to tune and tweak the Pebble product effectively.
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Eric Migicovsky
10/13/18
@ Y Combinator
There are two separate crowdfunding opportunities that often get blended together, leading to confusion about which path to take in the consumer products life cycle.
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Eric Migicovsky
10/13/18
@ Y Combinator
If you're not confident in your ability to deliver a product within a certain timeframe, you should avoid using crowdfunding platforms that are heavily focused on shipping.
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Eric Migicovsky
10/13/18
@ Y Combinator
In hard tech, companies often need to be frugal and agile, testing products quickly to see if they resonate with the market, rather than over-investing in development before validating the idea. If you're a scientist or engineer considering commercializing your work, get out of your comfort zone and engage with potential customers to validate your product idea.
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Eric Migicovsky
10/13/18
@ Y Combinator
It's important to question whether a subscription model is truly what customers want, as forcing it can create additional problems beyond just building great products.
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Eric Migicovsky
10/13/18
@ Y Combinator
In hard tech, the iteration cycles are much longer than in software, often due to hardware constraints or regulatory issues, which can affect how quickly you can develop and test new ideas.
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Eric Migicovsky
10/13/18
@ Y Combinator
For medical devices, the MVP should be successfully peer-reviewed science that supports your work and outlines a clear path to regulatory clearance.
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Eric Migicovsky
10/13/18
@ Y Combinator
Founders need to be technically competent and understand that they may have to become salespeople to successfully market their products.
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Eric Migicovsky
10/13/18
@ Y Combinator
Sales should be prioritized early in the startup process, as engaging with customers can lead to better product development and quicker sales success.
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Eric Migicovsky
10/13/18
@ Y Combinator
It's crucial to engage with customers early on, as they can provide valuable feedback that helps you build a better product than if you just focus on perfecting the prototype first.
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Eric Migicovsky
10/13/18
@ Y Combinator
Engaging with customers early can provide the momentum needed to refine your product and ensure it meets market demands.
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Eric Migicovsky
10/13/18
@ Y Combinator
The best companies are those that don't require a lot of money to reach the MVP stage, allowing for quicker iterations and customer feedback.
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Eric Migicovsky
10/13/18
@ Y Combinator
Relativity Space's approach to 3D printing rockets aims to reduce integration time by printing the entire rocket in one piece, which could revolutionize the industry.
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Eric Migicovsky
10/13/18
@ Y Combinator
To get your first customers, infiltrate communities where your target audience discusses products and services, and leverage personal relationships with bloggers and influencers.
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Eric Migicovsky
10/13/18
@ Y Combinator
When starting a hardware project, find an off-the-shelf product that closely resembles what you want to build to save time and resources during prototyping.
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Eric Migicovsky
10/13/18
@ Y Combinator
Using existing technology and modifying it can lead to innovative solutions, as seen with companies that repurpose off-the-shelf products for new applications.
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Eric Migicovsky
10/13/18
@ Y Combinator
If you're pre-product market fit, consider moving closer to your customers to facilitate faster iterations and better understand their needs.
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Eric Migicovsky
10/13/18
@ Y Combinator
Companies that have a network effect or data lock-in create a natural moat, making it difficult for competitors to replicate their success.
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Eric Migicovsky
10/13/18
@ Y Combinator
Patents can be easier to obtain now with the help of services that streamline the filing process, making it more accessible for startups.
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Eric Migicovsky
10/13/18
@ Y Combinator
Building a great product is the most effective way to create a competitive advantage, rather than relying on patents, which are rarely successful for startups.
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Eric Migicovsky
10/13/18
@ Y Combinator
Investors often prefer small markets initially because they allow for easier identification of potential customers and quicker feedback on product viability.
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Eric Migicovsky
10/13/18
@ Y Combinator
Starting small is beneficial, but having a roadmap for growth is crucial for both investor confidence and personal motivation.
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Eric Migicovsky
10/13/18
@ Y Combinator
When hiring, prioritize trust and reliability over specific domain knowledge, as this approach can expedite team building during critical growth phases.
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Eric Migicovsky
10/13/18
@ Y Combinator
For hardware projects, consider starting with software solutions to validate ideas before investing in physical products.
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Eric Migicovsky
10/13/18
@ Y Combinator
To manage inventory effectively, consider pre-orders to gauge demand and reduce upfront costs, or shorten lead times to minimize cash flow issues.
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Eric Migicovsky
10/13/18
@ Y Combinator
Sometimes, it's worth paying more for components if it results in shorter lead times, as this can alleviate cash flow problems despite lower profit margins per unit.