For Dragon Innovation, helping hardware makers become legit hardware companies is a bit like teaching them how to walk: It requires a whole lot of hand-holding.
The company, which counts companies like Pebble and MakerBot as its previous tutees, is built on the realization that, while thinking up products is easy, actually building and shipping them rarely is.
“With hardware, if you don’t get everything right up front, a lot of bad stuff will happen,” Dragon Innovation CEO (and ten-year iRobot vet) Scott Miller told VentureBeat on Wednesday. ‘
Recognizing the constant hurdles new hardware companies face, Dragon Innovation has made a business of helping companies learn how to optimize their go-to-market strategies and teaching them the virtues decreasing their production costs.
Now, the company is filling out the other half of the equation with its own crowdfunding platform, which it’s been testing in beta since August. The site, which is launching with eight products, is all about giving hardware startups the money they need to get their products off the ground.
While such a project might draw some obvious comparisons to popular sites like Kickstarter and IndieGoGo, what Dragon Innovation is doing here is a bit different. If things go right, when Dragon Innovation launches a product, it’s also launching a company.
Or, to use Miller’s scarily apt analogy: If Kickstarter is like a butterfly, Dragon Innovation is closer to a Kangaroo. It actually helps its babies grow up.
“What we offer startups is something you can’t google. You really have to have the experience,” Miller says.
Above: Even hardware heavyweights like MakerBot had to start somewhere (and that somewhere was with Dragon Innovation).
So why crowdfunding? Miller’s answer is actually pretty simple: When hardware makers launch a product on Kickstarter, the level of ensuing interest tells them exactly how many people are interested in buying what they’re selling. You can’t ask for better market research than that.
“If you can convince people to open up their wallets before getting a product, that’s a pretty good indication you’re onto something,” says Miller.
The problem, though, is that its often tough for hardware companies to translate that sort of interest into actual shipped products. This is something that even Pebble (and its Kickstarter backers) found out the hard way. Dreaming up a well-received product doesn’t always mean being able to ship said product on time.
That, again, is the problem Dragon Innovation wants to solve, and one that neither Kickstarter nor IndieGoGo, despite their vast successes, have managed to do all that well. If the next Pebble is out there, Dragon Innovation is in a pretty good spot to help fund it.