Since 2000, it would seem that software companies have been the only technology startups disrupting markets, that is until recently in the last few years with a small uprising of hardware startups. The hardware industry has started to gain momentum thanks to success stories such as Nest, Dropcam and Oculus being acquired. Valued together, these companies have a total worth of more than $10 billion. Despite these laudable gains, recent events have nonetheless reconfirmed the risk and difficulty associated with sustaining hardware startups. Recent events such as GoPro’s layoffs, and Pebble, Lily and Skully shutting down operations further substantiate the trend of corporations dominating hardware, and startups focusing on software.
This reality becomes even more evident in new markets such as Virtual Reality/Augmented Reality, Robotics and AI. Zooming into VR/AR, prominent companies include Sony, Samsung, HTC, Facebook and Microsoft. Given the fact that these companies have more resources such as capital, people, manufacturing and even distribution, their prominence makes sense. If their initial product version does not become a hit or the market takes longer to rise, these companies nonetheless have the endurance to continue beyond just a couple of years.
How can any startup compete when the stakes are so high and chances so low?
Like many entrepreneurs, I was optimistic when I decided to take my chances at building a VR camera startup from the ground up. Fast forward several years, and looking back, I can definitely say that the challenges from lack of capital to limitations with manufacturing made the experience seem all the more insurmountable. Yet the approach that my team and I took along our journey not only helped my company to launch, but also allowed us to continue advancing in spite of the odds stacked against building a successful hardware startup in VR.
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Source: Forbes