Gate 3: Fund
The bottom line is that you can only raise money with something physical, something built. A PowerPoint may raise some interest, but getting your prototype built is a rite of passage, a passage to cash. And as far as funding is concerned, the more the better. That probably seems obvious, but I've said it before: Hardware is fairly expensive to build and experiment with. You will need around $20K to play with plastics only, $40K to build something that has more mechanical parts or optics, and around $80K to build a serious consumer electronics prototype. I truly believe that these numbers are the bases, a minimum and not an average. And on that note not all money is equal. If you can, find a future customer that will fund your first order, and only then try Crowdfunding and venture or debt financing
Speaking of Crowdfunding, it has changed everything, as evidence by so many success stories from Moment to Poppy to Ouya and Pebble. These makers found money by connecting with a community of future customers who made it happen for them. And funding accelerators are another great option that not only help you with cash, but also with much needed relation-ships, processes and mentoring.
"In our world, Kickstarter is foreplay. So much other stuff has to happen to create a successful hardware business. And if we're successful, for hardware companies the only barrier to entry will be their passion."
Liam Casey, PCH CEO