@dragoninnovate /dragoninnovationwww.dragoninnovation.com

THE JOURNEY FROM IDEA TO PRODUCT ON THE SHELFDRAGON INNOVATION

SCOTT@DRAGONINNOVATION.COM

NORTHEASTERN UNIVERSITYPROF. KRISHNAN

NOVEMBER 25, 2014 AT 17:20 ET

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Presentation Download

http://bit.ly/idea-to-shelf-northeastern

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Agenda

http://en.wikipedia.org

•Quick Survey

•Dragon Journey from the Idea to Shelf

•How to Raise Money

•Q & A

Quick Survey

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From the Idea to the Shelf

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MIT RoboTuna

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Agenda

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Robotic Corvette Powered Dino

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Agenda

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Initial iRobot Expertise (Revenue)

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Journey from $100,000 to $100 Price

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My Real Baby ~ 100k

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Velociraptor ~100k

+

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Rooomba and Scooba

Manufacturing is Complex

Agenda

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We are going to take something as insanely

complex as manufacturing consumer electronics and

make it feel easy.

VISION

Bolt

Bolt

Applying 250 Combined Years Experience To Build >100 Hardware Companies

BRE PETTISMAKERBOT

“During the final stages of product design, we have the Dragon team come in to assess manufacturability and assembly. They’ve been very helpful and made our products strong. Dragon Innovation can act as a trailguide to help navigate the decisions and drama of producing hardware.”

CARLOS HERRERA CEO / FOUNDER, PINTOFEED

“We really had no concept as to the manufacturing process. Thankfully, Dragon was keen on educating us - helping us identify gaps in our design, and guiding us on the full manufacturing process from inception to fulfillment.”

“During the final stages of product design, we have the Dragon team come in to assess manufacturability and assembly. They’ve been very helpful and made our products strong. Dragon Innovation can act as a trailguide to help navigate the decisions and drama of producing hardware.”

ERIC MIGICOVSKYPEBBLE

"Dragon helped us take our crowdfunding success and translate it into to shipping more than 100,000 Pebbles in just over a year. They provided critical support on-the-ground in China and sourced excellent suppliers."

KELLER RINAUDOROMOTIVE

JEEVAN KALINITHISIFTEO

“If you’re looking to produce stuff at scale, you have to realize that the manufacturing process is hard. Dragon helped us climb the manufacturing learning curve with their expertise.”

DRAGON INNOVATION HAS HELPED LAUNCH AND SCALE OVER 100 COMPANIES SINCE 2009

How to Raise Money

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Hardware Requires Cash

Typical funding sequence:

1.Bootstrapping2.Friends and Family3.Angels4.Crowdfunding5.Venture Capital

Crowdfunding: Sell then Build

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Goals of Crowdfunding

•Raise capital upfront

•Validate product / market fit

•Create engaged & passionate community early

•Get the attention of media and investors

•Understand build volumes

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BE CAREFUL YOU DON’T SELL SOMETHING YOU

CAN’T BUILD

Why Delivering Is Hard

Getting from prototype to delivery is a long journey with many ‘unknown unknowns ’:

• COGS, tooling and manufacturing costs• Lead times• Permanence of Quality• Iteration cycles• DFMA• Factory Selection and Management• Team Scalability• Schedule & Project Management• Specialized skills (ME / EE / SW/ Q / SC / Logs)

The Three ThingsYou Need to Know Before Crowdfunding

1.How much cash do you need?2.How long is it going to take?3.What is the status of your Design for Manufacturing?

Manufacturing Factors That Drive Funding Requirements

•NRE for Prototype to DFM•COGS•Tooling Costs•Manufacturing Costs•Crowdfunding Transaction Costs

Idea DeliverCrowdfund

Manufacture

PERCEIVED PRODUCT TIMELINE

Prototype

D E F G H I J K L M N O P Q

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

R S T U V ZW X YA B C

Idea DeliverCrowdfund Manufacture

MORE REALISTIC PRODUCT TIMELINE

Proto

CF Prep

X Y ZK L M N O P Q R S T U V WI J F G HC D E A B

Typical Stages•Paper sketches•Handmade prototype (popsicle sticks and hot glue)•3D printed prototype (works-like)•Industrial Design model (looks-like)•Design for manufacture (for Tool Start)• Injection Molded with drafts, rounds, minimal undercuts•Die Cast•Stamped•CNC•Final Product Design in Manufacturing

Venture Capital

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Formula to Raise VC

•Working Prototype•Traction in Market (i.e. successful CF campaign)•Strong technical and business team•Understanding of market size and economics•Warm intros to VCs that are a good fit for your stage (Seed)

Questions?