Below are just a few of the many questions investors may ask hardware founders and entrepreneurs when you are raising capital and seeking investor funding for your electronics hardware product startup.
Obviously, this is only a partial list, and angel investors, and seed and series investors will have different concerns depending on how terms are structured, such as convertible notes, warrants, equity… (Read: Hardware startup plan for design and manufacturing)
1. What [specific] management/industry experiences do the founders/exec team members each have that will enhance/support the model? What ‘specific’ talents do they each bring to the table? What is being done to ‘protect’ the management talent from leaving?
2. Are all management team members currently (actually) with the Company or are they holding other roles in other organizations while simultaneously supporting the Company? If so, why? Do they not believe in the product offering/marketplace?
3. What does the company have now? IP/patents, pats pending? Product centric vs service centric?
4. Are there current revenues? How are current revenues broken-down?
5. To what degree do current customer/industry relationships play into the feasibility of moving forward? ‘How’ do you plan to scale the business model? ‘What’ makes the model so scaleable? Details.
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6. Specifically ‘how’ will you save customers money? What encourages them to subscribe to what the Company is offering? How much can a customer expect to save by utilizing/installing your product? How will the customer justify the expense to ‘its’ BOD? This is essential in determining how much an organization is willing to pay.
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