Shenzhen

In July 2011 we started as a software company. But being in the area called today the Internet of Things, we've been increasingly more and more involved in hardware. Initially doing only reference designs and prototypes, now we are becoming a regular hardware vendor: in 2014 we plan to roll out several hardware devices.

Hardware is difficult. As Ben Kaufman (Quirky) says: "The thing standing in your way is not money, it’s the whole process". I can only confirm this experience. In 2013 we've worked with several engineering companies helping us with hardware design and the manufacturing process but all cases the process has been painful, expensive, and ineffective.

I've been in software business for 25 years and I've been observing the evolution of tools and methodologies. It's been the fastest evolution I've witnessed. The frameworks for software design, implementation, testing, deployment are simply incredible today. And so are the processes and team structures. Unfortunately our hardware partners have so far been like in the dark ages with all sorts of organizational problems, simply making them very hard to deliver quality products and services on time and within budgets.

To keep things moving at speed we've kept on hiring hardware engineers to gain more hardware design and prototyping capacity in house. But we've never aspired to become a high volume manufacturer.

The first hardware product we're launching in January'14 is small and simple. Yet it has proven how difficult the process is. Demonstrating any more complex product would be just impossible to manufacture in our current setup. Looking for solution to this problem I decided to go to the legendary Shenzhen, the world's most famous center of electronics design and manufacturing. The vibrant 18-million, fastest growing city, that was a small fishing village only 20 years ago...

And I could not believe what I've seen there. Everything seems possible! And first and foremost I like the Chinese approach to business. They are completely open and clear during the discussions. If there is any problem or doubt, they indicate the risks and potential blocker issues. What a relieving and time-saving approach! We visited about eight factories and design houses, spending about two hours at each of them, and in all cases those two hours were equivalent of a month or two of engagement with similar partners in Europe. They were all extremely competent, aware of all necessary certifications our products would need, depending in the distribution markets. Most of the discussions were around test procedures. And most quotes and timelines we were getting on the spot.

It all looks very promising and more importantly our strengths (software) and weaknesses (hardware) play very well into the exactly opposite strengths (hardware) and weaknesses (software) of the Chinese companies we've met. The match seems to be almost perfect and we will be pursuing this opportunity as deeply as we can. I think every software startup should visit Shenzhen at least once to see the options possible there. It is a different world, entirely, with a potential to change for good the way any IoT (software + hardware) business is done.