# 084: How To Raise Big Money for Your Hardware Startup

- Show: [Product Startup](https://hardwarepodcasts.com/podcast/product-startup)
- Published: 2021-07-14
- Length: 27m
- Page: https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup
- Listen: https://productstartup.com/

## Summary

Brett Fox, who has raised nearly $500 million for hardware startups and served as an entrepreneur in residence for a Silicon Valley VC firm, explains how to raise seed and venture capital. He distinguishes between angel, seed, and VC funding stages, emphasizing that hardware companies must generate 'proof' through customer traction, pre-orders, or crowdfunding to reduce investor risk. Fox details the mathematical requirements for VC returns, noting that investors seek 10x-30x returns, which dictates valuation and market size expectations. He advises founders to prioritize alignment with 'smart money' investors regarding exit strategies and to use rejections to gather feedback and referrals.

## Chapters

- [0:48](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=48) Introduction: Brett Fox and his background in raising capital
- [3:17](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=197) Defining funding stages: Angel, seed, and venture capital amounts
- [5:31](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=331) Generating proof of concept: Traction, revenue, and customer validation
- [7:57](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=477) Creative derisking: Pre-orders, crowdfunding, and B2B letters of intent
- [11:21](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=681) VC math: Valuation, ownership percentages, and 10x return expectations
- [14:35](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=875) Assessing fit: Is venture capital appropriate for your hardware business?
- [16:45](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=1005) Partnering with smart money: Alignment, exit strategies, and transparency
- [21:36](https://hardwarepodcasts.com/podcast/product-startup/2021-07-14-084-how-to-raise-big-money-for-your-hardware-startup#t=1296) Fundraising dynamics: Emotional connection, diligence, and asking for referrals

## Topics

- [Fundraising & investors](https://hardwarepodcasts.com/topic/fundraising)
- [Validation & product-market fit](https://hardwarepodcasts.com/topic/validation-and-product-market-fit)
- [Crowdfunding & preorders](https://hardwarepodcasts.com/topic/crowdfunding)
- [Pricing, margins & unit economics](https://hardwarepodcasts.com/topic/pricing-and-unit-economics)

## Most relevant to

early-stage companies, companies scaling up

## Mentioned

- Brett Fox (other)
- Mako Design + Invent (company)

## Related episodes from other shows

- [S1 E7: Level Up Your Hardware Product Pitch with Haje Kamps](https://hardwarepodcasts.com/podcast/the-builder-circle/2023-06-27-s1-e7-level-up-your-hardware-product-pitch-with-haje-kamps) (The Builder Circle)
- [S3 E4: An Impact Hardware VC's Playbook with Carlota Ochoa from Extentia](https://hardwarepodcasts.com/podcast/the-builder-circle/2025-11-11-s3-e4-an-impact-hardware-vcs-playbook-with-carlota-ochoa-from-extentia) (The Builder Circle)
- [#015 - How to benefit for your hardware project from the first major crowdfunding platform, with Sandy Diao of Indiegogo, USA](https://hardwarepodcasts.com/podcast/the-hardware-entrepreneur/2017-03-01-015-how-to-benefit-for-your-hardware-project-from-the-first-major-crowdfunding-p) (The Hardware Entrepreneur)
- [Deep Tech Investing](https://hardwarepodcasts.com/podcast/oxide-and-friends/2022-08-02-deep-tech-investing) (Oxide and Friends)
- [S2E37 Defied the odds:  A Physical Product Development Firm That Focuses on Startups & Small Businesses, Mako Design + Invent –Kevin Mako](https://hardwarepodcasts.com/podcast/being-an-engineer/2021-08-23-s2e37-defied-the-odds-a-physical-product-development-firm-that-focuses-on-startu) (Being an Engineer)

## Citing this page

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