Interview with Shaun Arora
Make in LA are a 3-person team building a community in Los Angeles dedicated to bringing hardware start-ups to market. Their background ranges from seed-stage to public companies. With the backing of NEO Tech, they are able to apply professional manufacturing tools and other resources directly into programs and start-ups to maximize the odds of success.
Their 4-month program is a stress test for entrepreneurs and their business models. They aim to empower the entrepreneur and their business by making hardware not hard.
Hello Shaun, could you please introduce Make in LA and what key projects you have managed since becoming the VC's Managing Director?
Make in LA is a startup accelerator. We invest in startups that are doing hardware, physical objects - these could be: robotics, wearables, IOT. We run a four-month accelerator program, once a year, in Los Angeles. We have anywhere from two-three companies, all the way up to 10 companies, participate at the same time. Each of these companies got an investment of at least a hundred thousand dollars, and we work our best to help them get to that next milestone. Hardware is hard, and we try to help those companies figure out what the next milestone is: what's keeping them off of the traditional VC rails and get them back on there, so that they are able to get to whatever milestone that they're trying to hit which, generally, we want to see companies get to two hundred plus million dollars in sales in the next five years. What projects have I managed? Well I'm the founder here, so we created that. We created - behind us is Toolbox L.A., the innovation hub. We have a maker space, events space, coworking space and we've done six cohorts.
What are some of the unique challenges and opportunities associated with investing in emerging hardware companies?
So hardware startups have many challenges in regards to investing in them. There's a lot of people who would just automatically rather about say, "We don't fund hardware startups." It's not true, you just haven't made a convincing case that your company is solving a big enough problem, and they just see hardware and they have all these biases. So I think that's one of the biggest, most interesting challenges is: how do you articulate your startup in a way where people get excited, and they don't automatically go to the easy no, which is: we don't fund hardware. We love helping companies with their storytelling, getting people excited, and getting people over that barrier. Because even people who said software is eating the world, that firm is funding lots of hardware startups. So, it's one of the things that we love, that people are funding hardware. And if you are master of telling that story, if you work with us we can help you get there. That's definitely a huge opportunity.
How are the growth/scaling processes of hardware startups unique from those of software startups?
So scaling a hardware startup is very different than scaling a software startup, and one of the key differences is: it's harder to iterate one’s product in the wild. So we help companies really figure out how to de-risk their product and then go to market strategies before they build a product. The more mistakes you can make before building, the easier and cheaper it is to have a successful product. One of the benefits of frontloading the de-risking process is we do hit on something, and you do have a - we're riding this giant wave. You have customer login, you have really easy customer acquisition. I remember the CEO of Lime scooters and bikes said that they don't even spend on customer acquisition, because the product just advertises itself. So when you start really hitting into the growth and scaling parts of hardware, it gets really cheap and quick. It's just that initial part, going from a prototype to mass manufacturing, where you have lots of skill sets they need to bring on the team and lots of opportunities to make mistakes - and that's one the reasons why we created Make in LA capital: is to help entrepreneurs avoid those mistakes. We bring in experts from all areas of technology, all job functions, CEOs of other hardware startups to come in and help these entrepreneurs uncover these roadblocks, these landmines, and make sure that the getting to market in the easiest, quickest way possible.
What's next for your work with Make in LA - what new companies, projects and partnerships will you be focusing on throughout the next year?
So we're constantly looking for new companies at the intersection of technology and supply chain complexity. If you're building a product that's going to have challenges in manufacturing, logistics, we want to be involved, we want to help. So we're looking at companies in the healthcare space, in foodtech, biotech. We have a wet lab in our facilities, so we love putting that to use and we're looking at Industry 4.0. So there's a number of areas - if you're working one of these please reach out; and if you're not, you can still reach out at mila.vc, and we'd love to get to know you!