Atoms over Bits: Why We Need More Hardware Entrepreneurs

Atoms make up everything around us, but bits have been on the spotlight for the last few decades. Venture Capital investors most often focus on software based startups, with very little love for startups that make tangible things.

It is easy to prioritize bits in the age of information, however things that truly matter, such as producing food for 7 billion people, or curing a disease generally require mostly tangible components to exist.

Software can definitely increase crop yields and provide early diagnosis to a disease, however it generally requires more than just code — A robot, a new medicine, the rearrangement of atoms to achieve something.

If talented young people didn’t focus their energy on creating a billion (mostly useless) Apps with dreams of riches and focused on creating something new, perhaps we could have already cured cancer and created a cheap and abundant energy source (did I say flying car?).

The entrepreneurial community is also to blame. Garage inventors, makers and tinkerers have been neglected by investors and treated as second class entrepreneurs for a long time. This lack of respect to makers led a large proportion to abandon entrepreneurial aspirations and treat it as a hobby.

Strikingly simple opportunities are being overlooked or ignored. Let’s take a boring tangible industry as an example: Angle Brackets. There were no real innovations in the last 100 years. We now have technologies that can use machine learning and 3D printing to design an Angle Bracket that uses less material, is lighter, stronger, cheaper, and more environmentally friendly than all predecessors — just a bit of modern engineering used to create an impactful new product.

Imagine that a garage entrepreneur created and patented a plastic Angle Bracket that can withstand more weight than a metal competitor of similar size for 1/10th of the price. The entrepreneur will most likely attract less investor attention that someone that built a Tinder for dogs (Someone pitched it to me, it is real, MANY people are focusing their energy into a Tinder for Dogs variation, or yet another dog tracking collar — Oh the humanity!).

Shenzhen is the only place in the World that offers hardware startups a fully supportive ecosystem — if you have the right connections. Future trends are easily seen there. Hoverboards were big global hits in 2015–16, however Shenzhen had them for many years before it became a global sensation.

Silicon Valley entrepreneurs slowly abandoned Atoms (not only Silicon) and started to focus mostly on bits. China is investing heavily in robots and automation to maintain its place as the King of the Atoms.

Rapid prototyping tools evolved in similar pace to software development tools. Being in Shenzhen definitely helps to speed up the process, especially when it comes to finding parts and having prototypes built, however it is possible to launch a hardware startup without being there. Local hackerspaces can now support the development of fairly complex prototypes, however production still takes place in China.

Anyone that worked in the 1980s will remember Lotus 123, the predecessor to Microsoft Office. Albeit it was later sold to IBM, bits depreciate at unfathomable speeds. Many tangible assets from the 1980s are still being used and generating value.

New technologies and tools enable tangible innovations and new ventures without the need for large amounts of capitals. Investors need to take notice and start investing on atoms instead of waiting for Kickstarter to receive millions of dollars in pledges.

Join the rebellion and start to give atoms some more love.