A Pittsburgh-based start-up accelerator is taking a somewhat novel approach to building new tech companies — it is focusing on computer hardware.
“Investors have always been concerned about technical risk when it comes to hardware,” says Ilana Diamond, managing director of AlphaLab Gear. “They’re obviously very hesitant to invest in something that might not be doable. But they’re also hesitant to invest in something that hasn’t shown technical traction in the marketplace. We can help in both areas.”
Diamond seeks out start-up teams that can develop a fundable plan in a reasonable amount of time, which has much to do with identifying an appropriate customer for a piece of hardware. For example, entrepreneur and engineer Avishai Geller approached AlphaLab last year with a contextually aware headset, pitching it as a personal assistant for your ears. “He wanted to make it a consumer product,” says Diamond, “but we thought that would be a tough sell. So we helped him explore other markets.”
Geller’s technology fell into an unlikely white space: the trucking industry, which has a serious problem with drivers losing their reflexes or nodding off during long trips. AlphaLab saw an opportunity to use Geller’s smart headset to alert drivers when they doze off or begin showing potentially dangerous symptoms like a heightened heart rate.
Maven Machines, Geller’s company, quickly found three trucking companies interested in his product.
“Everyone wants to go the consumer route at first, but with business-to-business deals you might sell 1,000 units all at once,” Diamond says. “It gives you a chance to learn before your product hits the consumer market.”
In addition to providing seed funding, AlphaLab mentors its companies and gives them a fresh new perspective on launching a start-up. “[Founders] have to get away from thinking about how cool their product is and start thinking about what problem they’re solving,” says Diamond. “That means listening to customers.”
Source: ZD Net
