Boom, shake the room, Fire Nation, JLD here, and welcome to Entrepreneurs on Fire, brought to you by the HubSpot Podcast Network, with great shows like Being Boss. Today, we'll be focusing on creating a successful product with your invention idea. To drop these value bombs, I brought Kevin Maco on the mic. Kevin is the president of Maco Design in Advanced, established in 1999, and is the first company providing world-class end-to-end physical, consumer product development tailored to startups, small manufacturers, and home inventors.
He is also the host of the product startup podcast, and today we're talking about how he home and better can get a new invention to market, what the current status of the invention industry, the single biggest tip for developing a new product, and especially how can you get funding for your product, and so much more when we get back from taking our sponsors. Get your focus back, sleep better, and block out the unhealthy effects of blue lights with blue blocks, blue light blocking glasses. Get 20% off by going to BlueBlox.com slash Fire, or enter code fire20 at checkout. That's B-L-U-B-L-O-X.com slash Fire for 20% off or just use the code fire20.
The HubSpot Podcast Network is the audio destination for business professionals who seek the best education and inspiration on how to grow a business, whether you're looking for marketing, sales, service, or operational guidance, the HubSpot Podcast Network hosts have your back. Listen, learn and grow with the HubSpot Podcast Network at HubSpot.com slash podcast network. Kevin, say what's up to Fire Nation and share something about yourself that most people don't know. What's up Fire Nation, very excited to be on the show today.
Thanks John for the question. Before the last 12 months, I used to be on a flight once or twice a week going to various offices, keynote, all that sort of stuff. But given that I hadn't been able to do that for most of the last year, I actually used that extra time to get my private pilot's license. So I bring this up because the reason I got into it wasn't just for flying a plane, but the incredible learning opportunities.
See, the process of becoming a pilot is of course a great amount of skills and all that sort of stuff. But it's also a large part, like psychological training. It really pushes you to elevate your professionalism, discipline, ability to handle emergencies, and conquer fear, and basically to relentlessly always be prepared with multiple alternative plans. And I was already quite a disciplined professional, but I can certainly say that it's made me even more advanced as an entrepreneur, like even I'd say a husband and a father.
And I always say this to entrepreneurs. We all hear that lifelong learning is important, but just really know that whether it's becoming a pilot or taking a language course or learning something online, or you're just taking a shot at starting adventure, you will always take away far more than just the content. And you're a part of that right now listening to this podcast with JLD. I love that.
And it's so true. I mean, one of my favorites quotes that I use all the time is all the magic fire nation happens outside of your comfort zone. So you can't just live in this comfort zone, like things that you already know, just being in the ruts in the same routine, get out of that comfort zone, because when you do stretch that brain, that brain stretches, when you force it to, it never goes back in a good way. So love all this.
And we'll be talking today about creating a successful product with your invention idea, and Kevin Macco is a person to talk to you for this. So first off, I want to just ask you to give us an example of what a hardware startup is for those people that might not even be familiar. Yeah, so hardware startup to basically think of an invention, a gadget, a gizmo, stuff that can be sold in Walmart, Best Buy, Amazon, et cetera, right? It's the kind of the physical objects around you in your day to day life.
So we live in pretty crazy worlds. And a lot of things are going on. You know, I will say one thing that's been pretty interesting is people are still spending a lot of money. They're buying stuff, Amazon, eBay, you know, home depot.
I mean, you name it, like people are spending money. So if you're a hardware startup right now, what do you see as the current status of the overall invention industry? Oh, I love it. The hardware industry of the invention industry is going through a crazy, crazy revolution right now.
I kind of call it the perfect storm of opportunity for new product startups. And there's really boils down to six things that are happening at the same time, all coming together right now in this crazy storm. So first of all, love or hate it. Over the next 20 to 30 years, everything that you touch and see around you, look around your room right now, everything that you see from the chair that you're on or the desk or the window that you're looking out of, it will all be connected.
There will be chips in everything, maybe in a very small way, like saying, hey, your coach cushion needs, you know, replace or in a large way, we're already seeing with many products like the Nest Thermostat, right? So much happening in terms of the space of innovation and the opportunities are available, but that's just one of them. But in addition to that, you know, there's other things. First of all, the product design tools, the software, the prototyping techniques, all that are making it easier than ever for product developers to make client inventions real, right?
We've got advanced CAD design tools, simulation software to ensure products are high quality. You've got all these kind of crazy prototype parts, like metals and advanced materials that we can use. So just the development in itself is going through a revolution to make it just that much easier to design a great product, but also test what the outcome of that product is going to be from a physical perspective. Three, big companies are spending far less money on research and development, but much more money on acquisition of small product companies.
Think of the Nest Thermostat, think of Oculus, REF and all these things, even if there's that sponge, right? That was sold for millions of dollars. It was literally just a cleaning sponge. Is that the magic sponge?
You got it, the other one. I've heard you mentioned it on the show before, so that thing is absolutely unbelievable, right? So again, it's an example where companies are looking and saying, let's let the world innovate, and then we'll just buy those great innovations as they come out and they get market validated. So fourth, there's more support than ever before.
Hardware incubators, maker spaces, hackathons, co-working spaces, colleges and universities, like product innovation programs that the list goes on, right when I started this business 20 years ago, up until today, there are over 100 times more entrepreneurship incubation centers around the world than they were back then. I mean, this is just one example of how much support there is never before, including things like, you'll fire and JLD, your book obviously, which is literally laying out a roadmap for how entrepreneurs can succeed, right? So five, this is a big one, especially when it comes to hardware, is additive manufacturing. So manufacturing like 50, 100 or 200 units at a time, locally, quickly, so that you can test those units in a real market.
Far cheaper than traditional manufacturing, and obviously the big bonus though, is it allows you to iterate and improve before you go into your bigger and more capital-intensive production runs for larger volume. Next, crowdsourcing. Think Kickstarter, go go Shopify, Amazon, all this sort of stuff. There's so many tools to get your invention directly to consumers now.
Again, this was 20 years ago, very, very rare, almost impossible to do, and then well before that, even more difficult, right? So these really, if you look at those things above, those are six things that are all coming together at the perfect storm all right now in 2021, creating a tremendous amount of opportunity over the next four years for those who kind of take advantage of that. And I can just remember looking at the landscape back in 2016 and being like, okay, I wanna bring this journal to market, like what's a great way to do this for the Freedom Journal? I said, well, what are these new crowdfunding things are going on here?
And using Kickstarter and getting on that platform and then getting promoted by them, and then just having the validation that people did support this project and it didn't get fully funded, they were getting their money back, so there was literally no risk, they were really gonna get the product, or they were gonna get their money back. It was like a really cool way to get something out there into the world and get proof of concept and all of those things. So like with that, Kevin, and just with everything else you're talking about, how does today in 2021, a home inventor get a new invention idea to market? It's a really interesting conversation because it's one of those things where, if you search around on Google, it's actually very difficult to figure that question.
It's almost more disinformation than there is information out there. And it's not just at any fault or anything like that, it's just that it has evolved very quickly, even so much as to the last couple of years of what's happening. So the short answer to that is, if you've got a product idea and you're trying to make it successful in some way or not, there is only one way that works in 2021, and that is to get to manufacturing. There is no get rich quick scheme, no shortcut, nothing else, develop your product, get into production, manufacture even just a few hundred units and get real people to whip out their credit card, purchase a unit, and then most importantly, get reviews from those people of how much you love your product.
And from there, then of course, you can talk all kinds of scaling options, like licensing, distribution partners, wholesale, retail buyers, brand collaborations, whatever else. There's lots of options beyond there, but the key thing to really drive home is that all of that happens after manufacturing. The key is, as a startup, your goal needs to be, okay, how do I go from this, sketch on an Appian or whatever I'm at, this rough home built prototype, how do I get from there to production? And I know it might sell in kind of daunting, but today here with JLD, that's what we're gonna go through.
I'm gonna talk about both technical perspective, how do you actually do it in the back and how you build that, and also how do you do it financially? How do you actually make that happen? Fire Nation, this is why I love bringing people who are the masters at specific topics, specific areas of expertise, because then you get to follow the proven path, you get to follow the common path, they get to your version of uncommon success here today, with Kevin Maco. And so you know, I like the biggest tips, Kevin.
So give us the single biggest tip for developing a new product in 2021. What is that? All right, the big one. Well, John, I think you're gonna like this one.
I've heard you talk about it a few times, you've got an acronym for it, but when it comes to hardware, and this obviously applies to software, service based firms as well, but when it comes to hardware, the number one thing when you think about developing your product or even thinking of your features is focus, focus, focus. I mean, this in hardware is particularly important because it is very difficult at the end of a development cycle to make very quick, cheap adjustments if you haven't focused out of the gate. And I wanna give a few examples of this. And one of our clients, Go Fish, Underwater Fishing Camera, awesome thing, you can buy it all over the place now.
They took a market that already existed and they really just narrowed down on a very tiny niche focus. How do we get a camera that has a very basic feature set, to work underwater that literally attaches to your fishing line so you can see what's happening. That's it, nothing else. They relentlessly focused on that and they've obviously become a huge success and they actually ended up exiting and selling to a bigger company.
A very simple example is whatever clients call the tri-plunger. He literally looked at plungers and said, why are they round? They should be triangle shaped. My toilets are now triangle shaped.
That's it. This guy, great guy, actually addressed it, actually addressed it, walks into a big retailer, his first method of trying to sell this thing, walks in with boxes and I talk to the manager. Huge box, these plungers, I've got way better plungers, you should be selling these things. The manager goes, you know what?
I do have a little bit of liberty on what I buy. I'm gonna buy that box off you, we'll see how you both. And that was the start of the success story. Crazy, right?
So, you know, and then I give you a talking niche, I look at her own story with macro design. So 21 years ago, you know, I was trying to struggling to get an invention developed, classic kind of story, you know, startup story. I was having my own problem. I said, okay, how can I solve this problem?
I very quickly realized it was like nearly impossible for an invention startup out there. Like impossible to get your product developed to production. So I had this vision, how do I create a world-class full end to end physical product design firm that was tailored exclusively to startups and inventors. Basically, a niche within a niche, right?
We're in the product design field, but tailored only to mass manufacturer consumer products, stuff going to Walmart and whatnot. And then specifically four startups. And everyone I talked to in the industry back then, they basically said, oh, that'll never work. That's way too tiny of a niche, you know, any firm that's either that size or that caliber, level and both, you know, it's all about the big Fortune 500 product clients and you know, those big revolving contracts.
They say everyone have boys and vendors and startups like unless they really need them to help pay some bills. And then of course, you know, you gotta get back to your big corporate clients. And right then, I knew I was on to an untapped niche. So, you know, I went out of hiring very specific, very niche builder designers, senior folks out of Del Boeing, Bose, Nike, Bosch, Prokker and Gamble, Mattel, others.
My bill processes to develop products from sketch to store shelves, foreign vendors. I connected with all sorts of like organizations and stuff that could help startups, you know, with the pieces they were missing in their journey. And although it was super niche, it worked. I mean, since then we've worked on over a thousand products, we have four offices, we have coast to coast, millions of units and people's hands all over the world, you know, 20 plus awards and so on.
But it really just goes to show you the sheer power, you know, whether it's hardware or service or software, but the sheer power of niche in 2021. The sheer power of niche, and I want to just double back to something Kevin said, focus, fire nation, follow one course until success. Things are so powerful. In fact, discovering your niche is step two, chapter two of the Common Path on Common Success for a reason.
Focus is the word that I use most for a reason. And that's why you need to listen to people like Kevin. And of course myself, when we're telling you these are the things you need to be zeroing in on when you're creating your invention idea. Now we have some awesome things coming up as soon as we get back from thinking our sponsors.
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Kevin, we're back and I've been hearing this thing floating around the universe called a new consumer product. So before we go any further here today, give us an example of a new consumer product. It's these inventions, right? You're intending to take this physical idea, this gadget, this innovation that you have in the physical world and then releasing it to the market so that end users can buy it, right?
So that the world essentially can buy that physical thing that you've created, that idea. What are those steps involved in developing this new consumer product? This is where it gets cool. So I'll go through kind of, we'll do it in order from, you know, coming up with the idea to production, right?
So because in physical product development, it's also a bit uncertain as to what those steps are too. So we're just gonna lay it out, but also in order, right? First things first is identifying the opportunity, right? Some people are very fortunate and they've just been walking through their day-to-day lives and they see something, right?
And they've just, they've come up with it, right? A lot of the clients that we have come in, they really, they're just almost somewhat stumbled on something that they realized was a pain point or whatever else, right? Some of our clients have been sitting on these ideas for years, right? They've been in their back pocket, they say, oh, one day I'm gonna do something about that invention idea and then just wait, right?
And then I'd say if you're still kind of searching, you know, if you're interested in the product space and this could be whether it's a hardware thing or anything else, software, any business. The best advice I give is just, you know, keep an eye out in your day-to-day lives and in your work for inconveniences that affect you. When that happens, don't just say, oh, that's annoying. Look at it and say, how could I actually solve this problem?
Right? So, you know, first things first, come up with that invention idea. Once you've got that idea, come out, second step is, just sketch it out. That's the easiest thing you can do at home.
Do some Google research, sketch it out, just the basics, right? You're trying to just bake out that idea a bit on paper. Third, this is where it kind of starts to get serious. When you say, okay, look, we're gonna do something with this.
And this is what's called an industrial design phase. An industrial design basically means visual design to how the thing actually looks, combined with functional logic. How do we actually plan to build an engineer that thing? And that's done through software called essentially computer-aided design or CAD software.
This is essentially digital software that allows us to do the 3D renderings and actual builds. Now, this is by far the most important step. This is where you want a number of very senior designers and engineers to really figure out three critical things that form the foundation of basically the future of your product. This CAD design is the actual same model, which then gets iterated and refined all the way through to production and even into subsequent prototypes.
So three things that are key is one, the key features. Again, focus, keep it simple. Very, very niche focus. Second, visual or cosmetic look and feel how it integrates with these features.
And then third, exactly how these things are going to physically work, which then leads into the next step, which is mechanical engineering. And if you have electronics, you're also doing electronic engineering. That's kind of like the detailed run work on building out every little mechanical and or electrical detail of the industrial design that's been done. After that, you're under your rough prototype.
This is where it comes alive. This is the first time that that thing is a real physical thing. But this prototype is really just starting to be used to muck about with it, make sure, figure out what you like, what you don't like, have some conversations and around the features, that sort of stuff. And really, if you have any kind of test or experimental mechanics or whatever, making sure that those are working.
Now, that leads into your full and final prototype, and which you may do more than one, but usually speaking for most mass-manufacture consumer inventions, if done well, can be done with probably just one final prototype. But this is one where I've done correctly. It should be very close to a production unit. This is both used to sell and market it, but also internally, you want to be thinking about using that to refine any last minute details in testing it before you're actually going into the final step, which is manufacturing of that product, getting units made so that people can buy them.
By your nation, this kind of step-by-step process, this kind of flow, this is just exactly what you need when you want to take your invention, your idea to market, like the step-by-step process. Now, I want to talk about best options, not just any options, Kevin, the best options. What, according to you, are the best options for those looking to sell a new product to the market today. Yeah, that's a great question, because when you're coming up with those initial ideas, you should be thinking down the pipeline, like, OK, how am I going to sell this thing?
How do I actually monetize this? And I would say first and foremost, and also most exciting is crowdfunding. This is a phenomenal tool for hardware startups, because basically what you're doing is you're putting your finished product prototype, from the phases of before. You have your finished, nice prototype, right before you're ready to go production.
You're putting that to the world. And then you're having people who are really interested in this pre-purchase your product, at which point you use that money to fund the production run, which then can occur many months down the road. Now, a really important thing to remember here is most of the crowdfunding platforms, especially the big ones, they all require you pretty much to be ready for production before you post on their platform. So that's one thing.
The other thing to consider is you need to work to sell that product once it's on that platform as well. It's not a set-it-and-forget methodology. You really have to use that as a tool to leverage up to get your first few users. Now, the key is you don't have to sell a ton there.
You just have to show a few to get real buyers using the product and saying that they love it. Another option that is good as well, but I really think crowdfunding is one of the best. But another option, which is good, is Shopify, Amazon, et cetera. These are very easy to use tools where, of course, you have to have units in production.
When you do, it gives you a direct line straight to the consumer. It gives you strong feedback loop in the way of reviews as well. So people love it. You can leverage that.
And if there's some issues, you can iron out those issues while building your next version of the product. But as always, I recommend building a great product first, a very simple, clean, focused product first, a very high quality product first, so that you start with raving fans. And then from there, if you've done those first two things well, what's really amazing is you can leverage that success to start talking to those wholesalers or distributors, which in hardware is really different than any other industry. Because you can have tremendous scale.
You meet the right buyer, and you can go from 500 unit order to a 5,000 unit order on one decision maker. So the scale when it comes to distribution and wholesale and all that is big, which of course, leads to what everyone always is thinking of at the very, very end is, well, how do I then get into retailers? If you have to understand that retailers is like the end game. That's once you've gone through those steps, and you've proven that, that's when you can start getting into retailers.
A lot of the time you're doing that through your wholesalers, your distributors. But retail, to get direct is possible, but you really have to prove your model. And then that's when you get to the big stuff, like selling directly to brands or co-branding, or even white labeling under another brand, where you sell it to them, and then they use their brand to sell it onwards, and licensing deals and all that sort of big stuff when you actually scale from there. But really that order above is kind of key, and it all kind of starts with getting your first view.
Doesn't have to be a lot of first few units out to market to get those braving fans. Now that is exciting, Fire Nation, to think about that end result when you're actually going through those final steps that Kevin's talking about. I mean, that's the dream. But Kevin, let's be honest, some people's dreams need a couple of dollars and cents to even start to make that reality.
So let's end today by talking about funding. What are the smartest ways to fund a new product development project that you've seen in action? Yeah, funding is a big question. And the first thing I want to heart-bone when it comes to funding is like, don't be discouraged.
I would say that more than half of the clients that work with Mac design don't themselves have the funding to go all the way to manufacturing. That is OK. It's a normal part of hardware design and development. And I can kind of break down how you pull that off in a moment.
For those of you that have funding, you're in a great position. As you're saving all of your equity from when things get serious, when you actually get into production and sales, then you can look to say, OK, I'm going to keep this business going and just use it as a cash center, or I'm going to sell it out right, or I'm going to raise a big funding round to really scale it up. That's great. But for those who don't have the funding, hardware design has some very key milestones that you need to hit to consider different types of funding rounds.
So I'll go through them in brief. First things first, nobody professionally funds an idea at the idea phase. So first and foremost is the CAD design. You pretty much have to do this yourself.
And if you can't financially afford this yourself, then you are relying on friends and family who trust you, not even necessarily ideal, though that's the cherry on top, but trust you to actually execute on building the thing and getting it to production, which is always the end goal. So first things first, if you're building the design, the CAD design, some of the early engineering, that sort of stuff, absolutely that is on the startup. And that's the commitment that more serious investors are looking for as you go down the road. The next milestone is your rough prototype.
We talked about it above. That's an interesting time, because you actually at that point have a little bit of meat on the bones to go to certain types of angel investors or certain types of very small micro-institutional investors or that sort of thing. And say, look, here, I've got an in-development of this product. I'm, let's call it halfway through development of this product.
We've got a unit quasi-working here. We've proven the technology. I have some people saying that they would love it, that they would buy it, that sort of thing. And would you be interested in an equity financing round at that point?
So that's where you actually have some meat on the bones. You may be able to pull it off after the CAD phase if it's really well designed, really well engineered. But that's fairly unlikely. More than likely, an investor wants to see the thing in their hands.
Then you get to the final prototype and pre-production. That's where things get serious. Because if you can prove that, hey, look, I've got 500 people buying it on crowdfunding. I fully engineered the product.
We're ready to go into production. I now need money to scale. That's where you start to get into very exciting conversations with potential investors. Because you've essentially alleviated the development risk.
Now they're looking at scaling risk. How much do I believe in the product? How much do I believe in you? How big do I think the market's going to be for that?
Whatever. That's the conversations that get serious. But where it gets really big is when you're in production, you have real users that have your product. And they say, I love to say.
I'm using it. And it's an amazing product. I think of our client, the moonlight. It's a very simple product.
It's a viewfinder that you put on top of your phone. It used the flashlight on your phone to tell children stories on the roof. She came to us with the idea, developed it through. She did a crowdfunding campaign, sold a bunch of units, people were loving it.
Raving fans, that sort of thing. Spin Master toys buys and sells in 70 countries overnight. That is the key. You want to get into the big conversations?
Prove that people have bought your product and love it. That's the key. I mean, that proof of concept is so key. Like, for instance, when we went through Fire Nation and had over 4, like 300 orders of the Freedom Journal, that allowed us to have the faith to go ahead and place this massive bulk order with our manufacturer.
Because we knew that there was absolute demand, absolute proof of concept. So I loved how you walked us through all those options and all the funding that you can potentially be going through. And hey, sometimes you just got to kind of cozy up to Uncle Joe or Auntie Samantha and say, hey, let's talk a little business here. Because I got this great idea.
If you believe in my work ethic, if you believe in this idea, then this could be something really fun and enjoyable and awesome for us down the line for obvious reasons. Now, Kevin, you talked about a lot of awesome stuff here today. What is the one takeaway that you want to make sure Fire Nation gets from everything that we talked about? Then please take a second.
Tell us how we can find out more about you and everything that you do in this world. You have to call to action you have for Fire Nation, and then we'll say goodbye. As a quick kind of a side, everything we talked about that really helps with, the number one thing that I've seen in all the thousand plus startups I've worked with is prioritization of energy. Consistently and in the day you mentioned it, put in the reps, right?
Every day, put in a little bit of effort to the most important things of getting your product launched. And you'll make tremendous strides over the coming months. So in terms of some help with that, two quick things. One, I'd love you to check out the product startup podcast.
If you're interested in hardware, it's an industry's leading podcast for the new product startups in the hardware development space. It's just productstartup.com. But also, if you are interested in getting your product developed, Gail, I've been listening to your podcast for years. You have been an inspiration, your guests have been beyond inspirational in many different ways.
So I want to do something for the hardware startups of Fire Nation. So if you go to our website and you're interested in developing your product, go to MacoDesign.com slash fire. That's makodesign.com forward slash fire. And I'm going to do three things.
One, we normally do a free consultation, but I'm going to make sure that's with our senior product strategist. So in addition to that, something we don't do is we're going to actually do design an engineering consult with you, whether it's visual, mechanical, electrical engineering or all, depending on your specific type of product. We're going to make sure that we at least give you that direction. And then three, something I've never offered before, but for any hardware startup that hires MacoDesign to develop your product, I will personally mentor you and your startup business right from day one to your first production run.
You know, as EO fires provide me with a ton of value over the years. So I'm very excited to basically help the next upcoming EO fire startups get off the ground and return. Fire Nation, this is it. This is the opportunity that you have been waiting for if you fit to those parameters that Kevin's been talking about all day today.
So please get out of your comfort zone. Please know that all the magic happens outside of that comfort zone. Check out MacoDesign.com slash fire. M a K O design.com slash fire.
Of course, his podcast has all the good stuff, the product startup podcast, product startup.com fire Nation knows the way the average of the five people we spend the most time with and financially hanging out with you, Kevin and myself today. So we need to make sure they keep up the heat and how you do that. Fire Nation is a head over to MacoDesign.com slash fire M a K O design.com slash fire fill out those forms. Many things are amazing.
That third and final thing being personally mentored by Kevin. He's never offered it before. This is from starts all the way through. I want to hear from whoever qualifies for that because man, that is baller Kevin.
I want to say thank you brother for sharing your truth, your knowledge, your value of fire Nation today for that. We salute you and we'll catch you on the flip side. Thanks, John. Take care.
Hey, Fire Nation. Today's value bomb content was brought to you by Kevin and successful entrepreneurs. They accomplish big goals, which is why I created the freedom journal to guide you in a college and your number one goal. And we're talking a hundred days and we're talking step by step.
Visit the freedom journal.com use promo code podcast for a $15 discount as I thank you for listening to my podcast and I'll catch you there. Or I will catch you simply on the flip side. Get your focus back, sleep better and block out the unhealthy effects of blue light with blue blocks, blue light blocking glasses. Get 20% off by going to a blue blocks dot com slash fire or enter code fire 20.
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