I remember reading a postmortem about a failed hardware Kickstarter campaign (some photographic accessory: a flash remote?) and they said they contacted a professional manager from the industry who told them he wouldn't even try developing new hardware without a few million in funding, tens of millions being more common. So there, turns out making new hardware is really expensive.
The product could've easily been made on their budget. Their problem was outsourcing much of the development work, so they paid consultants too much money to make something that was overdesigned and way too expensive to make. When you're starting in hardware, you need to immerse yourself in the whole chain to be able to make good decisions. Shame, I liked the guys.
Wow, pretty bad advice they got... The little company I work for does high end microwave equipment (satellite terminals, RF conversion equipment, 5Gbps ultra-low-latency terrestrial links used for high frequency trading, etc.) and only turns over a few million dollars per year...
I would be surprised if a flash remote cost more than two or three hundred thousand to develop and productise, tool up and do a small production run, but that's assuming you have a team with the right skills. If you're paying contract design houses then I guess it would be a lot more expensive.
As I understood the advice, that's what kind of budget it usually takes, at least in the industry of photography, to reliably create a new hardware product with the level of polish that the market is used to.
Yup, it is amazing how quickly a few $10k tools, $3k tooling modifications, and sample shipping costs quickly adds up.
I laugh at most hardware Kickstarters because what they are trying to do is impossible with the funding levels you are going to get, so if it is going to be successful they should already have investors in which case they Kickstarter is just a cheap marketing campaign.
