VentureBeat: Why U.S. hardware startups will start moving to China

VentureBeat: Why U.S. hardware startups will start moving to China

Hardware startups seem to be “in” one minute and “out” the next in Silicon Valley. For years, venture capitalists wouldn’t go near hardware startups. They were, as Wired put it, “the ugly stepchild of venture capital.” This started to shift a couple years ago thanks to cheaper parts, rapid prototyping, and crowdfunding. However, the tide is turning once again. VC investments in hardware now seem to be slowing. We’re seeing a drop in funding to IoT, for example, and fewer deals in smart home hardware.

We’ve also seen some big failures in consumer hardware. Take Lily, a drone startup that raised $34 million in preorders in 2015 and announced in January that it will not be going into production. Or consider Google’s acquisition of Nest, which has been described as a “disaster.” Pebble is another example. The smartwatch startup sold to FitBit for a fraction of what it received during previous acquisition offers (and less than it raised in funding).

However, a drop in interest from U.S. VCs doesn’t mean hardware startups are left with no options. In fact, it opens up the opportunity to seek out funding in China, where VCs are not making the same mistakes. Chinese investment and home field advantages will spur the next era of innovative companies.

Here are five reasons why...

Techcrunch: Ruvento raises new seed fund to invest in hardware across Singapore, China and the U.S.

Techcrunch: Ruvento raises new seed fund to invest in hardware across Singapore, China and the U.S.

Today, Ruvento is announcing a new $25 million seed fund for hardware startups in need of capital from Singapore, China and the U.S. The fund, managed by Slava Solonitsyn and Alex Toh, will write 70 percent of its checks between $100k and $500k. The rest of the capital will be reserved for follow-on investments of up to $2 million.

Ruvento is not the first investor to take a cross-boarder approach to the hardware space. HAX, among others, has a large accelerator presence in Shenzhen. Meanwhile, it also operates a separate program in the United States for post-accelerator startups that already have their preliminary supply chains figured out.

Ruvento is particularly interested in infrastructure hardware. Specifically, the team believes there is a lot of untapped potential around IOT and sensor integrations. The firm also cites commercial applications of drones and robotics as areas of interest and plans to keep its eyes on startups creatively leveraging advancements in virtual reality and augmented reality to solve problems.

“Hardware shouldn’t mean gimmicks,” noted Slava Solonitsyn, managing partner of Ruvento. “We are not investing in things you don’t need.”