A Look at Ten Hardware Startup Blunders, Part 3: Team

At Embedded Artistry, we've spent countless hours meeting with founders, working at startups, and swapping war stories with fellow engineers. After enough iterations, we started to notice a repeated set of critical strategic missteps made by new hardware companies. These missteps result in compromised designs, increased development costs, and continual schedule delays.

We've selected ten mistakes regularly observed at new hardware companies which fall into three general categories: process, focus, and team. This article is the third in our four-part series and focuses on team-related mistakes.

Team-related Mistakes

Building a team which can execute on your company’s business goals is a challenging task. Team composition can make or break a new company due to the serious cash flow constraints they face. Companies must focus carefully on hiring to ensure they have a mix of senior and junior engineers while also building a balanced team focused around the core business value. Hiring recklessly or staffing up too quickly can become a serious drain on company resources and morale.

The following three mistakes related to team composition are among the most common we encounter at new hardware companies:

  1. Committing to a schedule before having the execution team
  2. Hiring junior or mid-level engineers and expecting senior-level work
  3. Attempting to build a full-stack engineering team

Committing to a Schedule Before Having the Execution Team

In the previous article, we discussed how teams can build an unworkable schedule by focusing exclusively on hardware development milestones. Another major scheduling mistake is committing to a schedule before hiring an engineering team to execute your plan.

Hardware startups often base their schedules around market timing or investor expectations. The schedules are entirely fantastical, since teams construct them without input from the engineers who will be designing and building the product. Fundamentally, the company has agreed to deliver a product before having the ability to produce that product.

Teams making this kind of overly-aggressive schedule also exhibit unrealistic expectations for the time it takes to hire engineers, especially firmware developers. Young teams often think they can fill an engineering position in 2-6 weeks. Reality is not so kind: in the San Francisco Bay area, we find that it takes between 3-6 months to hire for each firmware engineering position. If a team’s schedule is dependent on quick hiring, reality will expose the plan as impractical.

When the leadership team sets the schedule without input from the actual engineers doing the work, and the hiring takes longer than expected, the new engineers that join the team are immediately put under pressure. The firmware is almost always “late” by the time the first engineer joins the team, and everyone else on the team is anxious to see the system working. This situation leads to conflicts, cutting corners, unhappy engineers, and delayed releases.

Your schedule is ultimately dictated by the capabilities of your team and the staff you have on hand at the present moment. You need your team’s input when creating the plan. Keep these facts in mind and create a schedule that matches your team’s realistic capabilities.

Hiring Junior or Mid-Level Engineers and Expecting Senior-Level Work

The most common mistake we see young hardware companies make is hiring junior or mid-level engineers and expecting them to produce senior-level work. This can occur because the CEO is not aware of a senior engineer’s value, because the schedule “necessitates” beginning work without senior engineering guidance, or because the team gave up on finding a senior engineer after a long search.

Hiring a senior engineer is essential for the success of a project, especially in today’s world of highly interconnected systems. These companies simply must start with someone who has shipped products before and led the whole process first hand. Junior engineers lack the experience, perspective, and design skills necessary to architect and build new systems. When someone with underdeveloped engineering and design skills builds a system, the most common result is a hard-to-maintain system held together with duct tape and prayers. What’s under the hood often resembles a shanty town, not the 5-star hotel the CEO envisioned. New features become increasingly difficult (or impossible) to implement due to the fragility of the system. When you add multiple interacting systems into the mix, the resulting design problems can multiply and prevent you from shipping your product.

Senior engineers have the experience and foresight to set requirements and identify critical design problems before it’s too late. They can provide guidance to junior engineers and ensure that they aren’t overtaxed. Senior engineers are also crucial when working with contractors, design houses, and other external suppliers. Junior engineers may not have the experience or perspective to review the work products, judge whether the quality is sufficient, and determine if the design satisfies the requirements. Having a senior engineer to manage the work of external teams acts as an insurance policy against integrating low-quality work into your system.

If you want to avoid schedule delays and hard-to-maintain systems, you must have senior engineers on staff.

Attempting to Build a Full-stack Engineering Team

Many new hardware companies focus on building a full-stack team that can handle all aspects of product development. As my friend Saket Vora pointed out, companies should instead build a team that focuses on their core business value.

Most small companies outsource accounting, bookkeeping, and payroll activities to external firms, since they do not directly contribute value to the business. For most new hardware teams, they can likewise outsource the bulk of firmware and hardware development to consultants, contractors, and design firms. Given the difficulty in hiring senior engineers at early stage companies, utilizing external experts can also help alleviate the problem of expecting senior-level work from junior engineers.

Unless your company’s focus is innovative firmware or electrical development, writing firmware and designing circuit boards does not add direct value to your business. Your team will need one experienced engineer who can integrate and review the outsourced work. Your remaining full-time engineers should be fully focused on feature development, integrating with external services, and improving the customer experience.

Another aspect to consider is whether you can justify the employment of your full-stack team. We’ve repeatedly seen companies hire multiple full-time firmware and electrical engineers and successfully keep the team busy while shipping the first product. As efforts shift from new product development to feature improvements, marketing, and customer support, these engineers find there is no work for them to do. If you don’t immediately have the second product on deck, the under-utilized engineers get laid off, leave the company because they’re bored, or simply hang around and serve as a drain on your runway.

Headcount is a precious commodity, and it can quickly turn into an anchor on your company. Make sure you carefully build your team to deliver on your core business value propositions. You don’t get style points for doing it all in house, and the customer can’t tell the difference.

Next Up

That’s it for common team mistakes. Next week, we’ll summarize our list of ten common blunders and provide resources for teams that wish to learn more about product development and project management.