Is There Hardware Startup?

Are hardware startups disappearing?
No, but being built like software startups is killing them

Right now, the startup world is dominated by software and AI.
- That’s where the money is.
- That’s where the speed is.
- That’s where everyone is being told to move fast and figure it out later.

In 2025, AI captured 48% of all venture funding. And in Q3 2025, about 33% of Carta-tracked venture funding went to SaaS, versus 16.5% to hardware.

So founders absorb the same startup logic over and over:
- Launch early.
- Iterate fast.
- Fix it later.

Great advice… if your product lives in the cloud.

Not so great if it needs tooling, suppliers, certifications, production planning, and someone to explain to a factory why Rev B is now Rev C. Because hardware doesn’t “iterate” the same way software does.

A software mistake becomes a patch.

A hardware mistake becomes:
- a tooling delay
- a quality problem
- a batch of wrong parts

...or 3 months gone because someone thought manufacturing was the easy part. That’s the real issue.

Hardware startups are not disappearing. But more of them are being built in an ecosystem that keeps rewarding software assumptions - and that usually means manufacturing gets serious attention far too late.

For hardware, manufacturing is not the boring part that starts after the product is finished. It’s part of the product. And if nobody is close enough to the factory to catch problems early, they usually become expensive problems later.