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Maker Business – The Real Costs

Maker Business - The Real Costs

You know me, I’ve always got more to say… I just wanted to touch on the real costs of making a thing.

In the olden days, when I primarily worked with software, there was an old saying “Linux is only free if your time has no value” and while it’s a slightly amusing phrase, there maybe some truth to it. Maybe. If you’re a Linux fan, the saying may come across as an insult. Sure, sometimes working with Linux feels a lot like yak shaving. When you need to install this library to install that library to install some other library to install the software you really wanted to install… you get the idea. (Linux has gotten much better at this in the last few years though, so much of these issues have gone away.)

With software, it’s (almost) all about the time you spend on it. If you’ve got a computer, you can develop software. Most of the tools are free, or low-cost (depending on the platform) and if you got access to the Internet, or a library, you can learn, learn, learn and become a software developer. (I’ll answer the question of if you should in another post!)

So you’ve got a computer, you’ve got time, you’ve got a desire to learn… those can be the basic building blocks to make software. Go for it. Now, keep in mind that many developers (especially in the open source world) are doing what they do because they want to solve their own problems. I really wanted DokuWiki to be able to present a random page, and when I found a plugin that didn’t work, it was worth a few hours to fix it. I didn’t go as far as adopting the plugin, since it appears to have been orphaned, but I did drop it on GitHub so if someone really wants my work, they can have it. The sharing and collaboration is part of what I love about open source.

So let’s talk about hardware…

Hardware consists of real bits, not just zeros and ones, but actual physical things that are created. When I turned one of my projects into a product I did my best to make sure the final price was such that I would actually make money. Making money is important. Note that I didn’t say making LOTS and LOTS of money is important. I mean, it is to some people, but… whatever.

So you’ve got your maker business, and you want to treat customers (and potential customers) right, and this will cause you to make certain decisions. I remember talking to someone 9 months ago who ran a successful Kickstarter campaign, and he pointed out to me that the first thing you need to do once you think you determine your costs, is to pad it. Remember that Kickstarter and Amazon each take a cut. The campaigner also said that he got one backer who had some terrible thing happen in his personal life, and asked if he could be refunded his pledge. If you do refund someone’s pledge, do you do the full amount or do you withhold what Kickstarter and Amazon take out of it?

Once you’re shipping actual products, if you’re not charging enough, how many returns does it take to make you start losing money? Things break during shipping, or get lost, or stolen, or just plain don’t work. It’s your job to determine how far you’ll go (and how much you’ll spend) to have satisfied customers.

And yeah, as I mentioned, physical things cost money, and when you are not big (as in, a small company, or someone just starting out) you probably have zero leverage to get any sort of discounts. This is where a lot of Kickstarter campaigns come in, as they involve raising enough money to do bulk purchases to drive down costs. It’s a good idea in some cases, but not all.

Even after you have all the physical things you need to assemble a product, there are at least two more thing you may need. Time (just like with software) and tools (which compare to a computer in the software example above.) In my case, to build my products I had some of the tools I needed, but I also had to buy some of them. If you don’t want to buy your own tools you can consider a makerspace or something like TechShop if you have one near you. As you continue to create your product you may end up spending more on tools, to do things better, faster, etc. This is another cost you may not think about. There’s also repairing and replacing tools, and consumables like blades, bits, paint, shipping materials, etc. and each one of those also takes some time. If you’re driving to a store, or even just ordering online, that’s time, and if your time is worth anything, you need to be compensated in some way.

I’m all about DIY, when it makes sense, and sometimes even when it doesn’t make sense, and that’s the key here. Sure, time is money, and yak shaving isn’t always the best thing to do, but sometimes you do it anyway. The good thing is, everyone has a different scale of what they are willing to do (or what they can do) and what they are willing to pay someone else to do.

I’ve gone off the rails a bit, and I guess I’ll need to do a 12.5 post to continue this. If it’s a bit rambling, forgive me, I’m still thinking through a lot of this.

(See all the posts in this series: Begin, Stock, Buy Smart, Basic Rules, No Leeway, Be Open, Community, Manufacturability, Marketing, Shipping, Lessons Learned.)

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Leap Motion

Say goodbye to your mouse and keyboard.

The Leap Motion looks interesting. OK, it looks awesome. Sort of… I mean, I’m all for “new” interfaces for computers, but the whole “say goodbye to your mouse and keyboard” bit? I don’t buy it, and I don’t want to buy it. More accurate than a mouse? Again, I’m not convinced. And as for the “more natural” part of it, while it’s true I’ve been using my hands and fingers my entire life, I’ve been using a keyboard for more than 30 years, and a mouse for over 20 years, and at this point, it’s pretty damn natural. Nothing feels “unnatural” to me about using a keyboard and mouse. If something better comes along, I’d be happy to try it. The iPad does a really good job of using a touch interface, and for specific tasks, it’s wonderful, and much better than a keyboard and mouse, though I feel a lot of that has to do with how and where I use an iPad.

In the air

I’m not really sure how signing your name or writing in thin air is natural or better/easier that the alternatives. Sure, it looks like it could be fun, and I do see the possibilities for new things, but I made the joke(?) yesterday that what we really need is a method of using computers that requires us to keep our arms in the air for 10 hours a day. I know we should all use standing desks and be on the move, but I also really like sitting at a desk, supporting my arms, and using a keyboard and mouse. For the great majority of what I do with a computer, it works well.

Alright, with my complaining out of the way, I’ll heap on the praise now. I love this thing. The Leap Motion opens up some possibilities. We’ve played with 3D scanning using the Kinect and while it sort of works, it could be better. Hell, if the Leap Motion can do at least as good as the Kinect at 1/3rd the price, I’m sold. (Also, it’s not a Microsoft product, so it earns points there as well!) I can also see using the Leap Motion with Processing as a great physical computing device. Yeah, I’m excited. $70? That’s cheaper than some Logictech mice!

So while I’m not ready to ditch my keyboard and mouse yet, I can see some great possibilities in the Leap Motion. I’m not exactly ready to (pre-)order one yet, as it’s sort of vaporware at this point, and they don’t expect to ship until December 2012 or January 2013. That’s 7 to 8 months out, without any dates slipping. (Dev kits may be out in 1 to 3 months, so there’s a chance we may get a better idea of what it can really do at that point.) The pre-order thing makes it feel like a really long Kickstarter campaign, so I’m taking a “wait and see” approach on this. Things move fast, and who knows, within 6 months a competitor may come along with something better. Still, it’s damn interesting.

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Business Cat Explained

Business Cat

The other day I was playing working with our IR thermometer which just happens to have a laser built into it, and the cat decided it was some sort of toy. Obviously there are laser pointers sold as “cat toys” but dammit, the IR thermometer is a serious tool for science!

Anyway, I told my daughter that on the Internet there is a picture of a cat and the cat is wearing a tie, and behind the cat is this multicolor background, and the cat looks really serious, and he is a business cat, and the caption says “I need you to stay late tonight, we really have to catch that red dot.”

I thought it summed up the current situation nicely, but somehow I don’t think the words had the same impact as just seeing the image.

And then I felt bad for people who are sight-impaired and can’t enjoy these goofy photo memes.

And then I felt envious of people who are sight-impaired, because maybe they aren’t wasting precious minutes of their lives seeing these stupid pictures of cats/animals/people/Willy Wonka with captions.

And then I thought about building a text-only web site that just explained these pictures in great details…

And then I thought about building some sort of phone service using Twilio to explain memes to people verbally.

And then I probably ate a cookie or something and forgot all about it.

You’re welcome.

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Conforming Video

Slowing down video.

Now that I’m starting to shoot some video with the Nikon D3200, I wanted to try that old trick of shooting at 60fps and then changing the footage to 24fps for a bit of slow motion action. Now, you can’t just do this by slowing down the footage, you need to conform the footage. If you’ve got Final Cut Studio 7 you can use Cinema Tools to do it, and if you have Final Cut Pro X I guess it’s even easier, but let’s pretend you don’t have those, or you prefer open source… read on!

I couldn’t find a way to conform the footage using my old pal MPEG Streamclip, so I moved on to ffmpeg, and managed to find this bit on doing a conversion with a fixed number of frames.

Here’s what worked for me with two steps. There’s a way to do it all in one shot, but I’ve not got that to work yet. 

ffmpeg -i DSC_0031.mov 
  -f rawvideo 
  -b 50000000 
  -pix_fmt yuv420p 
  -vcodec rawvideo 
  -s 1280x720 
  -y DSC_0031.raw

So the first command above takes our original QuickTime file right from the camera (DSC_0031.mov) and creates a “raw” version of it we output as DSC_0031.raw (NOTE: In both examples the code should all be on one line. I’ve broken it up to multiple lines for readability. Make it one line!) 

ffmpeg -i DSC_0031.raw 
  -f rawvideo 
  -pix_fmt yuv420p 
  -sameq 
  -r 23.97 
  -s 1280x720  
  -y DSC_0031-24fps.mov

Once we have the DSC_0031.raw file complete, we run the second command and create a new file named DSC_0031-24fps.mov, which will now be at 24fps instead of the original 60fps. Note that we also specify the resolution (1280×720) and the frames per second (23.97). Obviously if you want other values, change those to something else.

So here’s the final video, shot at 60fps and played back at 24fps for just a little bit of slow motion. (With the RED ONE We can shoot at 120fps, but hey, a cheap DSLR doing 60fps isn’t too bad.)

One more thing on the video, it was shot with 3 camera angles, but only one camera. The trick here is to shoot the same sequence 3 times (yes, I drilled 3 boxes) with the camera in a different position each time. We do this all the time, sometimes you have to when it’s a one camera shoot, and sometimes it just works out based on the footage you’ve got.

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Kickstarting Your Ass

Kickstarter

I’m just dropping this post here to document my current thoughts on Kickstarter campaigns that are based on bringing a new product to market. For a bit of background, see this Google+ post as well as this one.

There’s nothing wrong with using Kickstarter to fund an idea for a product, but as more and more people do it, we may see people who have no experience bringing a product to market, and when we combine that with more and more people thinking of Kickstarter as a marketplace for products where you pre-order them, well… I see some problems.

I’m going to toss out a few examples, but I don’t want to come off as negative to any project, so with that said, here we go!

I’ve been following the Trigger Trap project and while I didn’t back it at the level to get a final product, I do watch the updates, including the most recent one. There’s some talk of a scam, and no legal recourse with foreign manufacturers, and tolerances and what not. There’s also a lot of not entirely happy people. On the side of the campaigners, they may have done a few things wrong, especially with the math, not just for the manufacturing of their cases, but with shipping calculations, how much they’d need to not lose money, and quality assurance. From the point of the backers, some are frustrated. They’ve been waiting for a final working product, and it’s almost there, but now there are more delays. Urgh.

Delays can be common even if you know what you’re doing. I backed the Sensu Brush and I saw delays, and I just shrugged it off because I know how a lot of these things work. Artist Hardware, the folks behind the campaign, describe themselves as “a design consultancy focused on creating consumer products for artists and crafters. We build it all from concept to shelf.” So they aren’t just some guys in a garage with an idea for a product, they’re professionals, and they still hit a bunch of problems! It happens. It happens every day in business, and with personal projects, and with Kickstarter campaigns. The key is planning for it.

Kickstarter campaigns can limit the number of backers at specific levels, right? so maybe more people should use that feature. Sure, you want to be successful, but that doesn’t always equate to having a giant pile of money, especially if you don’t know what you’re doing. (That’s not an insult, we all didn’t know what we were doing at some point, and there are still a ton of people who do not know how to bring a product to market.) Let’s say you limit the number of backers you need to just over what you think you might need for an initial run of a product. If things go pear-shaped, and you somehow make nothing (or even worse, lose money) you’re not out quite as much. And, you probably have less people pissed off at you.

But I think the problem is that everyone wants more money because people equate money with success. Of course Kickstarter and Amazon (the payment processor) want more money because that means more profits for them. If you’re the campaigner having more money may seem appealing: Volume discounts! More sales! And so on… but that may not be the case.

About a month about I wrote about beam systems, and one of them I mentioned was OpenBeam, by Terence Tam, who was kind enough to leave a comment on the post. Go listen to Episode 40 of Engineer vs. Designer right now, and then head over to blog.openbeamusa.com. This guy knows what he’s doing.

If you’ve read any of my Maker Business posts (here’s the more recent) you followed along with some of the things I learned in bringing a product to market. I’m glad I went self-funded and small scale, as it allows for learning and (not very costly) mistakes to happen. If you are doing a big project, don’t do it alone! Determine your weaknesses, and then find people you trust to supplement the skills you are lacking.

And Good Luck! I can’t wait to see your final product! :)