With $650K In Seed Funding, YC-Backed Upverter Chases The Dream Of A Hardware Startup Revolution

Toronto’s Upverter is a startup that’s poised to effect change that could reshape the landscape of entrepreneurship. That’s not something you can say about most of the businesses we cover on a daily basis, whether or not they have good ideas. But it’s definitely true of Upverter, the company that’s hoping to build a cloud-based hardware engineering platform that can match and overtake its desktop-based counterparts within the next few years.

So what would that mean for the messy, expensive business of hardware prototyping and product creation? Nothing less than the beginning of a new era, according to Upverter CEO and co-founder Zak Homuth.

“The three of us that founded the company all kind of come from a mixed hardware/software background, we all studied electrical engineering, we all worked co-op jobs at startups all around the world, did a little bit of hardware and a little bit of software,” he explained in an interview. “And then we got together to try to improve the rate of innovation with hardware. We all ran away from it, because it was easier to build software than to build hardware, and we wanted to fix that, because we wanted to build hardware personally.”

The idea was to make tools that would allow Homuth and his co-founders to build a hardware company as their next startup venture, so they quit their jobs, sold their possessions to get some working capital and moved to Homuth’s parents basements, with the nascent idea of building an engineering platform that lives entirely in the cloud. For the fledgling startup, the question was whether or not they could build a GitHub for hardware, how cloud-based it could be, and whether that was something anyone even wanted. Flash forward four months.

“Then we got into Y Combinator, picked the company up, moved it down to Mountain View and got this shitty little townhouse across from YC,” he said. “By that time we’d figured out that the solution to the version control problem, the innovation problem, the crowdsourcing problem was to move it all to the cloud, and specifically the tools. Because if you move the tools to the cloud you make it possible to control the file format, so that you can do version control, you can control consumption, you can control the viewer.”

Upverter launched a very simple version to a very controlled group before coming out of YC, and then took that MVP-style product into something that could be used by the general public in September of 2011. “It couldn’t really do much,” Homuth admits. “But it was the line in the sand that allowed us to say ‘Does anybody wanted to do engineering this way, instead of the way you’ve been doing it for 30 years?’ and we got enough ‘yesses’ that we kept working on it.”

The company has since been tracking down money, building out its tools to a point where they actually compete with existing design tools, via a release just a few short months ago. Upverter has raised $650,000 so far from angel investors, including YouTube founding team member Christina Brodbeck, and Xobni co-founder Adam Smith, and that has managed to allow them to build a software tool that begins to be able to compete with existing tools. But there’s still a long way to go, Homuth says.

“It’s not at parity by any means, it can’t do everything that $100,000 software can do yet, but you can do non-zero stuff,” he said. “You can actually get stuff manufactured, you can actually simulate, you can actually manage a product’s life cycle, you can actually design. And that was step one in our three step plan to change engineering.”

Step two is to get the platform to parity with existing tools

Step two is to get the platform to that parity point, where it can compete with existing tools on an equal footing with legacy software. Getting to a point where they can design equally well in a browser as with a desktop tool is around six months away, according to Homuth, at which point Upverter will be able to start building out its sales and marketing team. Once it gets there, Upverter will have built in a little over three years what legacy CAD companies have taken 30 years to create. The next goal, beyond that, is to become the “Rosetta Stone of engineering,” meaning that no matter how you come at engineering, no matter what tools you’re using, it’ll translate and you can work with anyone else in the world on the same files and on the same projects.

Upverter’s ultimate goal is still at least a couple of years away, Homuth says, and the time it takes to get there will be dependent on what kind of money the startup can raise. He’s actively looking for fresh investment now, while also continuing to add to the 10,000-strong user base it has managed to attract so far.

The rise of Upverter means a potential explosion on the horizon for hardware startups, which is why the company is hosting a hardware hackathon with Y Combinator on February 23rd. Making hardware engineering collaborative, affordable and easy to access can have a tremendous impact on the cost of doing business and risks associated with creating new hardware, which is why Upverter achieving its goals could lead to a new revolution for hardware startups, incubators and investors alike.

If you happen to be one of those hardware startups, Upverter is offering free team accounts to TC readers. Just follow this link to sign up.