Kickstarter is Debt — Bolt Blog — Medium.

Hardware startups struggle to manage their cash. It’s common to pay for large expenses (like tooling and inventory) 9–12 months prior to selling your product. This is why pre-order campaigns have been transformational to the hardware ecosystem: they can solve the cash flow crunch of the first production run.

But while crowdfunding is a powerful tool, it’s also one of the most misunderstood. There are a host of lesser-known financing options available to help with cash flow. This post aims to expose these options and help young hardware startups navigate the world of debt financing.

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Every financing option has its place in the timeline of a company. Using crowdfunding as a replacement for equity financing is just as dangerous as raising a high-interest round of venture debt too early in the company’s life. Debt can be especially dangerous if not used carefully: unlike equity it’s very hard to develop a plan B if things go wrong. When in doubt, ask an experienced investor that has dealt with all of these options, ideally someone who knows hardware financials.

Read more. Gotta say this, Bolt has one the best and most consistent series of posts about making hardware, “Venture Capital Designed for Hardware” is what they’re selling, the advertising are these article, good work bolt.io.