In April we appeared on Shark Tank for the second time in one year and we were proud to share our progress following our first appearance. Since then our growth in sales and user base has continued unabated and now we find ourselves in a position we knew could happen, but weren’t sure if it would. We anticipate that in two weeks, we will run out of Smart Vent inventory, and we have already sold out of Smart Bridges. We had always dreamed of this sort of reception when we first conceived of this product and are consistently floored by our growing Keen Home community. We built a solution to a real problem homeowners face every day, and our performance over the past year is a testament to that.
Hardware’s Magic Number
Early last year we had locked in a three-year 35,000 unit deal with Lowe’s Home Improvement that excited the Sharks and set us up for success early on. That’s a lot of units for a new company; about 11,000 Smart Vents per year. Most hardware companies – particularly connected devices companies – struggle to move even 10,000 units in their first year. Chris Quintero of Bolt, a Venture Capital firm focused on supporting hardware startups, wrote a fantastic blog post on this topic this February. In it, he explained that until a startup builds and sells 10,000 units, it is expensive to manufacture more and difficult to raise money. A startup can easily get stuck in a vicious cycle where they can’t raise money to boost marketing and sales operations, making it difficult to manufacture more units to meet current and future demand, which hurts sales and makes fundraising even more difficult.
Courtesy of the Bolt Blog
Our deal with Lowe’s helped get us over this hurdle, but on an annual basis it was still cutting it close. To ratchet up sales, we opened pre-orders on our website and on Amazon’s new LaunchPad initiative, selling Smart Bridges alongside individual and bundled Smart Vents to round out a homeowner’s system if they didn’t already have a compatible hub like SmartThings or Lowe’s Iris. Once we started shipping pre-orders, we activated other e-commerce channels such as Build.com and NewEgg.
The Meaning of Success
Six months after we started shipping, we have blown far past the 10,000 unit milestone. We are proud to say that as of today we have shipped nearly 30,000 units, just shy of the 35,000 units we expected to ship through Lowe’s over three years and nearly exhausting our first run inventory way ahead of schedule.
Exhausting our first production run means it’s time to fire up manufacturing again and start to assembling the next batch of Smart Vents and Smart Bridges. As soon as we sell through our remaining units we’ll give everyone the opportunity to pre-order the new run (with some exciting new announcements as well).
In addition to building new stock, we’re going to be spending this summer focused on launching the Smart Filter and Air Care products, releasing our wooden Arbor faceplate, and spinning up partnerships with HVAC pros/smart home installers across the U.S. and Canada. We may also be accepting investment from our community!
Next up: the Smart Filter
We couldn’t be happier with the success of the Smart Vent in such a short amount of time. Admittedly, it’s a bit scary to have sold out so quickly, but it’s certainly a good problem to have. Now it’s time to look to the future, and to get started on the next 30,000 units. As always, our sincerest thanks to all of you who have helped us get this far. Your support means the world to us.