How NextCorps and GIS are helping cleantech startups scale up to mass production faster

On the surface, technology hardware startups and manufacturers are two completely different beasts.

The no-sleep, no-overhead, I-want-to-make-what-doesn’t-yet-exist mindset of an entrepreneurial inventor is a far cry from how a typical manufacturing facility is run; a factory relies on highly engineered, repeatable processes. Where risk feeds the startup, it threatens costly disruptions for the manufacturer. One pivots and improvises, the other repeats what works.

For the most part, the paths of venture hardware startups and manufacturers rarely cross. But, when they do, it’s at a critical juncture in the innovation process: when it’s time to scale up to mass production. Most startups have little or no manufacturing experience. That means they don’t always have a clear understanding of the logistics, engineering, and economics it takes to get their product to the end of an assembly line.

“There are huge differences between commercializing as a large company and as a startup founder,” Ron Wexler has observed, an entrepreneur who formerly worked in research and development at Kodak.

Wexler launched WexEnergy LLC in 2014 as a startup venture to introduce WindowSkins®, an affordable but effective energy-efficiency system that can be mounted onto existing windows in a home or building.

“Hardware startup founders need a more comprehensive understanding of manufacturing requirements and the ability to find complementary expertise and resources when needed,” said Wexler.

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WexEnergy graduated from two cleantech-entrepreneur programs led by NextCorps, a nonprofit based in Rochester, New York, and funded by state and federal agencies. NextCorps manages a range of services to support entrepreneurs and manufacturers that aim to foster economic growth and competitiveness across the Rochester and Finger Lake regions.

Opening the black box

Tech hardware startups rarely have internal manufacturing capabilities, so they turn to contract manufacturers for help.

“Among first-time hardware entrepreneurs the use of a contract manufacturer is basically a black box—they don’t know what’s happening in there but they should,” Michael Riedlinger said, who is the manager director of technology commercialization and Scale For ClimateTech at NextCorps.“A lot of startups don’t know how to ‘talk manufacturing,’” Riedlinger explained. “They may know inside and out how to build a perfectly functional prototype by hand in their workshop, but they’re in the dark when it comes to translating that into a repeatable, engineered industrial process.”

This is where manufacturing readiness levels (MRLs) come in, an assessment framework with over 200 criteria originally developed by the U.S. Department of Defense. In 2018, NextCorps began working with the Golisano Institute for Sustainability (GIS) at Rochester Institute of Technology (RIT) to use MRLs to assess how prepared (or unprepared) startups in its different programs were for working with a contract manufacturer.

Even though contract manufacturers are the most feasible option for tech startups ready to begin production, most lack a basic understanding of how they work. Startups usually have only a faint grasp of the manufacturing process as a whole; often they don’t know how to engineer a repeatable manufacturing process, how to allocate the right resources (such as skillsets and machinery), or how to address the basic design questions manufacturers need answered. These may seem inconsequential next to all the cliffs and landmines hidden throughout the innovation landscape (only 1 in 12 startups succeed on average, after all). But what most startups don’t know about manufacturing has far-reaching effects that can significantly delay—and even keep—new hardware from getting to market.

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“WexEnergy came into the program already engaged with a contract manufacturer,” Wex explained. “The program helped us strengthen that relationship because we have learned how to better communicate with our manufacturer.”

Contract manufacturers expect a product design to be translated into documentation that they can then use to build out a production line. Documents like a bill of materials (BOM) and bill of process (BOP) are templates that put a prototype into language that a manufacturer understands. These documents inform design for manufacturing (DFM), which is how a contract manufacturer sets out a plan to meet their customers’ expectations in terms of quality, performance, and budget.

Building manufacturing readiness across the U.S.

In 2020, Nextcorps and GIS, its technical partner, responded to a federal solicitation from the National Institute for Standards and Technology (NIST). The funding opportunity was for projects that would solve new or emerging manufacturing problems not already addressed by the national network of organizations that, along with NextCorps, make up NIST’s Manufacturing Partnership Extension (MEP) program.

Riedlinger believed the success of the NextCorps manufacturing-readiness program could be generalized into a toolkit that any MEP could use to connect the dots between startups and contract manufacturers in their regions. He worked with Brian Hilton, a senior researcher engineer specializing in sustainable design at GIS, to write a proposal—it was successful. Nextcorps and GIS were awarded a grant worth $999,000 to develop the toolkit.

The project’s first phase, now complete, was focused on the creation of basic assessment and educational materials. This work drew directly from the U.S. Department of Defense’s MRL framework to inform the program’s overall curriculum. Developed by NextCorps and GIS staff, the set of materials includes an online assessment and road-mapping tool, a “teach-the-teachers” guide, instructional resources, and templates for essential documentation (like the BOM, BOP, and DFM mentioned above).

With the basic materials for the toolkit created, NextCorps recruited startups participating in its programs in the Finger Lakes to trial them. Six selected participants are currently undergoing a prototype review with Hilton at GIS ahead of the formalized manufacturing-readiness assessment. Successful candidates will be eligible for funding to support their transition to mass production.

For the project’s third and final phase, the trial with Finger Lakes startups will be improved upon for a second, trial in southwestern Pennsylvania. NextCorps, GIS, and FuzeHub (another MEP in New York State) will partner with Catalyst Connection, the MEP center for southwestern Pennsylvania, and Innovation Works, a tech-startup incubator and seed-stage investor based in Pittsburgh.

Learnings from the southwestern Pennsylvania trial will ultimately shape the final version of the program toolkit. Once complete, the toolkit will be distributed across the MEP National Network for any MEP center to use.

Innovation for decarbonization

Hilton believes that bridging the gap between sustainable hardware technology entrepreneurs and contract manufacturers is critical to wider decarbonization efforts in the U.S. He is part of Scale For ClimateTech’s operating team and has already provided his expertise to more than 50 startups on their journey from prototype to mass production since the program launched in 2018.

“To decrease our footprint, we need to shorten the time between when a new, clean technology is first conceived and when it can be mass-produced so people can actually use it. That’s why manufacturing readiness is so crucial right now,” Hilton said.