Building a Hard Tech Startup at HAX with Sloane Tilley
Background
Sloane Tilley is the Founder & CEO of DIA. Sloane joined HAX, the SOSV hard-tech accelerator program, in January 2023. I talked with Sloane about HAX’s due diligence process, the resources and equipment they have at their facilities, and what advice she would give to someone applying to the program.
Highlights
- The HAX due diligence period is longer than other accelerators. Sloane mentioned her due diligence period with HAX was 4-6 months, so plan when you engage and monitor your runway accordingly.
- HAX negotiates its investment as part of the program on a company-by-company basis. They will not lead your next round but will follow on.
- The HAX team of engineers, scientists, supply chain experts, and business advisors works alongside you to help you source production-grade parts, validate the science and technology, and ultimately build and distribute your technology. The Newark facility includes 3D printers, a PCB prototyping facility, lathes, and more. They’re in the process of building a wet lab.
Interview Transcription
Kieran: Thanks, Sloane, for joining me today. To start us off, do you want to introduce yourself?
Sloane: Yeah, thanks so much for having me Kieran. My name is Sloane Tilley. I’m the CEO and Co-Founder of DIA. We’re a HAX portfolio company. We make sensors that can monitor chemicals and liquids in real-time.
Kieran: You joined HAX in the New Jersey location in 2022. Is that correct?
Sloane: So, we officially signed the paperwork in January 2023. We moved the whole team to Newark and have been working out of there. They have a large prototyping facility in downtown Newark.
Kieran: Why did you apply to HAX? What stood out about that program?
Sloane: We’ve been trying to get the company off the ground in earnest for about 18 months. At that time, raising money was not easy, especially not for a hardware company. The distinguishing feature of HAX is it is precisely for hard tech. We did a due diligence period with them for 4-6 months. Building the relationship took a long time, but we felt it was where we could make the technology we were trying to invent.
Kieran: Were you considering other accelerator programs?
Sloane: We had considered a few others. To be transparent, we had been rejected by a few others, as most startups are. We felt HAX was the best fit. Whenever rubber met the road, we decided that was the one that we wanted to pursue with all of our ammunition.
Kieran: Were the other accelerators (industry-agnostic), or were you looking at other hardware-specific accelerators?
Sloane: There was one other hard tech accelerator, but the rest were pretty general. We haven’t just done HAX. We’ve done a few others. We were part of Berkeley Skydeck, part of their unfunded portion. We’ve done Lighthouse Labs. So, we’ve done a few other general accelerators, which are still very helpful. The specific thing about HAX that is so useful is that it’s a longer-term program. They recognize it takes a little bit longer to take a hardware product. So, having some of that awareness and having fellow hardware founders around you has been helpful.
Kieran: Can you give an overview of the HAX admission process? You mentioned it was 4-6 months.
Sloane: That was them vetting us for that long. They have a pretty impressive team, and they act less like an accelerator and more like a venture capital firm. They expect to remain on your cap table throughout the company’s growth and put a lot of resources into each company they invest in. It’s more of a rigorous process to vet the technology and team. HAX is just one of the SOSV accelerators. There is also IndieBio, which is based in New York City and is more Life Sciences focused, and then a climate tech one in San Francisco. Those are all under the SOSV investment firm. HAX is the hardware one. We got put in contact with someone from the climate tech one, who then referred us to HAX. From there, we just kept conversing with people and did several pitches. But also, it was a pretty informal process.
Kieran: Can you talk about some of the questions they asked? What were they focused on for your company?
Sloane: Yeah, so they have a very robust engineering and scientific team. They vet the science and the hardware behind your innovation. That looked like really explaining the patents we filed so far, why that was defensible technology, and where we plan to go with our patent strategy. Also, we discussed how the HAX engineering team could help us advance the technology more quickly.
Kieran: You mentioned that HAX is a long-term program. So does that mean you are still in the program, or have you graduated and moved on?
Sloane: No, we’re still in the program and based out of the HAX offices. We fully anticipate a long-term relationship, which is pretty special about how SOSV invests in companies.
Kieran: How are you using the program? Who are you working with? What resources are you taking advantage of?
Sloane: So, Leo Chen is the Program Director at HAX. He manages several teams, but we meet with him on either a weekly or bi-weekly basis. We were initially three co-founders; we’ve since added a fourth employee, and we’re hiring two more right now. That’s all on the R&D side. So, Leo helps me a bit on the business side and project management. They are also helping us build one of our device’s circuit boards now. My engineer works very closely with a HAX-employed engineer. Then, we also have sort of a regular cadence check-ins with Duncan, the Managing Director of HAX. He cultivates relationships with different investment firms, helps us shape the overall strategy and vision, and helps us think about the next round of funding, such as how we refine our pitch and our strategy of which investment firms are most advantageous for us to go after.
Kieran: That’s one of the things that I noticed when I was looking at HAX. They have their team, and they work alongside you. You mentioned their engineer helping your team member. How do they allocate resources?
Sloane: They make the entire team available to you. They have people in Newark. They also have engineers in India. They have supply chain individuals who can help you source different parts. The other key resource is in that office in Newark; they have 3D printers, lathes, soldering, and a PCB prototyping facility. They are also building a wet lab with high-performance equipment like chromatography and fume hoods. Dr. Susan Schofer is leading that effort. They actually have a Chief Scientific Officer. She holds a Ph.D. and has done lab science for a long time. So, they make sure that their teams are well supported from a scientific and engineering perspective. Regarding how they allocate resources, you have to speak up and effectively communicate your needs. They’ve always made time for the teams that they support.
Kieran: What does the endpoint of the program look like?
Sloane: There have been HAX companies that joined in 2018 that are still in the Newark offices. They won’t lead your next round, but they will follow on. I think the informal agreement is that once you get too big for the space, you need to move out.
Kieran: You mentioned they won’t lead your next round but will follow on. Do they still do Demo Days? Or how do they support companies with fundraising?
Sloane: They haven’t done Demo Days in Newark so far. I think there are plans in the work. The Newark location is still pretty new, and they’re building it out. Initially, teams went over to their Shenzhen location in China. Since they are bringing everything back to Newark, I think there are plans to do a Demo Day and build up the Newark ecosystem more. But that would be a better question for the program team.
Kieran: HAX invests $250,000 into companies accepted into the program. It’s broken down into $150K in cash and $100K in in-kind support, which covers their team, facilities, and equipment. What are the terms of the investment?
Sloane: They are negotiated company-by-company because companies enter the program at different stages. But, they typically do it via a SAFE with a valuation cap. So, pretty standard in terms of what Y Combinator or Berkeley Skydeck would also do for a very early seed investment.
Kieran: You mentioned they have some other programs – IndieBio and Orbit Startups. Is there any overlap between the programs regarding resources or how you collaborate with founders in those programs? Or are they separate?
Sloane: Particularly between HAX and IndieBio – since we’re a 20-minute train ride away – there is a fair amount of collaboration. IndieBio hosts many investor events in their space, so the HAX founders are always invited to their Demo Days and brought in. Even the Managing Director of IndieBio has been willing to sit down with me and take a call because we have some Life Science applications. It has been pretty collaborative regarding meeting people, interactions, and introductions. We don’t usually work in each other’s spaces because both programs are growing, and IndieBio operates in a cohort schedule, so they have a tighter timeline than HAX. They are really in and out in six months. So, I understand they need to have dedicated spaces for all of their teams.
Kieran: One value prop for all these accelerators is advice. What’s been the most valuable piece of advice you’ve received?
Sloane: There has been a lot of valuable advice. We’ve grown a lot in our time at HAX. For me, personally is just the confidence that the HAX team put in me and my team as executives to say, “No, you’ve done the hard work on vetting the technology now. You must believe in your leadership skills and grow into your roles.” Then, they gave us specific training around that and said it’s worth putting time into that. It’s not just all about the tech.
Kieran: I love that. There’s a lot of validation that you can get from getting into one of these accelerator programs. It’s a vote of confidence.
Kieran: What advice would you give to someone applying to HAX to stand out?
Sloane: Make your technology stand out and make it clear why you need hard tech support. That is such a unique area right now, only a few companies are being founded in that area because it is hard. The number of times we’ve been told that hard tech is hard, we wouldn’t have to fundraise anymore. So, emphasize to the HAX team why you feel passionate about going into hard tech because they feel very passionate about that. So, that’s what makes it a good match.
Kieran: What advice would you give to a founder accepted into HAX to make the most out of the program?
Sloane: Try to come to the Newark facility because it is impressive and they are only adding more resources. Also, lean on fellow founders. They’ve had many very impressive founders come through the program, so really leveraging that network of individuals who have just built incredibly successful companies and knowing that just being in the HAX portfolio will often be enough to get you a conversation.
Kieran: How many startups are working out of the Newark office?
Sloane: It’s growing. I think that they’ve accelerated the pace of teams they can support because they have been building out the space. Right now, there are between 10-12 on any given day, but I think more are coming in.
Kieran: Is there anything I didn’t ask about that is important to know if you’re considering HAX?
Sloane: I don’t think so. I obviously probably see it through rosie colored glasses because they believed in my company when nobody else did. But, I will say, they’ve been really great partners.
