The Cost of Hardware Prototyping

First things first: prototyping costs. They always get underestimated. When you start a new product development you have to put aside a healthy budget for prototyping.

Depending on complexity, prototyping costs can start at relatively modest levels but can quickly scale into the six figures, and in some cases, surpass seven figures.

Prototyping cost cannot be estimated by the size of your product. It’s the complexity, components, and processes, not the size that determine prototype cost.

You also need to factor in the man-hours spent on assembling, debugging, and refining each prototype. Functional prototypes with custom PCBAs and other custom made parts carry a higher cost.

Each prototype answers different questions. In hardware you need multiple iterations: 

• Looks-like models: To validate industrial design, aesthetics, and ergonomics.

• Proof of Concept (PoC): To prove the core technology is feasible.

• Functional Prototypes: "Works-like" models used for internal testing and user feedback.



• Engineering Builds (EVT/DVT): Factory-grade iterations to validate reliability, signal integrity, and product compliance.

Looks-like Model

A looks-like model is basically a prototype that shows off how the final product will look, without worrying about whether it works yet.

Industrial designers use these to play with shape, color, materials, and how the product feels in your hand, making sure it looks great and fits the brand. 

They’re also super useful for getting feedback or showing investors what’s being worked on.

Proof of Concept (POC)

The first and roughest stage of any prototype is called a proof-of-concept. When creating them, engineers use developer boards or breadboards. These prototypes often don't look aesthetically pleasing which unsettles many non-technical founders 🙂

POCs are important because they enable you to rapidly and affordably test a hypothesis before spending money on thorough design work or custom PCBAs. 

If you catch issues early, you can save a lot of time and money if the basic function fails here.

Functional Prototype

A functional prototype is all about making the product actually work. These builds use custom PCBAs running firmware, often paired with CNC-machined housing parts, so they’re as close as possible to the final product in both looks and function. 

The goal is to prove that the electronics, software, and mechanics all play nicely together. At this stage, you can test performance, reliability, and how the product works in a real life situation.

You will encounter setbacks at this stage. The firmware might not behave as intended or a mechanical feature might have an issue. Sometimes parts have to be re-worked.

Each prototype builds upon the lessons learned from the previous prototype, leading to a more polished final product. So don't panic if something doesn't work right away 🙂