Lemnos: A Silicon Valley Incubator for Hardware
Many people would look at the assembly line in a McDonald’s kitchen and see ultra-efficiency. Not Helen Zelman. She thinks robots could knock out tastier burgers faster, and for less money. “Right now you’re limited by what a 16- or 18-year-old fry cook can do,” Zelman says. “Robots can perform more complex tasks. You could think about making Five Guys burgers at McDonald’s prices or even higher-quality burgers at Five Guys prices.” To make that magic possible, Zelman’s hardware incubator, Lemnos Labs, is funding Momentum Machines, which is developing a burger-making robot named Patty that can assemble a cooked burger and bag it in less than 30 seconds.
Lemnos Labs was founded by Zelman and Jeremy Conrad, both 28, last November in San Francisco, and has raised $1.85 million from angel investors including former Yahoo! executive Ash Patel and WordPress creator Matt Mullenweg. Lemnos is backing about 10 hardware startups, including a maker of autopilot systems for unmanned drones and a company that built a device that attaches to corporate campus vehicles and connects with a smartphone to coordinate employee pickups.
Lemnos follows the typical incubator model, handing out a relatively small amount of money to help promising companies get going. What sets it apart from other incubators is that rather than back the creators of new websites and mobile apps, it exclusively nurtures hardware companies. The price for sophisticated electronics has dropped dramatically in recent years, as has the price for design software and machines that allow entrepreneurs to create quick prototypes. The Internet has also made it much easier for small companies to gain access to contract manufacturers in China and elsewhere.
“All of these forces are allowing amazing innovation to occur in the hardware area,” says Eric Klein, a vice president of advanced engineering at Nokia who is assisting with projects at Lemnos. “The barriers to entry for this type of thing are just so much lower now than five or 10 years ago.” Some of these trends are an offshoot of the so-called Maker Movement, with thousands of people turning into hardware and electronics hobbyists in recent years. Lemnos shows there is some serious financial potential behind the movement.
Zelman and Conrad invest $50,000 to $100,000 in startups for up to a 10 percent stake. The founders have recruited a network of advisers—experts in design, marketing, and manufacturing—that the young companies can turn to for help. “If you’re an engineer at Boeing, don’t send us your hobby project,” Zelman says. “Tell us what inefficiencies you see in the production lines and how you would shake them up.”
The hardware companies bring their prototypes to life in Lemnos’s warehouse, a grungy facility in south San Francisco with tattered couches, workbenches, and a kitchen stocked with giant jars of pickles. Lemnos supplies a communal stash of tools and equipment. More serious gear is available a few blocks away at TechShop, a do-it-yourself club where members pay monthly dues for access to huge lathes, 3D printers, commercial painting apparatus, and other equipment.
Zelman and Conrad became friends while studying mechanical engineering at Massachusetts Institute of Technology. After college both took jobs that involved identifying talent. Zelman went to work for the Arizona Diamondbacks, working on software for analyzing players. Conrad headed to the U.S. Air Force, where he developed sensors and lasers for 747s to detect missiles and shoot them down. He also evaluated technology pitches from small companies trying to sell to the government. The pair had dreamed since college of starting a business together in Silicon Valley. Once Conrad finished his military service, they headed to San Francisco and found investors who bought into their pitch about the potential for a hardware revival.
Hundreds of budding entrepreneurs have presented Zelman and Conrad with ideas ranging from sex toys to satellites. The startup furthest along is Local Motion, the maker of the corporate shuttle device and software, which Google now uses in its company cars. Blossom Coffee, another Lemnos company, plans to start selling an $11,000 coffee machine early next year. When the bar code on a bag of beans is scanned, the machine activates precise brewing temperature and duration settings to make the perfect cup. The device, which looks like a high-end French press with a luxurious wood finish, will be aimed at people in charge of testing beans for coffee chains. As for Momentum Machines, they’re still perfecting their prototype—a contraption standing about five feet tall that cooks burgers and toasts buns on a conveyor belt, then slides them into compartments so that an automatic slicer can cut fresh vegetables and layer them on the burgers. Another conveyor belt passes the burger into a bag.
While the Lemnos Labs concept looks novel in an age focused more on bits than atoms, it actually harks back to Silicon Valley’s early days. In the 1920s, Philo Farnsworth developed the television in a lab just a couple of miles from the Lemnos warehouse, and decades ago electronics workshops across the Valley did pioneering work in radio, radar, and vacuum tube technology. Conrad wants to revive the spirit that gave rise to such hardware giants as Hewlett-Packard. “Right now, if you’re a mechanical engineer and you’re smart, then you learn to code, because that’s where the action has been,” he says. “We want to give those people an opportunity to stay in the field they love and cause some disruption.”