A veteran hardware company in Shenzhen created a hit product that raised over $5 million in crowdfunding.

Author | Zhang Ziyi

Editor | Yuan Silai

Among the products with top crowdfunding results in Kickstarter Q1 this year, two laser welding machines emerged, with quite different performances.

The little - known and fledgling Xlaserlab launched a multi - functional laser welding machine, which ranked fourth with a crowdfunding result of over $5 million.

In September this year, Xlaserlab pre - heated its newly launched ultraviolet laser engraver E3 on Kickstarter. E3 claims to be able to engrave anything and is the lightest professional ultraviolet laser engraver on the market.

The consumer - grade laser engraver is still a niche market segment, but it can no longer be considered obscure. The annual revenue of leading companies has exceeded 2 billion, and there are also players who started with handheld laser engravers and have revenues of over 500 million.

There is no eternal winner in the hardware industry, and new players will continuously emerge in the market. Xlaserlab is one of them.

Before this product came out, hardly anyone had heard of Xlaserlab, but enterprise - level customers probably know the name of its parent company, "Xinghan Laser". In the industrial - grade laser field, Xinghan Laser has the world's highest shipment volume of semiconductor lasers. Three out of every ten laser devices in China have their core pump sources developed and manufactured by Xinghan.

However, in the consumer - grade hardware market, Xlaserlab is a complete novice.

Before 2022, Zhou Shaofeng, the chairman of Xinghan Laser, didn't know about the emerging forces in the laser engraving field, and cross - border e - commerce was even more confusing to him.

"People in the toB market felt out of touch with the world. In the very professional circle of lasers, everyone was competing on parameters and performance. It wasn't until after 2022 that I realized that people in the world were all making products, and what they were doing was so close to what we could do."

When Anker Innovations became a listed company with annual revenues of tens of billions, Zhou Shaofeng looked around Xinghan's customers. Companies with annual revenues of 3 billion only had annual profits of tens of millions. Both customers and Xinghan's profits were getting thinner. Zhou Shaofeng felt that the toB market had reached its limit, and it was necessary to find a new way out.

The idea came in an instant. The consumer - end market painted a great picture for Zhou Shaofeng, but it wasn't easy to find a successful methodology.

01 The Infinite Possibilities of Tool Products

On the overseas Reddit forum, someone posted a question two years ago: "Is a laser welding machine worth buying?"

Netizens in the comment section all thought that welding machines were versatile tools, but hardly anyone recommended a laser welding machine brand. One person replied, "I helped someone install a cheap Chinese laser welding machine for over $9,000. It looked pretty good... American machines cost between $30,000 and $90,000..."

In fact, laser welding machines are a common category in manufacturing factories. 60% of laser devices are used in the industrial field, and workers use high - energy - density laser beams as heat sources for welding.

Taking China as an example, according to the "China Laser Industry Development Report", in 2021, the global sales revenue of laser devices reached $21 billion, of which China's laser device sales revenue reached 82.1 billion yuan, a year - on - year increase of about 18.64%, accounting for about 60% of the global laser device market.

China has more mature technologies in laser cutting and laser marking. Laser welding is the main direction of technological iteration in the next stage of China's laser processing technology. Its non - standardization attribute is more obvious, and it also has higher requirements for processing accuracy and motion control.

The potential of the consumer - end market inspired Zhou Shaofeng. Xinghan Laser made a very quick decision to launch a consumer - grade laser welding machine. It only took four months from the official decision in October 2024 to the product's crowdfunding launch.

"We didn't conduct a very systematic survey on the laser welding machine category. At that time, we had some data on industrial welding machines. From the industrial applications of the top ten welding machines, we deduced that there would be potential opportunities in the consumer - grade market." Zhou Shaofeng told Hard Krypton.

Xinghan Laser found that almost every household in the overseas market has a welding machine. The welding machines are small and portable, and can be used by connecting to household electricity. Welding machines are widely used in overseas households. They can weld stainless - steel products at home, garden railings, broken doors and windows, or be used for self - vehicle repairs, such as painting cars and re - welding car doors.

The wide range of use scenarios of overseas welding machines also made Xinghan Laser realize the potential market for laser welding machines.

Therefore, the Xlaserlab X1/X1 Pro is designed to be quite compact and multi - functional.

Take the X1 Pro as an example. It is a portable high - power laser welding machine designed for novice users and small workshops. The machine weighs only 19 kilograms and supports household power. It integrates four functions: welding (including underwater welding), cutting, cleaning, and CNC modification. Its welding thickness ranges from 0.5 to 3 mm, and it supports multiple materials such as stainless steel, carbon steel, and aluminum alloy. The welding speed is five times faster than TIG welding, and it is priced between $3999 and $4299 (including a wire feeder).

Currently, over 2000 units of the Xlaserlab X1/X1 Pro have been delivered, with a delivery rate of 90%.

When Xinghan Laser first designed products for the consumer - grade market, having enough functions and simple operation became important concepts for the X1/X1 Pro. "ToB customers have a certain operating foundation and can adjust according to their own needs. ToC customers are different. The product has to be ready - to - use when they get it." Zhou Shaofeng said.

02 Product Accumulation but No Market Experience

For an upstream enterprise in the laser field, transitioning from the B - end to the C - end is not easy. Both Xinghan Laser and Zhou Shaofeng have received several rounds of market education.

Before 2022, Xinghan Laser focused on the R & D and production of semiconductor lasers, which are the core components of laser device products. They can be used in downstream fields such as automobile manufacturing, power generation equipment, 3C electronics, and aerospace.

Zhou Shaofeng recalled that in 2021, the factory was always in a rush to complete orders, and the company couldn't fulfill all the orders.

After 2022, the price war in the laser market was fierce. Zhou Shaofeng clearly felt that although the company's revenue was constantly increasing, the profit situation didn't change much. Xinghan Laser once tried to enter the lidar market. In response to the demand for vehicle - grade 1550nm lidar light sources, it specially launched a high - reliability 940nm semiconductor laser with a failure rate of less than 100fit. This laser, based on the mature EDFA technology, became one of the more mature lidar solutions.

In the past three years, Xinghan Laser has been struggling in the transition field. Between the enterprise - level and consumer - level markets, Xinghan Laser chose to focus on the enterprise - level market first. ToB is an area that Xinghan is good at. They wanted to meet the needs of B - end customers before entering the C - end market.

The idea was good, but the reality was cruel.

"We used to think that if we became the world's number one in the ToB market, we could make a living and grow big. Later, we ignored a problem. After the competition became saturated, many ToB orders were related to the ecosystem." Zhou Shaofeng recalled.

For example, BYD - affiliated battery companies won't use batteries from CATL, and CATL - affiliated battery companies won't sell their products to BYD. "I thought our customers would bring in 3 billion in revenue, but in fact, we could only choose half of them. The market is not big enough, and the competition is so fierce that it can't meet our development needs." Zhou Shaofeng said.

Zhou Shaofeng came to a new understanding: ToB has no pricing power and no brand, but the ToC market does. The consumer - grade market can create differentiated value. "Technology is our strength." In Zhou Shaofeng's view, transitioning from a ToB laser device provider to the ToC market is a "dimensionality reduction strike" for Xinghan.

Although the technological accumulation gives Xinghan enough confidence to develop new products, it can't be ignored that in the consumer - grade market, product development is the first step, and sales and operation are the second and third steps.

Due to the lack of overseas e - commerce operation experience, Xlaserlab X1/X1 Pro didn't build an independent website during the Kickstarter crowdfunding, missing out on the first wave of product traffic.

"We didn't know we needed to build an independent website and enter Amazon at that time. We lost nearly tens of millions in this wave of traffic." Zhou Shaofeng said.

For Xinghan Laser and Zhou Shaofeng, the door to the consumer - grade market has just opened to them. They need to adapt to the fast - paced, extremely flexible C - end market and face the equally cruel competition as in the ToB market.