Why preorders and why now

I’m opening preorders for the 2.4 GHz version of the system. In doing so, I want to explain why they are the only way forward and give some background on what is needed for those numbers to work out.

First off, fpv.blue has been loosing money since its inception. I used funding from another profitable endeavour of mine, a website, in order to bootstrap it. Over the years this other business slowly decayed and I’m not in a position where I can throw money at solving a problem I have at heart anymore, .blue needs to become profitable or be closed down.

Fortunately, I finally consider the technical aspect of the problem solved, with everything else being the only remaining minority issue. This is ironic, as most hardware startups fail being unable to manage cashflow or capital, not because they can’t solve the technical problem. The technical aspect is supposed to be “simple”. This one really wasn’t, it’s a miracle I got this far. Which leads me to the first answer:

Why now? Because it’s working

I never wanted to commit to releasing a product, even less so taking in customer’s money, before knowing for certain the thing to be actually real. You can think something up in your mind, prototype it, verify every theoretical aspect of it and lab-test it all you want, but there is no replacement for actually going out in the real world and praying. I can finally say this works, and it works well, and it’s insane but my theoretical understanding of the problem was actually matching reality well enough to materialise in a nice product. So it’s done, and working, and I will publish videos showing it. And I can finally open preorders.

Why preorders? Because this is a terrible business

Hardware manufacturing is a walking nightmare. Let’s put aside all of the issues that go into the manufacturing part. Let’s assume a perfect world where you pay some money to get some result and there are no unexpected problems, no delays, nothing out of specs and no one screwing you over. Let’s just talk about the money part of the problem.

Manufacturing requires upfront cash. That is one hell of a big problem, but here are another two compounding it:

  • You need big volumes, otherwise the price will be too high and people won’t be interested. To solve it, you need a lot of upfront cash.
  • Due to how online payment systems work you can’t use that money for manufacturing as in most cases it is only available after shipping. In solving this, no amount of (customer) upfront cash will help you.

Now some numbers. For the sake of argument, let’s assume:

  • 100k as real fixed costs so far, like development boards and tools
  • 30k salary per year times the last year of development, let’s ignore the time before it and how I could make more walking into any job
  • 20k as additional running costs per year

So, as a gentle assumption, let’s say that if .blue is to break even within a year it has to make profits of 200k. (costs so far + costs for the next year).

At a 20% margin and 450 per unit, that is more than 2k units. There is no market for that. Let’s scale back, let’s say the fixed costs so far are something I should forget about and let’s consider the cost during last year and the next year, 100k. That’s 1k units in one year, 3 per day. A big nope still.

Let’s keep scaling back then. Let’s only consider the running cost from today onwards. 50k per year. Let’s assume I can keep doing everything myself without going insane. That’s still 500 units, that is a very, very, very positive proposition and it is unlikely to happen still.

So this is where I’m at.

I need a price low enough to be interesting. Volumes high enough I get better deals on manufacturing and hopefully get a slightly better margin than 20%. And a way to handle a frozen paypal/credit card account, that is going to cut on the margin for sure.

There aren’t many ways to come out ahead in this situation and the only one I see is good reception for this batch of preorders. Because of the volumes problem, I can’t rest my hope in a future batch. This isn’t to say “You need to preorder today without even a video of the system working”. This is to explain, as clearly as I can and even if at the bottom of a long blog post just a few will read, there is a very good possibility this product doesn’t materialise merely because the numbers aren’t good enough to make anything work.

So, if you want this product to succeed, please preorder as soon as you see a video online of the system working to your satisfaction. I will make sure to deliver that.

48 thoughts on “Why preorders and why now”

  1. I can’t wait to see the video, I want this to work soooo much! It’s what has been holding FPV back, the image quality. Post that vid! I’ll buy!

  2. Margins should always be hovering near 30-40%, and ideally 50% or more to ensure long term success. You need to figure out a way to lower costs because 20% won’t get you far long term. Skip the fancy packaging, skip higher end components, and focus on marketing. This product isn’t for the military; it’s for hobbyists who couldn’t care less about the hardware components as long as the product does what it’s supposed to. Dragonlink uses crap components yet they get the job done. You need two minds to at least get the business part sound. I kept telling you this, you wouldn’t listen. Closing down the RCGroups thread was the stupidest move you could do. Half the interest and excitement faded away because you did that.

      1. Are you Max_FPV from the RCGroups thread who proposed adding 1080p video with HD sound to this product AND wanted long range?

        It’s easy to label someone a troll just because I start asking valid questions to point reality out from under the sheets while all you do is make silly statements about wishful thinking.

        After all, this is a business and history shows wishful thinking won’t get a business far.

    1. Margins will depend heavily on the batch size. This is a wee bit more complicated than a FSK transceiver. The RCGroups thread had no use existing for the last few months, as there was nothing to talk about. It’s open again now. Thank you for your inputs.

      1. I’m not sure we can really discuss batch sizes in a market like this. The overall FPV market is pretty small relative to other technology markets. Realize that at least half of the participants are totally fine with their analog systems; these are most hobbyists. A quarter are hobbyists who are interested in an HD video system; these are your customers. The remaining quarter are professionals who are in the Pixhawk world; they will probably stick with their in-house HD video system once all the bugs and issues get sorted out. So your market is a quarter of an already small market. Given this, do you foresee so much demand that you will have to organize your supply in multiple batches with increasing volumes from one batch to the next AND feel comfortable offsetting climatic profit to a point in the future? My guess is that you will end up producing two batches before you’ve largely exhausted your target market.

        1. Right now the only goal is, if the batch makes economic sense, manufacture it. Give up otherwise. This is why the emphasis on those preorders. I agree on this being a small market, I disagree on this not being ideal for professionals, as their “in-house” HD solutions are far from perfect and the product is modular enough it fits several markets perfectly.

          1. I guarantee you that you will not find the answer to your question doing pre-orders. You’ve lost a lot of interest and excitement over the past few months. Even fewer people than before will be willing to spend money on a pre-order this time around than last time. This is reality.

            My advice: first bring onboard a business mind (respectfully, you have a genius technical mind but your business mind is definitely lacking), build a business plan. Since the HD video system works already, halt any further development work on it. Consider expanding your product portfolio. You need to BUILD a business now (something you should have done before you even started any development work). I suspect you can figure out who I am from RCGroups, if so, send me a message there if you’re interested in chatting. If not, good luck.

          2. The batch DOES make economic sense if the product does what it’s advertising, but the way you present it it doesn’t. You’re telling everyone that you won’t make it and there probably won’t be a 2nd batch… who wants to invest in a system they won’t be able to expand later? Someone might buy 4 sets over a couple of years, but they’ll end up buying 0 because of lack of confidence. That would be the only reason for not making the numbers. You need external funding so you can make a large batch and ensure the product lives beyond the initial shipment. Make 10K units now and sell them over a couple of years with sufficient margin instead of _trying_ to make a couple of hundred units every 6 months with people not being able to buy units inbetween when they need them. You’re only going to reach critical mass if people are confident, but they won’t be if you’re always struggling. You need a product that’s (fully, not “a board shrink away”) ready and demonstrated before taking people’s money, marketing that shows it in all its glory in the “modern” way people expect nowadays (yeah it sucks but it’s necessary), and investment large enough (not of your own money) to make the numbers work. And you need someone to look for investors for you with a positive attitude, because if you pitch things to an investor the same way you did in this post of course none is going to support you.

          3. This is very much wrong. I mean you give a bunch of information I have already clear here and offer no real solution, but what’s wrong is that if this batch makes it past the assembly oven there won’t be a second one. Wrong, very much wrong. If I have to spend the effort left to take this to market you can be sure it’s gonna stay in it.

  3. Hi Davide,

    Could you post some pics and final specs (dimensions and so on) to see how are the inputs ports and that stuff?

  4. Are you making sure to protect your intellectual property after all of this hard work via trademark/copyright/patent as appropriate? It would be crushing to see you invest so much in this only to have a Chinese knock-off succeed in the market while you go under!

  5. Have you considered Kickstarter / Indiegogo? Seems like their whole purpose is to solve exactly this problem. I would strongly encourage you to leverage one of those platforms rather than trying to manage everything yourself.

    In any case, I’ve been following you for over a year and can’t wait to get my hands on one of these. Thank you and please keep doing what you’re doing!

    1. I also think this is a good idea as you can market it to the Security market for use as secure RF link cameras and that is a huge market.
      Industrial monitoring ?
      Dedicated web cams linked to internet from further distances with telemetry of interest to application (weather, rainfall, temperatures, snow or water depth etc)
      I myself am interested to also use it for investigation work and evidence capture. And FPV of course and hopefully one day HD 3D FPV.

      You could even do both with your dedicated followers here pre ordering and Indigogo / Kickstarter opening other market segments you are not imagening now.

  6. Hi,
    Keep up the great work!
    Regarding legal operation @ 2.4 GHz @ 100 mW in Europe: Did you check ETSI 300 328?
    In the past few yrs some severe challenges came up, like media utilization etc. One cannot simply occupy the spectrum without permitting others. But then I don’t know about your modulation, and this might not even apply to you…
    All the best.

    1. Yes, of course, I read that document several times over. I don’t see any unexpected problems there, but it goes without saying that the FCC mode will have better performances.

  7. Would a “DIY kit” version be a option with us doing assembly ourselves to lower cost ?

    If you think components will be too small and difficult to surface mount perhaps a larger pc board version for the kit ?

    I would love the opportunity to assemble a kit version at lower cost.

    What % can be saved by removing assembling in factory ?

    Regards and thanks for bringing FPV into the modern age.

    1. Not much. Automated assembly at scale is cheap, on the other hand having another PCB with bigger components is expensive. The board is full of BGAs and 0201, I personally have troubles hand assembly prototypes and bringing them online myself, I wouldn’t want a customer to do it. This is much more complicated that that youtube channel selling flight controllers for rockets 🙂 (I envy that business, TSP space or something?)

  8. It’s good news about solving the tech problems! I wonder what cost-cutting solutions you considered. For example, it doesn’t need to be a slick product to begin with. So, injection molding and such can be skipped, because, probably, most potential customers have access to 3D printing or can make an enclosure some other way. PCB and electronics can’t be that expensive, I presume. The final assembly could be done by customers as long as it doesn’t require precise soldering and such. In other words, would selling it as a form of DIY kit could cut down the costs?

  9. I’ve waited so long for your pre-orders.
    It’s a good thing that you’ve switched to 2.4Ghz for users with legal issues but as far as I’m concerned, people with interest in your systems will aim for longer range than other competitors.
    That being said, why not make readily-made 1.3Ghz version as well? It will reduce technical effort/price and it was a product of interest a year or so ago. Maybe the small batches will make the price go up but it wouldn’t hurt to just give it a go wouldn’t it?

    1. Once you see the 2.4 GHz range you will change your mind. Make sure to write me if you didn’t as I would love to hear from you. No, there is no future 1.3 GHz version planned. Need to consolidate options and scale up manufacturing!

      1. You’re showing a lot of confidence! I’ll look forward for your videos, specs and capability to come.
        I’m thirsty for your product’s information!

  10. Hi Davide ,

    I have a few questions about pre-ordering.

    Is price on the preorder page in USD ?
    Do I need the HDMI input module to connect the camera to the TX or can the camera connect directly the to TX ?
    Will there be a refund if the product does not ship?

    1. The things you can buy are priced in USD, if you are in the EU the price is converted to EUR and VAT is added on top of it, unless you have a valid VAT-ID.

      The only options where the product doesn’t ship are:

      – I don’t collect enough preorders to make it worth it (the most likely outcome at the moment)
      – Something catastrophic happens during production. Several times, as I would be covering my errors out of my pocket and I can cover a few errors. I end up with piles of unsellable junk and at some point have to give up. There would be plenty of updates before we get there and I have absolutely no intention of going down that way, as I will only make this product once I’m 100% certain it’s ready for manufacturing.

      So in the first case, absolutely, you will get a refund (I can’t talk about credit card fees or conversion costs), in the second case I’m going bankrupt, that I really don’t plan on.

      In other words, yes, you will get a refund.

      The camera can connect directly to the transmitter without the HDMI module, that is a standalone HDMI input.

  11. Also, I wonder if you could make your product more broadly appealing by making a version for non-flying folks. Like farmers, who, probably, would be interested in observing some parts of their domain in real time without a need to extend wires there (powered by solar cells). Security people would get a freedom to change locations of their security cameras once in a while, etc.

  12. Or, even for other type of flying folks? My son is learning to fly a real airplane. I bet his instructor would love to be virtually there on the first solo flight.

    1. I would love to, but I don’t own one.

      This is half the price, has the same capabilities (Video, RC and Mavlink) and some extras (HDMI out, custom camera in, flexible video input cables, low latency video), however you need to use your own monitor/RC radio (what good is 1080p on a 5 inch monitor anyway?). Sensitivity, I would need to test it because I have problems with what they claim (-99 dBm at 20 MHz), as that’s pretty much the same as the thermal noise floor. .blue decreases RF bandwidth to increase sensitivity, that is well below -100 dBm in “failsafe” mode (< 4 MHz). I can't find a number for their transmission power, but .blue goes up to 28 dBm.

  13. Can you detail what frequencies you will support? I ask because the latest stuff from Furious that does 2.4 completely mimic’d the out of date TBS channel choices which limits me to all of 2 channels here in the US, both of which will get stomped by a 2.4 Radio link and/or wifi.

    If the frequencies available will include all of the US legal frequencies, it would be a great help! They are: 2305 MHz, 2396 MHz, 2410 MHz, & 2430 MHz. I mostly fly 2305 analog.

    1. 2400-2484 is the 2.4 GHz ISM band, so any frequency in there is used by the system. There is a chance 2490 MHz ends up being supported thanks to places like Japan where it’s legal to use.

  14. Looks like an interesting project! HD FPV has been lurking for a while but was always too expensive and not fast enough. Now fpv.blue is priced correctly for the masses I think, and performance looks good on paper. I don’t have the financial resources at the moment to get in on it, but I just wanted to share a potential strategy if the pre-order doesn’t go well. Look for a buyer / partner company! Peeps like TBS, ImmersionRC, FuriousFPV, … might be interested to be the first ones to offer an affordable HD FPV solution. They could buy the technology from you and push it to market, or any other form of collaboration that we can imagine. You probably already thought of that, but I would hope that at least 1 of those bigger companies could be interested. Good luck!

  15. If I place an order now, will I receive my .blue system one of the first? At best it will be August?

  16. Davide,

    silently following you for a year or so.

    Just one question: I considered preordering (from a German account) but I see “Irish VAT 23%”. Are you currently located in Ireland ? I thought you were in Italy. As far as I am concerned there are no additional taxes for shipping inner EU I think. Would you please make that clear for me ?

    with best regards and keep up the good work


    1. I’m only in Italy for testing, I live and work in Ireland. As an Irish company, I need to charge VAT to European customers. This is a cost I don’t have for customers outside of the EU. You can get an exemption by inserting your VAT number during checkout.

  17. I highly recommend you take a look at and talk to the folks @ crowdsupply.com based out of Portland, OR in the US. It exists for projects exactly like this, and would be a huge help to you. Lots and lots of projects have been successful by using them, that otherwise would not have been. Much better than Kickstarter and the like. Cheers.

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