Startups are subject to something like infant mortality: before they're established, one thing going wrong can kill the company. Hardware companies seem to be subject to infant mortality their whole lives.

I think the reason is that the evolution of the product is so discontinuous. The company has to keep shipping, and customers to keep buying, new products. Which in practice is like relaunching the company each time.

I don't know if there is an answer to this, but if there were a way for hardware companies to evolve more the way software companies do, they'd be a lot more resilient.