I'm more of a firmware guy, myself, although I've done some PCB design and a fair bit of hardware debugging. My startup experience has been in the oil industry at companies with fewer than 5 people.
I don't have actual data backing me up. It seems low to me because I have gotten the following impressions, some of which may be wrong:
* San Francisco is one of the most expensive cities in the world.
* Startups in Silicon Valley routinely receive tens of millions of dollars in funding despite having questionable business plans, conflicts of interest, and mentally-unstable founders.
* Even SWEs who just graduated from college can get upwards of $150k/year at major tech companies, even if they spend most of their time just copying and pasting from Stack Overflow.
* Good electronics engineers are rarer than good SWEs. Good electronics engineers who can also design high-precision machines are extremely rare, and the ones with semiconductor experience are probably earning big salaries at large companies.
* Hardware development is much more expensive than software development. In particular, hardware design errors can be much more expensive to fix.
* Getting a new manufacturing process up and running is a lengthy and capital-intensive task. Creating a totally new kind of manufacturing process to "disrupt" an established, competitive industry could charitably be described as "high-risk".
* Hardware startups rarely make it big, and the ones that do seem to be associated with trendy software stuff like crypto, AI, and quantum computing.
To summarize, a startup that's going to be spending a lot of money on hardware development in a very expensive city wants an experienced engineer with a specific and unusually-large skillset, and they're offering a salary that barely competes with an entry-level SWE job along with some high-risk stock options.
As another comment said, it sounds like they want someone who will treat this as more of a hobby than a job. Which is fine, but I feel like the proper job title for that is "independently-wealthy cofounder", not "hardware engineer". (Alternately, I've heard that highly-specific job offers can be used as an excuse to get an H-1B visa -- maybe they're looking to hire someone from Taiwan. Or maybe I'm just being cynical.)