This is correct. The materials are dirt cheap - less than $1 per panel. The expense comes from the software in the controller and app development (from my experience with the latter, much more money went to the former /s).

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You can find cheap stuff on aliexpress/baba. Or, you can make your own. Find something opaque that you want to light up and you can easily put your own LEDs in. You can get a 5 meter strip of RGB LEDs with a controller and a remote for under $50 $20 (damn, these are cheap now!). These can be cut to a smaller size with nothing but a scissor cut if your project can be done with one uninterrupted strip of lights. Here is an example (just did a quick search - not endorsing this - but they are all from the same factories in China) https://www.amazon.com/Waterproof-Controller-Holiday-Decoration-Kicthen/dp/B01C75BU6S/ref=sr_1_4?s=home-garden&ie=UTF8&qid=1545021359&sr=1-4&keywords=rgb+led+strip+remote&refinements=p_n_feature_keywords_four_browse-bin%3A7802632011 If you don't want a strip the are other configurations, pixels: https://www.amazon.com/WESIRI-Diffused-Digital-Addressable-Controller/dp/B075TBGGXV/ref=sr_1_4?s=home-garden&ie=UTF8&qid=1545022198&sr=1-4&keywords=rgb+led+pixels+with+controller+remote or modules: https://www.amazon.com/SuperLightingLED-Module-Waterproof-String-Controller/dp/B075JB13TN/ref=sr_1_19?s=home-garden&ie=UTF8&qid=1545022198&sr=1-19&keywords=rgb+led+pixels+with+controller+remote or rings: https://www.amazon.com/Multi-color-Headlight-Housing-compatible-12V-24V/dp/B01MZ0D25A/ref=sr_1_fkmr3_1?s=industrial&ie=UTF8&qid=1545022364&sr=8-1-fkmr3&keywords=rgb+led+matrix+rings+with+controller

If you can solder** (or want to learn) the strip lights can be cut into numerous small pieces and placed inside any object you want to light up. You won't get anywhere near the functionality of nanoleaf, but you will be able to choose colors and simple blinking patterns. This would get you to the point of something that looks like nanoleaf, but no intricate patterns - just a sequential color change or single color. (**You could probably do some things without soldering because they now sell pre-made connectors that do the soldering for you - but they aren't very sturdy.)

If you wanted to go deeper, you can buy the same rgb leds that are addressable - which means you can program your own patterns or copy others (this is what is inside the nanoleaf). If you go addressable, you need to buy your own power supply and controller and then do your own coding (or copy other peoples' code from forums). If you are familiar with Arduino, it is a very popular controller and there is a strong community of users to learn from. A good place to start is adafruit.com . They sell leds, but they also have a bunch of DIY instructions and info.