3D printing startups often struggle. Despite growing demands and optimistic predictions, the pandemic negatively affected the industry: the material shortage, logistical problems, lockdowns and factory shutdowns form the conditions that are far from perfect. But new interesting ideas still emerge and it seems that the pandemic is far from being the main problem for startups.
Technically, each of those businesses goes through similar stages: from searching for ideas and like-minded people to attracting investors and scaling up. But this article will not cover the product release but will rather be focused about the things that a startup would face out of its ‘garage’.
Where the Industry Currently Stands
Since this article will look at the startups through the lens of the world of 3D printing, it would be rational to take a look at the industry as a whole.
Bad news first. The demand for 3D printing is definitely on the rise but the pandemic definitely put some breaks on the growth and the consequences are only now becoming obvious. There are chips, materials, spare parts and wire shortages. The logistics became more complicated due to closed borders and the factories that stopped working. As a result, providing services became even more complicated.
It’s worth mentioning that the industry played a role in helping the medics during the beginning of the pandemic: printing the valves for ventilators, face masks, safe door knobs for the clinics, etc.
But non-perfect conditions don’t mean that the startups should focus on the temporary things such as this pandemic. The technologies should be versatile and have a wide range of use-cases, especially since what sets additive manufacturing apart is the ability to quickly refocus the production for nearly any requirements.
Breakthroughs among the startups are now more rare than five-seven years ago. Many new ideas are just the re-iterations of the existing ones instead of something innovative. But today there are more 3D printer manufacturers, many of them have their own advantages and disadvantages and they cover different price ranges. There are many alternatives and 3D printing is now more accessible than ever.
Speaking of interesting solutions, the Ai Build showed the robotic arms with the extruders. Technically, it’s still the FDM technology but now there’s a bigger build volume and the ability to make even more complex prints thanks to higher mobility (as an example, you could imagine extruder integration into the uFactory xArm with a reach of 700 mm; that’s a huge build volume for such a low price). It’s not something complex and unique per se but it’s a very impressive approach to the existing tech.
The industry also needs serious 3D printing time reduction but currently there’s only one company with significant results. It’s Carbon with its CLIP technology that makes printing 100 times faster possible for SLA 3D printers. If it’s going to be reproducible, the startup will become very successful.
The market is also in need of unique materials, improved equipment and radically new directions. And all of the things are interlinked, one of them can’t evolve further than a certain point without the developments in other things. But many modern solutions aiming to improve the existing tech will not ever become available at the market. And there are various reasons for that. Let’s talk about what can be done to boost the chances of a startup becoming successful.
How the Startups Grow
The most pressing potential issue for any startup is obvious and mundane: the lack of experience and/or money. There are ideas, plans, theoretical knowledge and the projects but an entrepreneur can’t sell them since they don’t have required skills or don't know who would be the potential buyer. So the first step is to learn how to present the project.
Unfortunately, inventing and manufacturing are not the only things required for starting a business. Ideally, there are at least two people needed for a startup to function: someone with technical knowledge and someone with marketing skills. The latter can be replaced with someone rich as well. Any experience and knowledge would be better with either inveesting or marketing skills that would help to attract other investors. So, different specialists are not exactly required but they significantly increase the chances of the startup becoming successful. The more skilled people there are, the more chances to be financed. Selling an idea can be done alone, but the experienced marketing person has more chances of succeeding.
But if the startup only consists of a sole developer, it does not mean that the project will not have any future. The investor themselves can become a partner if they know enough about the field (in this case it would be 3D printing). They can act as a person who would put the product to the market and sell the idea to the end user., as well as being in charge of human resources.
It’s worth remembering before another presentation that an entrepreneur will only have one meeting with an investor, so the better the show, the more chances there are for the second meeting. Usually, after the first meeting the investors know if they are interested in the project or it would be a waste of time.
Here’s an example: an investor meets a startup expert. The latter present their project with a scientific approach to things. For example, it could be the manufacturing technology for a 3D printing material made of aluminum that can be degraded with zero waste using certain substances. If the investor isn’t familiar with the industry, they likely will not see the details and the potential of the project and will not give money.
This is where a partner with marketing experience could help. Correct presentation and explaining how the idea will pay off will play a huge role. The person doesn’t even need to be an expert in 3D printing, just a few days of understanding the advantages of the project and getting ready for the presentation would be enough.
Finding such a person is a different task. Networking can help, as well as job-seeking websites or thematic events: conferensions, pitch sessions and others. For example, that’s how the HARZ Labs startup was born: .
One need to understand all of the important details of their project:
The problem it solves;
The field of application;
How long it would take to develop;
What kind of team would be needed
The idea should be thought through and it doesn’t matter whether the project targets a personal usage or industrial field. The ideas that sound like ‘I think of making a printer that works with dough’ aren’t good enough. Just an idea doesn’t cost much. It requires at least certain things to have a chance. Explaining how much it would cost, when it can be mass-produced, what it could do, as well as plans to design certain print heads will go a long way. Now that sounds like a startup.
Financial calculations are also needed. It can be done approximately even if the tech is very unique. This is where financial skills or a separate expert would be helpful..
A clear understanding of a targeted segment is required. This means market research and comparison between the product and its direct competitions, including pros and cons and main specifications. Detailed calculations aren’t needed at an early stage, but a clear comparison is a must.
It’s also important that the product would be marginable and scalable. For example, when Markforged planned to supply their equipment into the market of post-Soviet countries, many clients would be the closed-door enterprises. Markforged uses cloud-based solutions, so the defense industry on this market would not use their products. That is a certain limit to scalability.
There is only one chance to make the first expression. Below is the list of the things needed for a resulatitve meeting.
The project’s overview. What the project is and if it would be in demand. The chances and prospects of further improvements or being ready to use. The more details, the better.
Required investments. Approximate calculations of how much money is needed.
Lead time. It’s important to know how much time is required to bring the product to the market. It would be even better to have a certain road map with approximate time required for each stage of development (prototyping, testing, etc.) .
Partnership conditions. This list includes legal things. (shares, who owns what, the rights) and other requests aimed at the investor. It’s important to remember what the startup needs.
The detailed overview doesn’t mean a large list of things with tables and schemes. A short but informative presentation consisting of 10 Powerpoint slides would be more than enough.
Ideally, the startup should be able to sell its ideas even to the investors that are not familiar with the industry. On the other hand, there are aggregators and investors specialized in 3D printing and additive manufacturing. .
But selling an abstract idea without explanations covering its advantages and how useful it would be to the industry is rather difficult. The ready products are in higher demand, even if they are at the prototyping stage. The ideal product for the investors would have its manufacturing ready, as well as a business idea and clear understanding of future plans.
Starting a Partnership and Investments
The legal side of things is always covered when dealing with startups.
But there are many variables: it depends on the project, its stage and the size of investment. The partnership can mean 50/50 share of owning rights in regards to the technology, or there will be royalties without the ownership rights. Sometimes the technology can be fully bought. The options are nearly limitless.
After everything is said and done, the rest is to work on the project. If there is a need for new full-time workers or additional equipment,
The startup is not a straight road from point A to point B. There are many small things about the process and some of them are completely unexpected. They are fixed and solved as they come, sometimes the plans need to be changed. For many entrepreneurs it’s their first foray into the world of 3D technologies and additive manufacturing. It will allow them to get useful skills and understanding of the segment, as well as improve their networking.
A successful project is a simple thing to explain: it gets its product to the market, sells, rents and provides services. It makes money and the investments are paid off. It’s not a startup anymore but a fully-fledged company.
Sometimes the project fails. In this case, nobody asks for their money back, since the risks were clear. And it’s not a reason to dissolve the team or stop partnership. If everyone is on the same page and there are new ideas, there is a reason to start something new and learn from their mistakes.
Some time ago, a laser office printer used to cost thousands of dollars and now it’s accessible to anyone. The same will happen to 3D printing. It will be available to the masses and will become an everyday part of life for many people. But the technology is not there yet: it still costs significant money and requires certain skills. One day, it will change but the startups will always be needed. Especially, if their ideas can be game changers or improve the quality of many lives.