Category Archives: 3D printing

What the Stratasys patent suit of Afinia means for the 3D Printing Industry

27 November 2013

Q: What is Stratasys thankful for this Thanksgiving?

A: Patents and a large corporate legal department. 

That may be a little harsh, but after the press release and filed suit against Afinia made public this week you can see that Stratasys is going to start flexing their IP muscles in this increasingly competitive market. Given that Stratasys is asking for an injunction to stop all sales of the Afinia H Series, this is a lot more than a shot across the bow. Stratasys is aggressively staking their claim to the 3D printing market.

Why Now?

The Afinia has been on the market since August 2012 and has done quite well during that time. They’ve won multiple awards from Make Magazine including “Best overall experience” and have been a mainstay at virtually every Maker Faire around the country. They also have signed distribution deals to start selling their printers at BestBuy.com and Staples Canada‘s online sites. They’re an increasingly strong competitor that is flexing their retail muscles thanks to their parent company’s experience in retail.

Q3 numbers for Makerbot was not as strong as some would expect in a growing market like consumer 3D Printers. Selling likely less than 5,000 printers had to raise some flags internally, which has led to a number of actions by Makerbot to try to grow their bottom line:

  1. A new partnership with Donor’s Choose to sell more Makerbots to schools.
  2. A change to the website to make Makercare opt-out (a $300+ cost) to try to increase LTV per customer.
  3. Opening of stores in New York City, Boston and Greenwich, Connecticut.
  4. This lawsuit against a major competitor.

Big partnerships and storefront bets are the kinds of big plays you can make to throw your weight around when you’re the biggest company in an industry. Lawsuits leveraging your patent portfolio also happen to be a powerful weapon, which when you aren’t capturing as much of the market as you like, become more appealing to use against stiff competition.

Given Stratasys has been a sleeping giant for a number of years, it appears they’re making it very clear they are awake and are ready for a fight.

The Stratasys Attitude

This quote from the press release really stood out to me:

“IP infringement discourages companies from investing in innovation”     – Stratasys CEO David Ries.

This claim is absurd. If anything, having additional competition that you can’t shut down due to patents means you have to innovate faster; in an open market, new innovations are more prevalent as companies have to push hard to stay ahead. Brand loyalty, customer service and marketing become more important as well.

Everyone is at Risk

There’s an awesome discussion of the infringement, the patent claims and possible work arounds on the RepRap form worth checking out. From the forum, these are the patents mentioned:

  • August 5, 1997, U.S. Patent No 5,653,925 (the 925 patent) METHOD FOR CONTROLLED POROSITY THREE DIMENSIONAL MODELING
  • February 2, 1999, U.S. Patent No. 5,866,058 (the 058 patent) METHOD FOR RAPID PROTOTYPING OF SOLID MODELS
  • December 21, 1999, U.S. Patent No. 6,004,124 (the 124 patent) THIN WALL TUBE LIQUIFIER
  • January 8, 2013, U.S. Patent No. 8,349,239 (the 239 patent) SEAM CONCEALMENT FOR THREE DIMENSIONAL MODELS

Most of these patents could apply to any consumer FDM 3D printing company selling a fully assembled printer and do not expire for at least 4-6 years. Stratasys went after the biggest threat that just so happened to be getting competitive distribution deals. If Afinia loses the lawsuit, it puts every other startup 3D printing company at risk of a similar suit.

The Big Picture

This is just the beginning. As CNBC has reported, over 6,800 3D printing related patents have been filed in the last decade and the rate of filing is increasing. It’s clear that Stratasys intends to enforce their patents aggressively as the CEO states:

“The entry barrier for infringers is modest, especially as technology improves and prices fall… As a result, we should anticipate that this will be a growing challenge for right holders and law enforcement.”                     – Stratasys CEO David Ries.

While Stratasys and 3D Systems aggressively try to capture a consumer market that doesn’t yet know why they need to get a 3D printer, I expect other low cost printers to start to capture value at the low end of the industrial market. Whether by helping make molds for sand casting or just being a low cost alternative to the more expensive printers, textbook disruption is happening. This disruption will take decades and given our current trajectory, will include quite the blood bath for both big and small companies on their balance sheets and in the court room. Yesterday’s patent suit announcement is a key point in history and another of the many likely battles in the court room between challengers and incumbents in the 3D printing market.

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The Rise of the 3rd Party Manufacturer in 3D Printing

26 November 2013

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There’s a lot to be learned about the present and future of 3D Printing by studying the rise of the Personal Computer. Today we have hundreds of companies building supply chains from scratch to sell 3D Printers out of garages, co-working spaces and tech shops, not unlike Steve Jobs’s garage and the motel in Albuquerque that spawned Microsoft. However, this part of the journey did not last forever.

As the market and individual companies matured, 3rd parties began supplying various components to the PC makers as they built more sophisticated manufacturing processes. The PC makers welcomed this so that each one of them did not have to reinvent the wheel for each component as well as get better prices from suppliers who could gain volume advantages by selling to many of those PC makers.

Today, we’re seeing the very beginning of such opportunities emerging with a handful of really interesting companies becoming the first 3rd Party Manufacturers (also known as OEMs). Here’s a few I’ve been tracking:

The Rise of the OEM

Extruders:

1) DGlass3D: You may remember these brothers from previous blog posts and the 2nd edition of my newsletter, when they were on Kickstarter. While they did not fund successfully, they were able to connect with companies interested in their technology. Given the challenges of dual extrusion caused by the decreased build area, added weight for the stepper motors and quality of prints when switching back and forth between heated materials in each extruder, I expect more than a few companies may be interested in the technology to shortcut adding this pivotal feature.

Why this matters: Many use cases open up when you add the second extruder including printing your support structures in a water soluble material, multi-colored printing and printing in multiple materials with complimentary properties (like part hard, part soft or part conductive, part insulated).

2) The Prusa Nozzle: Josef Prusa is one of the most prolific contributors to the RepRap movement, which includes the Prusa Mendel, one of the most popular RepRap printers. Recently, he unveiled the Prusa Nozzle, which allows you to print at up to 300 C and is a much easier to use, single piece. See more about the Prusa nozzle in edition #4 of my newsletter.

Why this matters: Printing at temperatures as high as 300 C allows additional materials to be printed like polycarbonite (bullet-proof glass) and food-safe stainless steel materials are better than the past use of brass.

Materials:

1) Proto Pasta: Another new Kickstarter entrant, these guys are working on reliable, high quality filament for your FDM printers. On their Kickstarter, you’ll find a carbon fiber reinforced PLA, high-temperature PLA and an experimental polycarbonate material. They’re testing and certifying their materials, which is rare in the current materials market.

Why this matters: Stronger, more reliable materials allows users to print for more applications. Combine this with dual extrusion (ie- multiple materials in one print) and it really gets exciting.

2) MadeSolid: This Oakland-based materials manufacturer recently completed a successful Indiegogo campaign which expands the color options for FormLabs printers from gray and yellow to the full rainbow. They’re working to make quality resins and filaments to make higher quality prints. They have some very cool technology in their pipeline I’ve seen some parts (hint: the days of PLA and ABS may be numbered).

Why this matters: Component makers have not fared as well as many 3D Printer companies on crowdfunding campaigns. It’s good validation that people are hungry for new, better materials that MadeSolid hit their goal. It also means that they do not need the distribution channel of any printer manufacturer to be successful, which provides huge negotiating leverage should they talk distribution with one.

Build Plates:

1) BuildTak: If you spend much time printing, you quickly run into issues with your printed material sticking well to your build plate and also being easy to remove after the print finishes without damaging the print. BuildTak works with both ABS and PLA and is more durable than kapton tape, which has a habit of tearing as you remove objects. This company is just starting out but is already being evaluated by some 3D printing companies.

Why this matters: Reliability is one of the most important aspects still needing dramatic improvement in the 3D Printing space especially for novice users. If this works as promised, it could address one of the major causes of failed prints: poor adhesion to the print surface.

2) Automated Build Plates: Unfortunately, this technology doesn’t exist…yet. Makerbot tried and failed in the past to create this system for automatically removing parts. For those looking to print items in a queue, they currently have to manually remove every object upon completion. That’s why Hack a day put a call out for work on such a project recently.

Why this matters: The development of a process for removing prints would be very valuable for any organization sharing a printer with multiple users and wanting to leave prints unattended and still have multiple items printed. Of course, the printers need to be used enough for that to be a key pain, which is only an issue for a small percentage of users right now.

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Even a company with a large engineering team and an unlimited budget would struggle to keep all this innovation in house. It is only a question of when, not if, 3D Printer manufacturing companies at the low end of the industry move from an integrated solution to a more modular approach*.  This opens up many opportunities for individual OEMs to emerge to produce key components that supply many of those companies. (* Note: Patent-heavy, unique processes will keep the industrial printers closed for the foreseeable future).

What other great OEMs have you seen emerging? Leave a note in the comments.

[Ed Note: A version of this post originally appeared in my bi-monthly Observations in 3D Newsletter. Sign up now to get more in depth analysis like this at http://bit.ly/Observe3D]

Why Consumer 3D Printing Companies Should Think Twice About Fundraising

16 October 2013

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As I’ve spoken to many in the Consumer 3D Printing industry, I’ve heard an increasing amount of talk about raising money from professional investors. While an angel round could bring stability and some financial certainty, raising institutional money is very big risk in such an early market. Venture Capital can bring validation, a comfortable bank account and open a few doors thanks to partner networks, but at this point, I believe the risks far outweigh the gains for Consumer 3D Printing. Here’s why:

Why consumer 3D Printing companies should not raise Venture Capital now

1) We haven’t crossed the chasm yet.

If we had crossed the chasm, people wouldn’t still be asking why you would ever want a 3D Printer. Zeepro would have already well exceeded their Kickstarter funding given how nice looking and feature-rich their printer is (instead, they have sold 300 printers and barely exceeded their funding goal). We would also have a robust set of applications to leverage 3D printers, which excluding design tools (the 3D Printing era’s BASIC imho), is fledgling or non-existent today.

Spreadsheets and word processing programs were largely responsible for early majority users buying computers in the early 1980s. Specifically, VisiCalc has been credited with catapulting sales of the Apple II when it came out in 1979 (2 years after the first edition of the computer). Of course, those programs weren’t even possible until early computers advanced their hardware in key areas like memory, hard drive space, and displays as well as overall product reliability.

Today, we have many hardware improvements still needed for 3D printers to enable new use cases. Breakthroughs in multi-extrusion, print speed, materials and huge improvements to the kluge software experience are all needed to create a “Whole Product” as described in the classic, Crossing the Chasm. Until then, sales will continue to be measured in the hundreds or thousands, which does not align with the mass market growth investors crave.

2) Fundraising is an accelerant for your business.

If you raise venture funding, you may be able to relax a bit from the stress of bootstrapping (i.e.- making payroll), but it comes at a high cost. Venture Capitalists invest with the expectation of the funds being spent aggressively and creating significant growth. If you haven’t had explosive growth, the next set of dollars will be even more expensive, if they’ll fund you at all.

Once you hire people ahead of revenue, it’s hard to stop and even more painful to do layoffs. But don’t take my word for it. Ben Horowitz put it best last week:

“We should first decide how much we like laying people off, because if we love it then lets stay cash flow negative, because when we don’t generate cash, the capital markets decide when we have to lay people off. In fact, we will have to listen very carefully to investors on everything because as soon as they stop liking us, we will start dying. I don’t know about you, but I do not want to live my life that way. I do not want to have to tell all of our employees that we will do what we think is right until investors tell us we have to do otherwise. I want to control my destiny.”

If you absolutely need to raise money, sticking to Angel investment is the only way to go; prudent angels will understand the need for financial stability without aggressively outspending your revenue. You could sell them on plans to turtle up and survive the chasm crossing while placing a few intelligent bets.

Larger investors will neither understand this strategy nor support it as they have funds to return over a time frame that may be shorter than the path to massive growth for your business. You should expect a volatile, painful 2 to 3 year chasm crossing period before we really hit the early majority years. If you raise capital during this time, you will require multiple, highly-dilutive rounds of capital before you can really return value as investors usually expect a round of funding to last just 12-18 months when deployed properly.

3) VCs don’t just talk to you because they want to give you money.

So you’re getting repeat meetings with a VC. They seem friendly and interested in the data you’re sharing and the plans for your business. While it’s true it could be that they’re serious about investing, it’s also quite common for meetings to be free research for them on up and coming industries (Note: I’ve specifically heard from some 3D printing companies they “wasted a lot of time” doing this). Walking in their shoes, a few pitches from different 3D Printing companies would give a great view of the market to gauge when they may be ready to invest years down the road.  

Of course, most VCs are also great at the “soft no”; they’re happy to continue to have you or one of your cofounders make more pitches and exchange more information without actually committing to funding or outright saying no to you. And as a worst case scenario, they can use your information to fund a competitor or steal your idea. I’m not advocating for you to completely ignore VCs, but choose wisely who you invest time in speaking with. Ask yourself if you could better spend that time growing your business.

4) The early PC industry succeeded without it.

In the early days of the PC industry, Venture Capital was just emerging and largely was not involved in funding companies. Microsoft only raised $1 Million in its history and at a time when it really did not need it. While Apple did raise money, the majority of the funds came in the 1980s, long after the market was established and Apple was selling millions of computers. The rapid growth of the market as it hit the mainstream allowed profits to easily fund additional growth and made many founders and their employees very rich thanks to their non-diluted stock options.

Early markets require new marketing channels and use cases. By Clayton Christensen’s definition in the Innovator’s Dilemma, truly disruptive innovations have to find their own way beyond what the existing industry does with a technology.  As PCs were before, consumer 3D Printers are just that kind of disruption, which means there is going to be a lot of experimentation and exploring to find the best opportunities and develop new ones. There are very few venture investors that have the patience and interest in letting companies do this kind of exploring, since their capital and experience is better leveraged for scaling.

5) Your best investors are your customers.

No one said it would be easy. To really meet where the market is going (because honestly, we don’t know), finding the first few people who will pay for something you’re doing is huge. They’ll help you build the product others will need, find others like them and keep your business afloat financially in the meantime. There’s a reason these businesses started in garages, motel rooms in Albuquerque, and the like; they couldn’t afford anything else.

To survive the chasm means finding a beachhead and expanding. The focus and controlled desperation of bootstrapping can be a powerful tool to develop such a market. If you’re sitting comfortably with venture capital, the hunger to find this will be less and you may even find yourself building a bunch of features that no real customer wants until it’s too late.

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We’re in an exciting, but challenging time in the 3D Printing industry. There are many more players currently than there will be winners, which is the tragic, harsh truth of entrepreneurship. Raising money may seem like the obvious way to get a leg up, but it could also be a major waste of time or drive you and your business right off a cliff.

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What the Kickstarter Hangover will do to the 3D Printing Industry

8 October 2013

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Kickstarter has been transformative for many companies, and for the last year or so, the 3D Printing industry has in particular been benefiting greatly from it with over 80 projects and a healthy 50% fund rate (even higher in the last 6 months). Unfortunately, like having too much of a good thing to drink one night, we’re headed for a painful hangover in the 3D Printing industry thanks to Kickstarter.

We’ve seen the data before. Only 25% of KickStarter projects deliver on time, and for wildly successful funding projects it’s even lower at about 16%. This means a lot of waiting and a lot of disappointment for those that may never receive the project at all. There’s no reason to believe 3D printing would be immune to the issues other projects have faced.

So what are the consequences of these delays?

Impatience:  Many users are going to get their printers 6 months to a year after they ordered it. This slows the adoption rate of the industry as people tie up funds they’d invest in a 3D printer they could use immediately. It’s unlikely people are going to buy another printer while they’re eagerly hoping for their Kickstarter one to arrive. With no printer, users won’t be able to start experimenting with the technology.

Obsolescence: While users wait to receive their printers, the technology is evolving and improving rapidly. Will someone who bought a RepRap-style, assemble-yourself printer be happy with it when they see others buying better printers as theirs (finally) arrives? When the other printers have more advanced features like multi-extrusion, out-of-the-box functionality or has a significantly larger build size, how will users feel?

Disappointment: There is something truly magical about watching an object being built right in front of your eyes. Many of the videos on Kickstarter do a great job of highlighting this and the great story behind whomever is making the product. Unfortunately, when you actually get your printer, getting the magic to work for yourself isn’t always easy. These videos don’t show the 6 steps it may take to actually get your design to print or the steep learning curve for design software. They also don’t account for what many of these first-time hardware startup founders are going to face with manufacturing a quality, reliable product. And this ignores greater challenges like the unfortunate IRS issues Printrbot faced, which are bound to strike some campaigns.

The Hangover

Most of the major 3D printing projects funded over the last year are still within their delivery time period, so we’re likely to start seeing some of the delays and pains soon. Like the slow growth in intensity of a hangover’s headache, as the months proceed, people will get anxious for their Buccaneers, Rigidbot (which was due starting in September and likely coming this fall) and Peachy Printer.

Like the blaming of Tequila for your worst hangover, I expect these issues will lead to buyer’s remorse and a black mark for the greater consumer 3D Printing industry; the current market offerings may have solved many of the issues that the Kickstarter projects had, but the wounds from problems with a campaign a user funded will deter them from buying another printer for awhile (as will the financial ties). This is exactly the kind of events that can contribute to the predicted bottoming out of the hype cycle Gartner talks about.

The Hangover Cure

Like a large bottle of water, 2 Advil and some greasy food, I expect there will be a few tactics that will help the market overcome these issues:

1) Feature bonuses

In its early days, Microsoft was notoriously late on projects. They would placate angry partners by promising (and delivering on) new, additional features in exchange for a pushed delivery date. If Kickstarter projects are late, those companies may try a similar tactic to placate their users. This opens up 3rd parties to supply those solutions like I hear the guys at DGlass3D are talking about being an OEM supplier for 3D printing companies that found them on KickStarter.

2) More help with manufacturing

Finding manufacturers is a scary, risky proposition.  On top of the challenges of choosing the right one, a company’s initial design isn’t always easy to manufacture, which requires redesigns and negotiations. Fortunately, there are a growing number of programs to help first time hardware founders like the Highway 1 program in San Francisco. There is also an ever expanding group of people to learn from that have successfully set up their first manufacturing as more hardware startups launch and grow.

3) Shift in models

The early days of the PC industry saw computers sold by mail order pre-orders in Popular Science Magazine and other publications, which isn’t that different from the crowdfunding on Kickstarter today. After a few years of pre-orders, specialty stores started opening where you could see computers, there was real inventory and friendly help. Those stores can provide a much better experience than a pre-order, but they require a greater sales volume, which we’re just starting to get to a market state to support. Such stores are just starting to open like HoneyBee3D in Oakland and MatterHackers in Lake Forest, California.

4) Deliberate marketing to differentiate from Kickstarter printers

If Kickstarter printers are viewed with increased skepticism, then experienced, growing 3D Printing companies will want to differentiate from them. These companies can focus their marketing on being a team of experienced engineers and manufacturers with the latest technology and no wait time for delivery.

5) More evidence of deliverability on Kickstarter

Kickstarter is still an unparalleled way to get press, partnership opportunities and most importantly, paying customers for 3D printing companies. Showing more progress and possibly even manufacturing already fully planned could go a long way to being the “responsible drinking” solution to the Kickstarter hangover.

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In general, I expect that a shift away from Kickstarter will occur as there is an industry shake out and consolidation; there are over 300 3D printing companies now and so there’s no way they will all survive in the coming years. As they consolidate, user bases will also, lending itself to sales and marketing being done by each company without the need of Kickstarter (or their 5% cut).

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Consequences of the New Wave of Consumer 3D Printing

16 September 2013

On Friday, the Zeepro Zim 3D Printer hit Kickstarter. It has dual extruders, a consumer-friendly print interface, wifi capabilities and the aesthetic of a true consumer product, all for under $1,000.  While not the first printer to have some or all of those capabilities (see also the Buccaneer and while a different technology, Formlabs nails the precision and aesthetics) it marks the growing trend of moving beyond raw, exposed RepRap style printers so beloved by the hacker/hobbyist. While the past few years have been dominated by RepRap and the open source community efforts, I believe we’re in the midst of a transition to the next phase of the market.

The Capitalism Transition

What started for many as simply a desire to make printers for people like them is now becoming a very competitive business. Those that want to continue on those efforts and compete with the 300+ other consumer 3D Printing companies are challenged with keeping pace with current product developments or be lost in the dust.

With all the hype, it’s easy to forget how early it still is. Even the most optimistic estimates only show 200,000 consumer printers owned as of the end of 2012, which isn’t much if you spread that across 300 companies and know the leader has 20-30,000 of those. As a consequence, some companies will starve as they fight to stay relevant and get a piece of the growing revenue pie.

In this new era, a number of changes are occurring:

1) A different kind of founding team

As the market matures, it is attracting more experienced entrants. Zeepro was founded by successful serial European entrepreneurs. They have significant manufacturing and business building experience having previously taken companies to IPO. I’ve spoken to another stealth startup with significant, relevant manufacturing experience with similar designs of conquering the market and starting out with many of the most common problems solved and requested features included in version 1.

This stands in stark contrast to many of the founders to date who are either students/recent graduates or small teams of hobbyists. Many of the post-Kickstarter manufacturing challenges faced by some of the early entrants are unlikely to affect these new teams.

2) A race to feature parity

The roadmap for most companies has been clear for awhile: add a second extruder, a heated bed, eliminate manual calibration, network the printer, expand your print size and improve reliability and stability. With more entrants like the Buccaneer and Zim as well as Makerbot charging ahead, the stakes are raised. To stay relevant, you have to be able to meet those same feature demands faster.  As competition heats further, I expect more companies to push the innovation envelope so they can make feature comparison charts that make them stand out.

zeepro feature chart

3) The slow decline of open source

If it were not for the RepRap movement, we would not have the printers of today. Every company has borrowed from open source and in many cases contributed back. However, as competition has heated up, the amount opened back to the community appears to be decreasing and talks of patents and keeping technology closed has increased. As companies try to stay one step ahead and create breakthroughs based on their own efforts, I expect the lure of a competitive advantage leading to more sales to supersede their desires to contribute to open source.

This will mark the steady decline in relevance of the open source movement for 3D printing as companies with employees working intense hours will surpass what hobbyists and researchers can contribute.

4) A new focus on user experience

As we move from the innovators to the early adopter market, the needs of the user are changing. For every user that wants to build their own printer from scratch, there are many more who lack the skills or interest to do so. New printers that “just work” will become the standard and companies that can both minimize support issues with a quality product and provide great service when there are issues will stand out.

Some companies will not survive this. Having had a Solidoodle 3 for a month now, I have easily spent more time fixing problems and emailing back and forth with support than I have printing. Like other printers currently on the market, when it works, it’s great, but it is not stable enough to recommend to others, especially if they’re less technical.

5) The quest for the killer app will intensify

With more reliable printers with greater functionality hitting the market, new uses will emerge.  As more people own the printers, experimentation on how and what you can print will grow. As this happens, we’re likely to finally see the emergence of the “killer app.”

In the PC market, early consumer computers were considered toys and a hobby until the invention of the word processor and spreadsheet changed everything. When PC features finally allowed for a quality version of each, consumers changed their tune from, “Why would I want a computer?” to “I’m buying a computer specifically for that application.” Today, we’re still in the “Why would I want a 3D printer?” phase as scanning your favorite gnome figurine is far from a killer app. That will change in the next few years.

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The 3D Printing market is in a rapid state of change. This new phase of the market is one of the first shifts of many to come. Companies that adapt will not only survive, but thrive, while others are soon headed for footnotes in history like IMSAI and Kentucky Fried Computer in the early days of the PC market.

You can see this transition for yourself and check out companies like Zeepro at the Inside 3D Printing Conference in San Jose tomorrow and Wednesday. You can save 15% by entering code “JE15”.

3d conf

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How 3D Printing Companies are using Kickstarter to Accelerate the 3D Revolution

29 August 2013

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In January 1975, Popular Science magazine ran an article on the first consumer computer: the Altair. Ed Roberts, the founder of the company making the Altair, ran ads in the magazine for pre-orders of his device for a then-shocking $400. He needed to sell 200 to break even, but ended up selling over 2,000 instead. There were many challenges in actually delivering the device and plenty of upset customers due to delays and limited functionality, but it marked a key moment at the start of the PC revolution. A small company named Microsoft would work closely with them to run BASIC software on it and many other hobbyist computers would emerge in coming years.

Today, the chosen pre-order crowd-funding source is Kickstarter and once again early adopter backing is funding a new revolution: consumer 3D Printing.

A quick search shows there have been over 75 projects posted on Kickstarter related to 3D printing. Of those, 5 are currently active and 35 have been funded (a 50% fund rate on completed campaigns). Since the start of 2013, 38 of these projects have launched, with 17 funded and 16 failed (the other 5 are still active). Some projects have even raised millions of dollars like the Buccaneer ($1.43mn, 3,520 backers), RigidBot ($1.09mn, 1,952 backers) and the 3Doodler ($2.34mn, 26,457 backers). All 3 of those projects launched in the last 6 months.

So with all this funding, how is it affecting those that post? To find out, I spoke to a variety of companies currently crowd-funding, planning to crowd-fund and already completed both successful and failed campaigns.

Preparation matters

The first thing that stood out for all the companies that I spoke with was how important preparation was for their projects. No matter how much time they spent to understand the work ahead, there were always surprises and new challenges. Those that hadn’t figured out the finer details of their project before launching the Kickstarter were significantly more likely to fail in funding.

The preparation also extends to marketing. Designer Todd Blatt, creator of the funded Google Glass project, GlassKap, observed, “[Many projects] think you just make a Kickstarter and people come. You can’t count on that.” I asked companies what the ratio was for backers that came organically from Kickstarter versus their own efforts and it was usually 60% their efforts. Getting ahead in their marketing meant thinking about press and forums to post to at launch and building lists in advance. DeltaPrintr, a delta-style RepRap design launching in the fall, is smartly already collecting signups on their detailed website which explains their product’s benefits and differentiators.

Screen Shot 2013-08-28 at 12.12.21 PM

The value extends beyond funds

Like a good angel investor, many of the backers on Kickstarter add more value than just their money. File2Part, a 2012 campaign for better 3D printing software, found that about 15% of their backers were tremendously helpful in debugging their beta release of their software as the backers were also software engineers. Meanwhile, DGlass3D, a current campaign to create a better dual extruder for 3D printers, has already gotten great feedback from hobbyists and hackers backing the project.

With so much traffic and attention given to many of the Kickstarter projects, it can also be a signal to those in the market that your company is someone they should work with. Volumental, a current campaign for browser-based 3D scanning and printing, has received numerous business opportunities because of the attention around their Kickstarter. They’ve also turned the campaign into press that extends beyond the project and helped raise the visibility of their company.

Even more impressive is how a failed campaign by 3Dagogo actually inspired them to start their business.  Their May 2013 campaign to sell 250 useful 3d printing designs did not fund, but many members of the 3D community reached out to them saying they were working on an important problem. That was all the encouragement they needed and they’re now working towards a site launch.

Critics can be harsh

While Kickstarter tries to manage backer expectations on projects, there are still times when users can be difficult or even angry. In the case of DGlass3D, some potential backers were upset with the way they planned to handle their IP for their design (a hot button subject in the 3d community). After some passionate discussion, it led to DGlass3D changing their IP plans and updating their description of it on their Kickstarter page.

Meanwhile, File2Part has had a number of delays on their project enraging some backers. Co-founder Eugene Giller told me that when they launched the campaign, they had a prototype of the software working with the printer they owned. Unfortunately, there are many variations on the firmware for other printers and some companies not only change them, but sometimes make them closed to 3rd parties (most notably, MakerBot). It has put them in a endless loop playing catch up, which unfortunately not all backers empathized with:

angry kickstarter backer

Stories like File2Part’s is why when I spoke with DeltaPrintr, they told me they are trying to have everything in line, even suppliers and manufacturing, before they launch their campaign. They hope that Kickstarter can simply then be the platform to connect with their first customers and add the funding needed to fulfill orders with their manufacturer, without delays and drama.

Funded projects do not guarantee success

It would be great to say that every campaign that funds on Kickstarter has a fairy tale ending of delivering on time and launching to ongoing success. Unfortunately, we know that’s far from true. 

Going beyond the disappointment of the end user who may receive their orders late, below their expectations or sadly, not at all, companies can face struggles as well. After the costs of making his video, marketing and adding the cost of printing the objects, 3D designer Todd Blatt found he didn’t make any money on his funded GlassKap project. He did tell me, he will likely do another project in the future based on his learnings from this one.

File2Part, who had the aforementioned firmware challenges, actually hired a consultant to help them with those issues. Unfortunately, the cost of that consultant exhausted all their funds raised which led them to take a loss overall on the project.

Understand your audience

The stories of success on Kickstarter have spread far and wide, which is why all of the people I spoke with turned to the platform for their company. However, it’s important to realize that like any website, there’s a specific audience that is generally found on Kickstarter. They are often consumers, with a bit of an early adopter and hacker edge to them. Some will back many projects, showing more allegiance to Kickstarter than any of the individual companies they back.

This proved a solid audience for GlassKap, as Todd was able to fund his project even though there are only 10,000 Google Glasses in the public now. Similarly, the consumer-friendliness of Volumental’s browser-based scanning also funded well with the Kickstarter audience.

Screen Shot 2013-08-28 at 1.46.31 PM

Meanwhile, 3Dagogo’s 250 3D print designs failed to fund, as many Kickstarter backers are still waiting for their Kickstarter-backed printers and many of the hackers and hobbyists with printers already have proven to be less interested in the pre-made designs.  And while File2Part did fully fund, they found many of their backers were not who they were hoping for; their goal is to build an industrial-grade 3D printer to sell and were not expecting to have so many consumer printers to support.

Kickstarter is an amazing platform for discovery and funding of great projects. Like the pre-orders of the Altair, it doesn’t always go as planned, but great things can come of it. Two 20-somethings from Harvard moved to New Mexico to write the software for the Altair. We may not have had Microsoft today if early adopters of the Altair hadn’t sent those checks to get their first consumer computers.

What new industry titans will come from crowdfunding like Kickstarter and the ecosystems they help create?

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Sources:

Thanks to all of the companies that spoke with me for this article:

Consumer 3D Printing has a Twitter Problem

16 August 2013

1 Comment

Back in 2009, Twitter was still the new kid on the block dealing with Fail Whales and a real question of what they were going to become. During that time people who didn’t use Twitter would often say, “Why would I join Twitter? I don’t care what you had for breakfast.” This proved to be a big hurdle for Twitter as they tried to slowly learn what hooked people and how to describe the value they provided so they could successfully go mainstream.

Today, 3D printing is in a very similar position. There’s tons of press talking about the potential and much activity in the ecosystem. However, just like with Twitter a few years ago, people look at consumer 3D printers today and say things like “I don’t get it. Why would I want to print a bunch of plastic junk?” 

How 3D printing will cross the chasm

What we’re really talking about is a disconnect between a product’s capabilities, its core value, and the average consumer. Twitter was able to cross the chasm thanks to their own learnings of how users best got value from them as well as fortuitous events like the Arab Spring and celebrity events like the passing of Michael Jackson showing a use case everyone could understand.

In the case of consumer 3D printing, they need a few things to happen:

1) Cheap, consumer friendly devices

Consumer electronics seem to currently do best when they’re priced at less than $1,000 (see the Kindle Fire, iPad, most laptops, etc). Currently, the vast majority of 3D printers at that price point require your own assembly and have a steep learning curve. Makerbot, Cubify and many of the Kickstarter printers like the Buccaneer are hard at work to get that price point down and the out of the box functionality significantly improved. Without this, nothing else below matters, because people won’t be able to figure out how to use them.

2) Separate the fantastic from the realistic

Every day there’s an article about something new about 3D printing in medicine, NASA, weaponry or something else exciting or controversial. Unfortunately, all that press hypes up the potential of 3D printers while setting unrealistic expectations on the current state of consumer printers. Helping separate the two is a challenge for everyone in the market. How do you get people excited about the (albeit limited) abilities of consumer 3D printing?

3) A Killer app

Right now, anyone can print what they can imagine if they have the CAD design skills. They can also explore sites like Thingiverse for designs they’d like to download and print. Unfortunately, even downloading a design isn’t guaranteed to be an easy, smooth experience. Even the emergence of cheap 3D scanners feels unlikely to be the silver bullet since consumers will still have the question of what to scan. All of this also ignores the limitation of single-color plastic as your usual printing option.

In another technology’s chasm crossing moment, the PC went mainstream with the inventions of the word processor and spreadsheet, which were 10x better experiences than the typewriter and manual bookkeeping. Not all of the limitations have to be overcome to create a killer app, but the question remains: What can 3D printing be 10x better than for an average consumer?

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If there’s one thing we know for certain, it’s that movements like these don’t stop. It’s only a question of who leads the innovations and when the market will take the leap to mainstream.

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