3-D printer manufacturer Formlabs raises $35m
Three-dimensional printers were once hyped as the next big thing in home gadgets, but it turned out consumers weren’t so eager to buy an expensive gizmo that can churn out plastic toys and appliance parts.
Designers and engineers, however, are still looking to buy.
MIT spinout Formlabs — which sells 3-D printers and related materials to designers, engineers, and other professionals — said Thursday it raised $35 million from investors to finance a big expansion.
The new cash, supplied by venture capitalists and the engineering design software company Autodesk, will allow Formlabs to hire more employees — it plans to grow from about 190 employees to about 300 in the next year — and continue expanding its product offerings.
Formlabs, based in Somerville, said it ships more than 1,000 printers each month, at prices of up to $3,500 each. The company declined to disclose more specific revenue figures.
Chief executive Max Lobovsky said a significant chunk of Formlabs’ sales come from the liquid resins used to create parts with its machines, which can cost between $150 and $400 per liter.
“We’re not a venture-funded company burning tons of cash. We raised this money to grow into new areas, not to sustain our operations,” Lobovsky said. “We’re a company that makes stuff and sells stuff.”
Autodesk’s involvement could help boost those sales further. The two companies will work to help Autodesk’s widely used architecture, engineering, and design software communicate more easily with Formlabs’ printers. The companies also may market their products jointly.
Formlabs’ machines use a process called stereolithography, which creates solid objects by shining lasers into a pool of resin that hardens when exposed to intense light. The method can create objects with very fine detail and has long been used in industrial printers, said Pete Basiliere, an industry analyst with Gartner.
Formlabs has been able to thrive by targeting professionals who cannot afford high-end industrial models, which can cost $20,000 or more, Basiliere said.
“It gives smaller design and engineering groups, at a very low cost, the ability to do rapid and iterative prototyping and modeling at their desk,” Basiliere said. “It becomes practical to put it into a lot of organizations, even if they don’t necessarily use a 3-D printer every day.”
The big manufacturers of 3-D printers are paying attention to the fast-growing, lower-cost startups. One of the biggest players, 3D Systems, previously sued Formlabs for patent violation. The companies settled in 2014, with Formlabs paying a percentage of its revenue as royalties.
Stratasys, another large 3-D printing company, acquired consumer 3-D printer startup Makerbot for about $400 million in 2013 but was forced to write down its investment by more than $190 million last year.
The consumer market for 3-D printing is still years from being sustainable, Basiliere said, but the professional market is expected to keep growing. Manufacturers of paper printers — including Canon, Ricoh, and HP — are also getting into physical object printers, he said.
Formlabs’ own growth plans include developing new kinds of resins that can create specialized objects, such as plastic mouthpieces with a guide-hole that helps dentists target their drilling.
Medical researchers have also used the company’s printers to create molds for realistic silicone facial prosthetics. One was used to make a prosthetic for a man who lost his lower jaw to cancer, allowing him to shed the surgical mask he once wore in public, doctors said.
“We don’t think it makes sense to make a mass-market 3-D printer,” Lobovsky said. “We haven’t always had the most hype, but we’re happy to be shipping lots of machines to people who are using them.”