What started as a beloved open-source wooden box that could 3D print on the desktop has become so much more as MakerBot and the 3D printing industry have matured. With that maturing, the industry has watched MakerBot go through some not-uncommon growing pains — Do we go closed source? (yes) Do we let a larger company acquire us? (yes) — and reshape itself into a company more in keeping with the current vision from management as it stands. Of course, “management as it stands” is a vision in flux these days, and not just for MakerBot, as many big names in the industry, including MakerBot’s parent company, Stratasys, have been restructuring their C-level executive forces lately. It stands to reason that each incoming executive team will have their own vision for how a company should be run, and a new Chief Executive Officer in particular will often make especially big waves in the shape of an organization.
We saw this in 2015 when MakerBot restructured under Jonathan Jaglom, with two rounds of layoffs, the closure of their retail locations, and move to a contract manufacturer. While Jaglom told us after the first cut of 20% of their workforce that, “The recent layoffs were painful, but they were necessary,” he noted further that:
“Layoffs are incredibly difficult. They are the last resort after exhausting all other options. I’m grateful for the contributions of each and every MakerBot employee. We wouldn’t be where we are today without them. We had to make this difficult decision to stay focused on what matters most to our customers and return to growth.”
Of course, he also said at the time (May 2015) that we should not expect to see any further layoffs in the future; five months later was the second 20% staff reduction for the company. The reorganization, though, seemed to kick MakerBot into gear for a time under Jaglom’s leadership. Through the, ah, unfortunate circumstances surrounding the first Smart Extruder to the more recent refocus of the company on the educational and professional markets, it seemed we were watching the company grow up some more, with a vision that seemed to be backed up by an encouraging foray into applications in both education and product development. Things seemed to be settling into a groove, with employees being forthright about previous upsets and a prevailing sense of calm, as Lauren Goglick, General Manager, North America, MakerBot told me at CES 2017 last month, in the company’s smaller-than-previous-years booth space:
“It had been a roller coaster. Since Jonathan came on board, it’s been a smooth and steady ride.”
Not long after CES, the roller coaster that is MakerBot took off again with the announcement of Jonathan Jaglom’s decision to leave the company. The new CEO, Nadav Goshen, noted upon his appointment, “MakerBot today is in a much stronger position” and seemed ready to roll along; the company has made it a point to keep rolling out news of their well-being since the shakeup.Today, though, shortly before the official confirmation from MakerBot, we heard rumors of a massive new round of layoffs as the company initiated a new stage of restructuring. The news, since confirmed in an official statement by MakerBot, sees 30% of the current staff getting the axe today. Buried in the middle of the announcement from Goshen is this confirmation:
“However, we have to make additional changes to lower costs and to support our long-term goals. The leadership team and I have been working on a new organizational structure, and as part of this new plan we will reduce staff at MakerBot by 30%.”
I reached out to MakerBot for comment, but they are at this time not saying anything beyond the official line; I was told as well that they do not provide employment numbers, so that 30% was not clarified in terms of people. However, the source, a former employee at the company, who had reached out with the initial news tells us that according to a current MakerBot employee, “the 30% is going to be about 80 people.” They tell us that while there are not layoffs of entire departments, “they are skimming from the top all over” and that the head of the training team was among those let go.
One employee let go in today’s mass cut tells us that about 50 people have been laid off, and there may be more. This source notes that “it seems they gutted a lot of the engineering department as well.” They confirmed that about a six-week severance package is being offered for those sent packing, as well as a help session for anyone in need of help shining up their résumé.
A former member of the software team at MakerBot — who was among at least a few known staffers who left the company in the weeks ahead of this announcement, having seen a move like this coming — reached out to us, noting that “There are a lot of problems with the way they structure things internally that most people aren’t talking about outside the company walls.” The company’s structure seems to be heavily weighted toward middle management, as we were told:
“They tend to hire in fairly unqualified folks. A lot of people in ‘leadership’ (read: middle management) have no experience with software development, project management or domain-specifics around 3D printing. This has had a pretty terrible effect in a few ways.”
This person indicates that the number of project managers has been “a little high” considering the amount of product development and number of developers working there, leading to a “VERY vertical” structure. We saw some outlines of chains of command down from the C-level to “the people actually doing the work” focusing on, but not limited to, the software team that backed up the vertical nature at play, with “Very few people doing the work, many people sitting around making good money to drive the product in circles.” This source heard from a current employee today that four people in software were among those getting pink slips, but “they still have all but 1 of the project managers.” We also heard that the team running Thingiverse has been drastically reduced, now comprised of two people, with one the lead programmer for desktop, mobile and web. MakerBot has not provided confirmation of any of these reports.
The focus of a company, especially one with a name as big and reputation so broad as MakerBot, is critical to its success in the marketplace, and it certainly makes a good amount of sense for Goshen to look to long-term goals and get a laser focus on what he hopes to see the company achieve. His official statement is tied with a nice bow to package it as an announcement of strength of position, clarity in vision, and togetherness with Stratasys. It’s a shame that not only does that come at a high cost in personnel, but that that segment of the statement is placed in a low-visibility positioning, as especially in a company rooted so deeply in the maker culture, it’s the people who have made the company — and the industry — what it is today and have been shaping the way for its future. There is some care noted here, as Goshen provides assurance that severance packages will be provided. The conclusion of the announcement reads:
“The leadership team and I have further focused our roadmap on the essential products that are most relevant to our core customers in order to achieve our strategic goals. We have to reorganize in small groups around these offerings, then execute in the most efficient and agile ways. I’d like to thank those who are parting ways with us today for their dedication, hard work and friendship. MakerBot will be providing severance pay and will be offering career services to parting staff.
…Stratasys remains committed to MakerBot, and will continue to support its unique culture, and products. The Stratasys leadership team believes in the core achievements and strengths of MakerBot and supports it in making the hard steps, it has the utmost confidence in our collective ability to deliver industry leading 3D printing solutions.”
Bringing MakerBot to its newest targeted position in the market, Goshen’s vision for the company seems ever more closely tied with the vision from its parent company, or at least in invoking its name. For its part, Stratasys has been placing increased emphasis lately on the return to rapid prototyping with the recent introduction if the F123 Series. Further business strategies will surely emerge more clearly as we progress into 2017.
We’re sure to hear more placating case studies in the near future of successful applications for MakerBot’s 3D printers, educational offerings, and materials. Of course we hope to see the best emerge here, as perhaps this latest restructuring will be the one that brings MakerBot where it wants to be. You can read Goshen’s full statement on the need for change here. Discuss in the MakerBot forum at 3DPB.com.
This article has been updated following original publication to include more details from former MakerBot employees regarding today’s layoffs as well as the internal company structure; any additional input is welcome, with complete discretion, at email@example.com