Inspired in part by the SPAC merger of Markforged with one, Rocket Lab with Vector Acquisition Corporation, as well as the acquisition of EnvisionTEC by Desktop Metal, and of RPS and Origin by Stratasys, we’ve been brainstorming about the newly hot 3D printing stocks and renewed interest from investors in our markets. Is 2021 going to be a SPACtacular year for us? Here we speculate on some Merger and Acquisitions activity that we’d like to see in 2021.
Thank you for the many messages and questions about this series of potential and sometimes fanciful mergers and acquisitions for the 3D printing industry for this year. You can find all of the articles in this series here.
3D Systems Buys nScrypt
I’m a huge fan of the company nScrypt and think that, apart from a name I still can’t spell after all of these years and a tattoo parlor logo, the company is a real gem. The reliable, highly accurate systems that they make can perform microdispensing, print polymers, bioprint, and print electronics even in austere environments. What’s more, by having a ‘line in a box’ with different heads bringing different manufacturing technologies under one roof, they have the right paradigm in mind for the future of manufacturing.
Any future manufacturer of bioprinted organs would want to be able to make scaffolds and tissue on the same printer and then dispense medicine and other agents inside the same closed environment. This is something nScrypt can do incredibly well at extremely high accuracy. The company would have huge opportunities for expansion in 3D printed electronics as well as in combining microdispensing with electronics, printing batteries with electronics, and printing sensors.
Whether in IoT, wearables, or personalized medicine, many futures point to the use of nScrypt’s technology. It is alone at a very unique intersection at a very unique time. The revenue would make it very small for 3D Systems, but the products would give the 3D printing stalwart deep, high-tech defense business and a further entryway into bioprinting, but also high tech sensors and combined technologies. Would a newly disciplined 3D Systems be able to leverage nScrypt’s technology to push these circuit and tissue printers into many universities and R&D centers through its current channel? I think so. At the same time, it would be an R&D leap for the firm into the expanding current future of electronics 3D printing and bioprinting. To me, nScrypt is a dream of an asset.
Creality Buys BCN3D
Hear me out: Volvo.
Remember Volvo, storied but running on empty. People were worried that Geely would gut it or use it as a badge only. Have you sat in a Volvo lately? The interiors are like Audi with better design. It’s a miracle. Seriously, go sit in a Volvo. Geely leveraged Volvo’s brand, heritage, and know-how to propel a recapitalized and buffed up Volvo brand to new global highs.
High-volume but extremely low-margin, Creality could execute a similar play. Rather than selling 500 low-cost printers for $199, it could sell one BCN3D system. By buying them, Creality could catapult itself to the mid-market and towards larger production systems in one fell swoop. BCN3D’s ecosystem approach has seen them do much with materials, software, and application development, as well. With Creality’s forcefulness and heft, it could make a real run for Ultimaker and then Stratasys through its workshop level systems. BCN3D, on the other hand, may see a turbocharged growth and independence.
I know I’m going to get a lot of flack for this one but M&A is not always a game of finding two like things and kicking out a bunch of HR and regional people. Sometimes industry transformative events can happen when two very unlike things are united.
Canon Buys Evolve Additive
Canon is a company that is in a wide array of businesses that are all getting killed by your iPhone. It has had some flirtations with 3D printing but nothing dramatic or revelatory. For the firm, it would make sense to get into one market that is growing and doesn’t consist of three other Japanese companies duking it out for the chance to get killed by an app last. Canon’s repeated 3D printing market entry is somewhat akin to these people that dip a toe in, recoil, lower it while teetering on the swimming pool ladder for ages.
The firm does have a lot of experience in 2D printing, toner, inkjet, lenses, semiconductor, medical devices, and electrophotographic (Xerography) presses, however. The toner and the Xerography are most of interest here. Xerography is how your photocopier works. And that is surprisingly similar to what Stratasys-spinout Evolve Additive is doing. That company is able to manufacture, small, parts at scale using a very similar technique and toner as well.
So, Evolve’s technology would be very similar to and very easy to augment for a company like Canon. At the same time, Evolve Additive’s parts are the most consumer-oriented components that I’ve ever seen emerge from a printer. They’re short but have incredibly good surface finishes and the system should scale to many millions of items. What Evolve needs is a partner with a lot of capital and toner knowledge and this is exactly what Canon could bring them.
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