Nano Dimension Makes Second Acquisition in a Week

Electronics 3D printing company Nano Dimension is ramping up industry 4.0 solutions in digital fabrication applications rather than building machines as capital equipment. Working towards this goal, the Israeli company acquired two startups in just one week. On April 20, 2021, it announced the takeover of DeepCube, a machine and deep learning technology startup, followed by NanoFabrica, a developer of precise 3D-micro-printing technology. Nano Dimension has committed roughly $125 million in acquisitions in only seven days and has kept the investment within its country’s borders, as both startups are also based out of Israel, yet, several financial experts reported a few red flags with the company’s finances and management team.

Nano Dimension is trying to fill a void in micro-printing machine learning (ML). The company claims the new deal with NanoFabrica will provide Nano Dimension the power of its additive manufacturing (AM) solution that uses digital light processing (DLP) for applications that require extremely high precision – between one to two microns. Even the two companies’ target markets are identical and include aerospace, aviation, high-end electronics and automotive, medical, and optics.

Founded in 2016, NanoFabrica has been poised to become a prominent player in the field of precision digital manufacturing with industrial AM systems considered to have an unprecedented micron-resolution with ultra-fine features, details, accuracy, and precision, enabled by its innovative Micro Adaptive Projection technology. Designed to allow digital mass manufacturing of precise and complex parts, NanoFabrica’s system and machines could potentially transform businesses through micro-part manufacturing innovation.

The company claims its technology already equips users with ultra-precise high-performance parts for semiconductors, optical and medical devices, and ready within single hours at a fraction of their current cost, combining semiconductor lithography and advanced optics with 3D printing. But Yoav Stern, CEO of Nano Dimension, says he wants to go further by integrating NanoFabrica’s technology into Nano Dimension’s electrical capability and deliver advanced micro-mechanical electrical parts. He also claims that very few companies can do what NanoFabrica has achieved and hopes the combined technology will give his company a competitive edge in an emerging segment.

More importantly, Stern highlighted that NanoFabrica’s machines fit the larger picture of his firm’s vision to drive a revolution in artificial intelligence (AI)-distributed digital fabrication applications and ultra-high precision within additively manufactured electronics. Eventually, the end goal is to reach a capability for maintaining a digital inventory of high-end printed circuit board devices, micro-mechanical parts, and the firm’s trademarked high-performance electronic devices (Hi-PEDs).

Stern said the maxim would be: “Print them as you need them, where you need them, only the quantity you need, in the best quality at competitive prices, as it is done in highest yield and throughput possible for that point in time, specifically in high mix/low volume scenarios.”

Earlier in April, Nano Dimension announced it had signed a definitive agreement to acquire DeepCube for $70 million. The startup founded in 2017 by Eli David and Yaron Eitan applies numerous patented algorithms to improve data analysis and deployments of advanced deep learning-based AI systems. The machine learning application offers faster and more accurate training of deep learning (DL) models and drastically improves inference performance and real-time metrics. The startup says its proprietary framework can be deployed on top of any hardware.

As with NanoFabrica, Stern believes that by acquiring DeepCube, Nano Dimension will supply a next-generation solution to fill a void in the semiconductor industry, which he claims is “hovering” over the printed circuit board fabrication and assembly industries. He expects to establish an AI/ML “distributed digital fabrication application” to enable a totally environmentally and ecologically friendly digital control of the supply chain for Hi-PEDs. In fact, Nano Dimension machines shipping today (and especially next-generation devices which are under development) are slated to be smart edge devices in what the company is calling a “digital-fabrication-neural-network” solution.

Until May 2020, Nano Dimension was a startup trading on the Tel Aviv Stock Exchange (TASE) before delisting its shares to trade on the Nasdaq under the ticker symbol “NNDM.” The move coincided with an uptick in interest in tech companies, especially after the ongoing COVID-19 pandemic disrupted supply chains worldwide, boosting interest in adopting 3D printing technologies. Business site Calcalist reported early on in 2021 that Nano Dimension had ballooned to a valuation of $1.4 billion after completing five funding rounds that amassed a massive total of $922 million in two months alone, even though the company hasn’t generated more than $4 million in revenue in 2020, and was down 50% from 2019.

The latest acquisitions might confirm just how much the company wants to strengthen its position as a leader in smart, ultra-high precision manufacturing. However, the financial site InvestorPlace has disclosed that Nano Dimension is short on funds to make the deals happen. Specifically, InvestorPlace notes that “DeepCube’s Executive Chairman and DeepCube’s Chief Technology Officer are both directors of Nano Dimension! Thus, this is a clear related-party transaction.” The business is currently selling more stock to the public, which the experts at InvestorPlace consider a “red flag.”

Additionally, according to Edwin Dorsey, “Nano Dimension’s current CEO has been previously accused, but never convicted, of an ‘extortion attempt‘ and the company’s former Chairman was arrested on charges of money laundering, aggravated fraud, and securities violations.” These potential issues with the firm and its management team is not great news. Furthermore, many financial experts thinking the company stock is significantly overvalued has made investors wonder whether the technology and the firm’s revenues will ever take off.