On-demand printing platform Gelato, based in Oslo, Norway, achieved the coveted unicorn status after a new funding round. On August 16, 2021, the company announced it had raised $240 million in new funding, pushing its valuation to $1 billion. The cash infusion will accelerate Gelato’s market penetration and growth in the U.S. and Asia and expand new local production hubs and products, including 3D printing.
New York global venture capital (VC) firm Insight Partners led Gelato’s latest round, bringing the company’s total funding to date to $269 million since its 2007 inception. VC fund SoftBank Vision Fund 2, as well as funds managed by Goldman Sachs Asset Management, and other existing backers, like early-stage venture fund Dawn Capital; Gelato Chairman John Hepburn; SEB Pension Fund, and Tellef Thorleifsson, CEO of Norwegian investment fund Norfund, also participated in the financing.
Gelato joins other Norway unicorns, like online education firm Kahoot, online grocery firm Oda and storage technology company Autostore, as well as unicorns in the 3D printing universe, like MIT Media Lab spin-off Formlabs, 3D printing technology manufacturer Carbon, and office-safe metal 3D printing developer Desktop Metal (which is now trading on the New York Stock Exchange).
Set up as one of the fastest, smartest, and greenest one-stop-shops for customized print products on demand. Gelato’s unique business model and global production network tap into the growing “creator economy.” It lowers the barriers to entrepreneurs, creators, and global brands by giving them the production costs and delivery speed of large e-commerce sellers without upfront investment.
According to Insight Partners Managing Director Adam Berger, the Norwegian company’s platform is a “game-changer for the world’s creator community.” For example, he described how with Gelato’s software, an African entrepreneur could produce, ship, and get paid for a product sold in Germany, with no upfront investment in inventory, manufacturing, or logistics, while achieving similar profit margins as competitors 100 times their size.
“This levels the global creator and e-commerce playing field and is an enormous economic and social opportunity. We believe Gelato is solving hyper-efficient local production at a global scale. Moreover, with the emergence of new technologies such as 3D printing, Gelato’s curated and global marketplace will empower businesses and consumers around the world,” explained Berger.
Up next, Gelato is diving into 3D printing production. The company announced on social media platform LinkedIn that the $240 million investment will help Gelato expand its team, which will accelerate its expansion of local production hubs and product categories.
“We will also add new capabilities such as 3D printing, which will allow e-commerce entrepreneurs to offer more and more products with local on-demand production of highly customized items,” expressed the company in the statement.
Aside from its headquarters in Oslo, the business has offices in Boston, London, Moscow, Mumbai, Santiago, São Paulo, Shanghai, Stockholm, Tallinn, and Tokyo, and claims to have local production capacity in 33 countries, capable of reaching up to five billion potential consumers overnight, and reducing carbon emissions from intensive logistics operations.
Through its hyper-local network of worldwide production partners and software, Gelato solves the challenge of producing and distributing customized products. In fact, thousands of online stores, like Shopify and Etsy, connect to Gelato for customized items produced locally and delivered within an average of just 72 hours. In 12 years, the business has fulfilled more than 10 million print orders, including printed wall art, clothing, books, and home decor, to a global customer base for e-commerce entrepreneurs, like sports courses art developer Sportymaps.
In the 3D printing ecosystem, companies like ProtoLabs and Materialise have empowered customers in a wide range of verticals, from automotive to aerospace, for decades, helping them transition towards a digital manufacturing process and launch innovations by pairing their demands with a wide range of 3D printing capabilities on a global scale.
Since Gelato opened its API (application programming interface)-driven platform to the e-commerce industry in 2019, it has supported larger companies and individual sellers and creators worldwide and delivered annual revenue growth of 120%. The revenue is propelled by the company’s API business which grew 320% year-over-year.
SoftBank Investment Advisers partner Anthony Doeh believes that Gelato’s curated marketplace can redefine manufacturing, breaking through previous barriers for individual sellers to access a global consumer base faster, and at a lower cost. In fact, Gelato’s customized software platform connects two of the world’s largest industries, the $230 billion digital production industry, with the rapidly growing e-commerce sector, according to the finance expert.
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