Cloud manufacturing and digital supply chain company Fast Radius rang the NASDAQ closing bell on February 16, 2022, in New York to celebrate the company’s listing on the exchange as “FSRD.” Named one of the “nine best factories in the world” by the World Economic Forum, Fast Radius is leading the global additive manufacturing (AM) revolution from its Chicago headquarters, working to increase consumer demand for fast-turnaround and customized products through its growing network of distributed, industrial-grade 3D printing facilities and proprietary operating system.
Co-founder and CEO Lou Rassey rang the bell at NASDAQ as staff members gathered around him and cheered on, including co-founder John Nanry and chief operating officer (COO) Pat McCusker. The announcement follows the recent completion of Fast Radius’ merger with special purpose acquisition company (SPAC) ECP Environmental Growth Opportunities (NASDAQ: ENNV), which held $345 million cash in trust. On February 7, 2022, company stock began trading at $7.56 and closed at $6.74. Ten days later, the stock is trading in the $3.30 to $3.78 range and has a market capitalization of $140.16 million.
Commenting on the new public status of Fast Radius, Rassey said “the completion of our merger with ENNV is an extraordinary milestone for our company, our employees, and our shareholders. From day one, our purpose has been to make new things possible with our first-of-its-kind Cloud Manufacturing Platform where manufacturers can more efficiently and sustainably design, make, and move parts. All of us at Fast Radius, including a highly qualified board and management team, look forward to continuing our mission and to drive value for our shareholders.”
Founded in 2017, Fast Radius offers a variety of manufacturing technologies, such as injection molding, CNC machining, urethane casting, and AM, like stereolithography (SLA) and fused deposition modeling (FDM) 3D printing, Carbon’s DLP, and HP’s MultiJet Fusion, leading to the production of over12 million parts at commercial scale, not just prototyping. The ultimate target is to build the first $100 billion cloud manufacturing, and digital supply chain business, particularly as the global appetite for more agile, local and sustainable supply chains continues to develop.
Through its business model, Fast Radius is assembling a defensible, full-stack tech platform for manufacturing solutions and standalone software, concentrating on serving a massive $350 billion-plus component manufacturing industry, with applications in sporting equipment, automotive, etc. medical, and advanced construction robotics.
The focus is and will continue to be on its Cloud Manufacturing Platform, comprised of software and micro-factories to design, make, and move industrial parts in the modern era. Following a strong 2021 performance, Fast Radius hopes to move along with its decade-long plan to build a global network of interconnected micro-factories that will allow parts to move digitally, replacing traditional logistics by land, air, and sea, which have proven relatively inefficient amid the unexpected pandemic.
The latest SPAC deal and subsequent public trading announcement places Fast Radius at an estimated post-transaction equity value of $1.4 billion, with roughly $400 million in gross proceeds on its balance sheet, comprised of a $100 million fully committed private investment in public equity (PIPE) deal, including a $25 million forward purchase commitment from Goldman Sachs Asset Management and other investors like UPS and Palantir. Additionally, existing Fast Radius shareholders rolled 100% of their equity into the publicly listed company for an aggregate redemption amount of approximately $315.4 million and now own roughly 60% of the combined company at closing.
Surprisingly, Fast Radius was one of the few firms that went through with its SPAC deal since the second half of 2021, when a cancelation trend emerged and 17 SPAC mergers, valued at a combined $37.2 billion, were terminated. Commenting on the downfall, CNBC’s Jim Cramer suggested that the excess supply of initial public offerings (IPOs) and SPACs dragged down the stock market. Indeed, once a Wall Street favorite, SPAC deals are now spiraling downward, and it’s dragging 3D printing companies in the mix as well.
Some of the most recent upcoming SPAC deal cancellations include industrial 3D printer manufacturer Essentium and manufacturing automation company Bright Machines. So definitely, news of Fast Radius following through with its 2021 deal is quite refreshing. Although 2022 will probably miss the continued SPAC trend that last year helped fuel $620 billion thanks to 302 deals, it will be an exciting time for 3D printing businesses as they continue to drive private investment, transform factory floors and drive adoption levels. Moreover, as the role of digital manufacturing evolves, companies like Fast Radius will continue to thrive in their niche. For now, we’ll follow closely how the firm does on the NASDAQ exchange, but with SPAC deals dwindling, this year will be nothing like 2021.
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