As the Additive Manufacturing Strategies (AMS) 2024 event unfolds, a central theme has been navigating the investment landscape in 3D printing. The event digs into the areas of venture capital (VC), public markets, and scaling strategies. Here, both the expertise of leading VC firms for 3D printing and the longstanding experience of executives in well-known additive manufacturing (AM) businesses are critical to grasp the current terrain. The insights and discussions during the financial panels on the first day of the event shed light on the critical aspects of funding and developing technologies in an industry that stands at the cusp of transformative change. Some of the highlights and key points from the investment talks included plenty of strategies and wisdom shared by some of the most influential players in the AM VC scene.
During his keynote speech, engineer and AM Ventures Co-Founder Arno Held discussed some of the current challenges within the VC realm and the 3D printing industry at large, including reduced valuations and a more cautious investment climate.
“It’s not the best of times right now,” said Held. “We all know it. The valuations are down. Venture capital rounds in the U.S. are pretty much not happening at all, and I can tell this because I’m navigating a portfolio of almost 20 companies. So, it’s not always a great time to be a VC investor. In these times, money is not free anymore. In fact, founders have to give much more of their company for much higher expectations in the future, and the pressure is extremely high because investors have become extremely selective.”
Held says a lot of money was raised in 2021 and 2022 in AM, but the expectations have not been met. The repercussions of past overvaluations and the resulting shift in investors’ core beliefs stress the need for startups to show greater value and innovation amid heightened expectations. However, Held says these woes are opportunities for the industry to build creativity.
“I think this is a gigantic opportunity simply because if money is scarce, you have to become intelligent. I’m deeply convinced that too much money makes you extremely dumb,” said Held. “You don’t have to think very cleverly. You don’t have to come up with extremely clever ways to keep your boat afloat. A lot of money amplifies the stupid ideas, and scarcity of money makes you focus and makes you become extremely clever. And the good thing about this industry is that it’s full of extremely clever people. I am convinced additive manufacturing is here to stay.”
Held’s firm, AM Ventures, has evolved into an essential player in the VC landscape. With €100 million in commitments and a portfolio spanning from Austria to Australia, the firm claims to have a selective investment strategy focused on groundbreaking additive manufacturing technologies, including investing in 19 companies out of over 2,700 evaluated.
Funding innovations
The last panel discussion of the first day on VC in AM was nothing short of enlightening. Tyler Benster kicked things off, setting the stage for a deep dive into the private, young, and realistic side of 3D printing investments. The panelist lineup included John Hartner from the Digital Industrialist, Osman Ahmed from 10X Capital, and Hugo da Silva from Stratasys (Nasdaq: SSYS). Each of the speakers brought a unique perspective to the table, Hartner with his rich history in industrial tech and current focus on early-stage startups; da Silva bringing in a decade of 3D printing experience and an eye for strategic mergers, acquisitions and ventures; and Ahmed, known for his wide-ranging investment portfolio from early-stage to pre-Initial Public Offering (IPO) companies.
A recurring theme was the importance of application-driven investments over pure-play technologies. Both Hartner and da Silva believe in focusing on customer needs and the value delivered to the end-user, who is, in turn, responsible for investment success. Ahmed added that it’s essential to be a complete solution provider, not just an additive manufacturer. He highlighted the need for companies to offer comprehensive solutions that include machining and finishing.
The panelists also discussed the challenges and opportunities of the market’s fragmentation. With many players and technologies competing for attention, uniqueness and customer focus have become even more relevant. The panelists also discussed the potential for partnerships and consolidations to address customer problems more effectively and stand out in a crowded market. Looking ahead, the speakers gave a decisive nod to the roles of software and artificial intelligence in unlocking new capabilities and improving design and manufacturing processes.
“There’s so many people that have customers that have ideas, but to move it from an idea to something that’s a printable file, that takes a long time. I think in production where you have adequate amounts of data, you have sensors in all your machines, you have information from the machine, that is where AI is gonna help, in getting us to yields and productivity that’s necessary to meet the requirements and production that customers demand,” said Hartner.
Essentially, this segment was a fascinating mix of reflections on past lessons, analyses of current trends, and predictions for the future of 3D printing and venture capital. It underlined the industry’s dynamic nature and the critical role of strategic investment in propelling it forward.
For more on AMS 2024, read our ongoing event coverage on 3DPrint.com. AMS will return in 2025 to New York City.