Manufacturing and Process Management

Why hardware startups are difficult and how 3D printing could help

Being a startup is hard. Multiple surveys suggest well over half of startups fail within their first decade. But being in a hardware startup is even harder.

On top of the usual difficulties associated with startup life – identifting a problem/solution, building a product, finding a market etc. – there are the extra difficulties in manufacturing and shipping. Big names such as Jawbone, Juicero, and Pebble have all folded in recent years, while crowdfunding sites such as Kickstarter and IndieGoGo are littered with hardware companies that raised millions of dollars more than they asked for but still failed to ship a product.

One answer to the cost and challenges of manufacturing, especially for fledging companies, is 3D printing. Local, on-demand manufacturing allows for speedier delivery of product, rapid iteration of products, and reduced costs around shipping and storage, as well as simpler manufacturing processes.

The 3D printing industry, which includes machines, materials and printing services, is predicted to grow to $21 billion by 2020, according to a report by the Consumer Technology Association (CTA) and the United Parcel Service (UPS). There are over 700 3D printing startups, according to AngelList, as well as larger incumbents such as HP, Autodesk, Makerbot, and 3D Systems. 3D printing startups & services last year raised over $400 million across more than 70 deals, according to CB Insights.

According to the latest ‘State of 3D Printing Report’ from 3D printing services provider Sculpteo, the average budget companies allocate for 3D printing averaged $9,50 in 2017, compared to $6,000 in 2016 and $3,700 in 2015. Prototyping and Proof of Concept are the main current applications, while companies claimed future applications include accelerating product development (28%) and offering more customized products to customers. Users of 3D printers and services cite cost reduction, reduced batch requirements, and reduced production complexity as the main benefits they see.

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Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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