FDM Innovation Entrepreneurship Scott Crump BSME CoFounder CEO
FDM Innovation & Entrepreneurship Scott Crump BSME, Co-Founder & CEO Stratasys
Stratasys & UTEP Partnership • 10 years of business & partnering • UTEP has twelve Stratasys FDM Systems • UTEP has been a Beta Site and they do joint development in R&D including: – research – mechanical strength properties & characteristics – build parts for customers
FDM Innovation & Entrepreneurship
CO-FOUNDERS Scott & Lisa Crump set out to automate the gap between the CAD blueprint and the final manufactured product …. now called Rapid Prototyping
The “Start Up” • Built “Toy Froggy” with 2 yr. old daughter - 1988 Ø Realized layered beads could build a part with a glue gun • Added glue gun to a 2 D Pen Plotter = 3 D Plotter Ø For Proof of Concept Ø In our garage
Vision • Offer Engineers a 3 D Printer for desktop 3 D CAD: Ø Easy to use - one “build button” from CAD Ø Automatic build of prototype Ø Use in the design office Ø $12, 000 Price Ø Real production grade plastic parts • We kept with the vision
3 D Plotter - Vision
Operating 3 D Plotter prototype
The “Start Up” • “ 3 D Plotter” for Auto. CAD run on IBM PC Ø Tested Proof of Feasibility & it worked • We had spent $10, 000 so far - the big question: Ø Do we take the risk of a start up Ø Quit my job with good income - for no income Ø Or just forget the idea Ø Looked easy - but it wasn’t an easy decision • Started up Stratasys on 2 nd shift – working 1 st shift
Lessons Learned for Engineers • Follow your dreams • Clear vision is more valuable than a detailed plan & have faith in your vision • Take as high of a risk as you can stomach and control
Emerging History - FDM Technology • I filed for a FDM Technology Patent • It was granted in 1992 • FDM - Fused Deposition Modeling: Ø Lower acquisition price vs. competition Ø Production grade plastic parts Ø Office friendly environment
Emerging History - Patented FDM Technology Support Material Modeling Material
FDM Filament Spools
Lessons Learned • • Get Patents to protect global proprietary position Start ups are a lot about survival and persistence The entrepreneur is persistent Cash is KING - you’re in business as long as you have cash
Lessons Learned • Keep focused on what value you add to your customer • Price your service and product to the market - not cost • Work with a seasoned Mentor that has done it • Try to have variable cost & low fixed cost
Funding - Sold equity as needed - to grow • Lisa & I invested in 1989 • My family invested in 1990 • Talked with 74 Venture groups & we found one • Battery Ventures (VC) invested $1. 2 M in 1990 • Lisa & I invested again 1992
Funding - Sold equity as needed - to grow • Serious problem funding high growth!! Ø We were growing at 125% per year ØUnsuccessful getting $5 M private offering Ø Difficult decision - do IPO or shut the doors • We contacted 23 IPO underwriters nationally • Successful $7 M IPO in 1994 ØEast Coast Underwriter ØWe had Sales of about $3 million ØStratasys publicly traded on NASDAQ
Lessons Learned • Stock options help employees focus & gain • Don’t be afraid to sell equity - 100% of nothing is nothing • Don’t fund long term risk - with debt • We thought we could grow Stratasys with $90, 000, it actually required $20 M - Hey not all plans work
FDM can build working assemblies
3 D Printer – Stratasys First to Market $25, 000 IPO funded 3 D Printer development
Enormous Growth Potential Global Engineering Population 28. 5 Million Engineers 5 Million MCAD Users Source: Stratasys, CADigest, engineeringtalk. com, Deskeng. com
3 D Printer Opportunity AF Systems Today 37, 000 5 Million CAD Workstations Worldwide 3 D Printer Opportunity >500 k Systems at the right price!
3 D Printing Vision SSYS • Currently shipping 2, 000 Units per year • We have a plan for 5, 000 per year • My vision is 10, 000 per year
3 D Printing SSYS – The question is, how to do 10, 000 per year? – For this expansion, we need to: 1. Improve system quality & our culture 2. Growth of sales channel
Lessons Learned • It’s really all about your team of employees • Hire the right employees the first time – If you don’t know how to hire, use a head hunter • Don’t be cheap with employee salaries • Measure and share critical business metrics
Traditional Technology “S” Curve The 3 D Printer fits a Traditional Technology “S” Curve
Stratasys Sales Growth (in Millions)
Industry Overview
Industry Overview
Cross the Chasm with a Whole Product
Whole Product Criteria • • • Correct price Correct ongoing operating cost Product reliability Ease of use Correct sales channel Product speed Part quality Correct market application Competitive positioning
Whole Product Criteria - FDM-3000 Scale: 10 = High to 0 = Low
HP Agreement Stratasys and HP Agreement: Taking 3 D Printing Mainstream
HP Agreement • HP will sell our 3 D printers as HP brand. • Stratasys will develop and manufacture for HP based on proprietary Stratasys FDM technology. • Part of $24 billion HP’s Graphic Solutions Business • HP’s goal is worldwide distribution of 3 D printers.
3 D Printing Opportunity + Right Solution + Right Channel Millions of Potential Users
FDM Medical
Application Success Story For Medical Tools, Functional Prototypes Improve Design – Ratchet for Spinal surgical procedures “At Medtronic – Sofamor Danek, cutting edge medical technology takes new shape, thanks in part to FDM prototyping technology, forward-looking companies seek forward-looking partners. ” says RP designer, David Freeman.
FDM Future So how will FDM expand in the future?
Futuristic FDM • • • Architectural models FDM for the home hobbyist Metal FDM parts Nano and composite build materials FDM fabricated semi-conductor chips
Direct Digital Manufacturing • Fully automatic touch-less labor products • Production of end use parts • Hydro forming sheet metal fixtures
Sheet Metal Hydro Forming FDM Hydro-form Example • Male mold with intensifier • FDM trim tools for sheet metal blanks or formed sheet part • Coordinated structure removal and installation tooling
3 D Production Systems Direct Digital Manufacturing 200 mc™ 360 mc™ End Use Parts (EUP) 400 mc™ 900 mc ™ $100, 000 tool savings using DDM process for one part
Questions
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