A comment from our post regarding Formlabs’ acquisition of Carl Bass prompted a comment from a reader that deserves an answer.
Carl Bass, of course, was the longtime CEO of Autodesk, who recently retired from that position. Now he’s taken a position as a board member for the strongly growing Formlabs 3D printer company.
While at Autodesk, Bass oversaw the big change that moved (or I suppose is still moving) their software base from standalone products to cloud-based subscription products. Instead of paying a one time fee for a perpetual license for their software (with the option of paying for upgrades later on), the company changed their business model to require a monthly payment to use the software, which is always up to date.
I’ve written about this in the past, but for them and for some of their user base it also makes sense. But it doesn’t for everyone.
We posted a short story on Bass’s new position with Autodesk, which generated the following comment from reader Bob:
Look forward to a lease only arrangement on your next Formlabs printer… Like the Carbon and every piece of Autodesk software currently in existence 😛 I do not see this as a positive development for Formlabs.
Or maybe I’m just bitter because, between breakdowns, I’ve only gotten about 8 useful months out of 4 years of Form 1+ ownership. Or maybe because I’m bitter that, after 20+ years of Autodesk loyalty (3DS MAX) they’ve done *&^$-all to fix their software bugs and then slapped us with a subscription only arrangement that is over three times more expensive than their previous yearly upgrades.
While I cannot speak about bugs and breakdowns, as that’s a matter for the companies involved to respond to, I can offer some thoughts about leasing, which Bob suspects Formlabs may move to given Bass’s previous work at Autodesk.
Virtually all hobbyists buy their 3D printers outright, and the notion of leasing is not in the picture, but the story is quite different at companies, where leasing is a very popular – and sometimes required – option.
Many companies run on thin margins, and sudden unpredictable expenses can be extremely disruptive, or even catastrophic in some cases. For this reason, some firms opt to lease as many things as possible to smooth out their expenses. They make them predictable, as the lease will specify the pricing over a multi-year period.
At the end of the lease, they usually assume they’ll give the old equipment back to the lessor and lease something new and better. No big capital dollars are ever required, and no financial surprises to deal with.
Of course, the implication is that the equipment had better operate properly during the lease period. It makes no sense to lease a machine for five years if it only works for two.
But these are concepts that may be foreign to hobbyists, who typically buy the machine and use it until it fails. Then another is acquired. The amount of money involved is relatively small, but for a big company, they need to lease everything to control cash flow.
Will Formlabs begin leasing 3D printers in the same way that Carbon does? I’ve heard no rumors of that sort, although that doesn’t mean it won’t happen.
If it does, I expect that Formlabs would offer two alternatives: a leasing program for those that require it, and an outright purchase price for those that don’t.
Formlabs really should do this, as there are many companies that would appreciate the ability to lease. And, as we know, corporate customers are the market Formlabs is now targeting.
